Microfinance is a very popular tool to uplift poverty by bringing in economic inclusiveness of the lower class, which is very essential for the holistic development of a nation. The concept as we know, had been started as the ‘Grameen Bank – The community development bank’ in Bangladesh by Professor Muhammad Yunus in 1976. It is centrally themed at the idea that the poorer sections of the population have the ability to be economically and financially included in the mainstream and can harness their abilities in contributing to the development of the nation and increasing the GDP.
When I studied about the Microfinance scenario in Assam, I learnt of how prevalent and useful this concept was in here. I had worked with a small, emerging Microfinance Group, called the Nightingale Microfinance Institute. Started in 1997 in Assam and 2005 in Guwahati, they had made marginal progress and have helped a commendable section of people in the rural backdrop. They had an industrious army of Credit Officers who braved plains, terrains and hills to reach out in the backwaters of the city and the state, where people need it the most.
We went to many hilly rural localities in the countryside of the city. One such incident was my experience in Birikuchi, Bonda. It is an area which is about 10 kilometres from the main city hub. Firstly as the rule goes, we had to investigate the houses of the appointed families. We had to check their financial status, and their living and housing facilities to approve them of the loan. There are certain criteria one has to fulfil in order to be eligible for the microfinance loan. There are two means of Micro financing schemes followed in Assam. One is the SHG-Self Help Group and JLG- Joint Liability Group. The JLG is popular and prevalent in this part of the state as the time constraint and the bank liabilities aren’t that big an issue. The crux of JLG is the Soliditary Lending System, where a group of five women borrow the money each, and when the time comes to pay the interest, they encourage each other to do so, and give it holistically as a group. There is an inbuilt peer pressure which helps built the liability and the responsibility in every borrower to give the interest regularly and on time. The houses of all the five members have to be in close vicinity in order to facilitate communication, networking and circulation and dissemination of information. Once that is done, we have the CGT- Compulsory Group Training, where the members are taught the ethics of being a part of Microfinance League. This help is predominantly given to married women of the age of 18-50, with a stipulated monthly income and a pre-planned and income generating Investment and business scheme. There is the GRT – Group Recognition Test, after this, where the Branch Manager tests the members, interviews them and then sanctions the loan. There is the Loan Disbursement Process where the cheques are handed out and the interest slips are given, where it is clearly mentioned the time an dates of the weekly interest payment proceeds.
Some important things which I observed in my surveys was most of the people invested the money in Weaving, Fishing, and Cattle Farming. The MFI also monitor and examines the success rates of such ventures so that any chance of loan default and collapse is eliminated. There were a lot of women who were pressurized by their husbands to borrow money for alcohol and tobacco. In this way, a lot of loans got piled up from different institutes and banks, and one loan was actually used to pay for another one. In this way, the whole purpose of the scheme was eroded. It is actually aimed at economic inclusiveness and woman empowerment. Giving the power to the woman of the family makes them more included and legally involved in planning out the economic avenues of the family, which in a way secures the safe interest of the family in terms of education of children and family business and promotes savings within the family.
Micro financing also is a way to promote and encourage savings. Though that is a bit hard to implement n all parts, but the very banks which lend money to the MFI’s encourage people to open fixed deposits in their branches, which plays a double role. It helps banks branch out and earn more, and it also keeps some safe money in the vault for these poor people to cope with emergencies and much required start up capital for new business ventures.
Now, it is for time for some bit of stats and facts...
The micro finance service providers include apex institutions like National Bank for Agriculture and Rural Development (NABARD), Small Industries Development Bank of India (SIDBI), and, Rashtriya Mahila Kosh (RMK). At the retail level, Commercial Banks, Regional Rural Banks, and, Cooperative banks provide micro finance services. Today, there are about 60,000 retail credit outlets of the formal banking sector in the rural areas comprising 12,000 branches of district level cooperative banks, over 14,000 branches of the Regional Rural Banks (RRBs) and over 30,000 rural and semi-urban branches of commercial banks besides almost 90,000 cooperatives credit societies at the village level. On an average, there is at least one retail credit outlet for about 5,000 rural people.
Though for now, because of the time constraint, I have to go back to college but I resolve to resume back for this project in my later course of holidays. At the cost of sounding absolutely cliché, it has brought me a bit more close to humanity, if at all. I walked and braved the scorching sun for the surveys and this made me see how hard people are working just to survive. It’s important to realise that upliftment of this section of people which makes about more than 40% of India’s population is the only way to actually bring about holistic progress of the country.
-
To be continued.
No comments:
Post a Comment