Author: Sushmita Meka

This weekend was one of complete catharsis for me.
The Indian microfinance sector, as is well known now, has gone through a roller coaster over the course of the last year and a half—one of emotion, accusations, and frustration. For myself, having had the privilege of working on the Access to Finance in Rural Andhra Pradesh study with colleagues at the IFMR Centre for Micro Finance (CMF), sitting over 7,000 miles away as the crisis unfolded was agonizing. Instead of being there to witness events unfold, to gauge the sentiment throughout the country as the crisis exploded, and most of all, to discuss all of this with my colleagues, those who were just as invested and passionate about the issue as myself, I was forced to follow along via dispassionate tweet, blog, and newsfeed.

The Centre for Micro Finance (CMF) and the College of Agricultural Banking (CAB)  organized the 5th round of the annual conference titled ‘Microfinance: Translating  Research into Practice’ in January, 2012. The objective of the conference was to actively engage stakeholders and researchers in discussions relevant to current and future microfinance practice.
During the inaugural session, Ms. Kamala Rajan, Principal of CAB, mentioned that the microfinance sector in India has surprisingly achieved positive growth this year despite the crisis in Andhra Pradesh and related fears and funding issues. Adding to that point, Dr Prakash Bakshi, Chairman of NABARD, mentioned that the history of the microfinance industry in India is very much in line with the history of Indian banking, though, he also pinpointed that despite the different parameters to determine poor and poverty - we are yet to arrive at a common standard and that time has come where bankers will have to rely on ev…

While going through the Economic Times today, I happened to come across this article which talks about how Savings products receive better response from consumers when its backed by gold or real estate. Forget real estate when it comes to the rural context - I was wondering about the relevance of gold savings in rural India.
For a select few who feel disgusted whenever a gold appears in front of us, be it at the cinema hall or on the roadside - lets admit that gold and its worth in today’s times is definitely something worth investing in. Rural India like any urban city has a lot of weddings that take place. We have often come across studies where people who have taken multiple loans cited marriage as one of the reasons behind taking up loans. [Click Here] Marriages need not mean gold transactions alone, it would be hard to deny that such do not take place.
Now, even if it forms a small percentage of their reason behind taking up multiple loans. The article that I posted h…

Author: Shardul Oza

A recent article in The Economist discusses the Reserve Bank of India (RBI)’s record over the last ten to fifteen years. In general, the magazine takes a favourable view of the central bank’s performance, citing its success in maintaining macroeconomic stability and controlling inflation. The article mentions that some critics have lambasted the RBI for its conservative approach to regulation, which they claim, has negatively impacted growth.
Having worked in the financial inclusion space for the past couple of years, I have witnessed how RBI’s policies can limit the outreach and effectiveness of financial institutions serving low-income households. In general, the bank has failed to create a regulatory framework that will catalyze financial innovation and rapidly bring quality financial services to India’s unbanked citizens.

Author:Mudita Tiwari


As we meander through the thatched mud-stained and brick houses in Uttar Pradesh, our team asks a curious group of smiling clients - “What did you learn at the training session?” or “Does it help when our team reminds you about your savings goals?”  The answer is inevitably a yes, but the “yes” comes at a cost.  Financial Literacy Education (FE) is most often a classroom based approach conducted either by the financial institutions (such as EKO, FINO), or an NGO (such as Parinam Foundation) or by research institutions (such as CMF), and is most often funded by international funding agencies. International funders and Indian financial institutions agree that educating and enabling clients about the products they are using is critical.

Dear regulators, policymakers and other stakeholders:
I am a MFI client from an urban slum, and yes I have taken loans from 2-3 MFIs operating in my area. I do have a bank account, however, every time I have tried to use the banking services, I found the entire process too complicated, and I have no idea about bank Khatas or bank’s  products. In addition, I do not find their staff friendly or courteous. I remember the day when a MFI loan officer visited my house asking if I needed any credit. My friends and neighbors were asked to make a group and apply for the loans together.  Why did I need credit at that time?  I remembered that I had taken a loan from a moneylender the previous month, and I thought I could use this MFI’s loan that had a lower interest rate to pay the moneylender. At least that way I could save some money, which, otherwise would have gone to the moneylender.