Performance of micro-finance providers in Karnataka
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Date
2007
Authors
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Journal ISSN
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Publisher
UAS, Dharwad
Abstract
Self Help Groups (SHGs) form the basic constituent unit of the microfinance
movement in India. An SHG is a group of a few individuals – usually poor and often women
– who pool their savings into a fund from which they can borrow as and when necessary.
Over the time banks begin to lend to the group funded out of the savings generated by the
group members themselves, are called “inter-loans”
.
The Role of NGOs in Microfinance: Self Help Groups are almost always formed with
outside assistance. Developmental NGOs, often with considerable history of working in a
particular area for projects like literacy, sanitation etc., take to organizing SHGs, bringing
together people, explaining the concept to them.
In the year 2005-2006 the total number of SHGs credit linked grew up to 61,730. The
compound growth rate of number of SHGs credit linked increased at the rate of 71.19 per
cent per annum. Similarly, bank loan disbursed to SHGs was found to be growing at the
compound growth rate of 95.97 per cent and refinance to banks from apex level institutions
increased at a compound growth rate of 75.83 per cent.
The highest impact was found in Chitradurga district where the income before the
establishment or working of the NGO’s was Rs. 19,862.50 and after the working of the
NGO’s started there income rose to Rs. 42,775 and their ‘t’ value was 6.78, these were
because of the higher lending towards the priority sector.
The most acute problem is the lack of time to participate in all the activities of all the
SHGs. This can be stated because the index value for it is significant here there were less
number of people who were monitoring the SHGs thus all the activities of all the SHGs could
not be monitored by less.