Microfinance and it's role in women empowerment

This is a PPT of microfinance and it's role in women empowerment

1. DOCTORAL SEMINAR ON MICRO- FINANCE AND ITS ROLE IN WOMEN EMPOWERMENT Presented by Sarita Ghidode Ph.D. (AG) ABM Presented to Dr. A.K. Gauraha Dr. S.K. Joshi Department of Agri-business and Rural Management

2. NTRODUCTION Microfinance is a source of finance to the poor segments of society. It includes loans, savings, credit, insurance services, money transfer and other basic financial services to the economically weaker section of society. Micro finance institutions include N.G.Os, Credit Unions, N.B.F.Cs. Cooperatives and banks. In India, the future of microfinance is largely depending upon the self-help groups (S.H.G.) It is considered as an effective tool for eliminating poverty in India. It provides credit and other financial services of small amount to the economically disadvantaged segment of society in urban as well as rural areas.

3. 1 To understand the concept of micro-finance 2 To know the role of micro-finance in women empowerment To offer suggestion for betterment of women’s empowerment through microfinance. To review the research studies related to micro-finance Objectives of Seminar

4. In India around 21.9 per cent population living below the poverty line. About 53.9 percent of the poorest households do not have access to credit. Only 15 % access loan from the formal sources Source: Indiastat , 2022 Need of micro-finance  in India

5. Current status of microfinance in India Total number of SHGs saving linked with banks - 47240.48 Total number of SHGs credit linked - 99729.22 Total number of SHGs having loans outstanding - 151051.30 Average loan amount outstanding/SHG (in R) - 2.24 800 MFIs are working in India Average loan amount disbursed/SHG - 2.93 Current Status of micro-finance in India Source: Status of Micro-finance in India- 2022 , NABARD

6. Figure : Microcredit portfolio (Rs Cr) Source: Equifax, data from Mar-19 onwards based on portfolio originated after Feb-17

7. 1. CONCEPT OF MICRO-FINANCE Activities of Micro-Finance Micro-finance  involves the activities like Small loan for working capital, Collateral securities such as group guarantees or compulsory savings, Access to repeat and larger loans based on repayment performance, Streamline loan disbursements and monitoring Secure savings . Rao and Sharma (2006)

8. Self Help Group- Bank linkage model Micro-finance Institution Model (MFI) Grameen Model Individual Lending Microfinance Models in India > 97 per cent of Microfinance business

9. It is the dominant microfinance methodology in India. Started as a pilot project in 1992 by NABARD. SHGs were linked to banks. THE SELF HELP GROUP-BANK LINKAGE MODEL

10. WORKING OF SHG- BANK LINKAGE MODEL

11. TYPES OF SHG-BANK LINKAGE MODEL Model Type I Banks forms SHGs and finance them II I NGOs forms SHGs and banks finance them III NGOs and other agencies, as financing intermediaries between banks and SHGs

12. Micro-finance Institutions ( MFls ) MFIs include NGOs, trusts, NBFCs, These lend small sized loans to individuals or SHGs. They also provide other services like capacity building, training, marketing of products etc . Example – Bhartiya Samruddhi Investments and Consulting Services Ltd. (BASICS Ltd) in Hyderabad MICRO-FINANCE INSTITUTIONS MODEL (MFI)

13. WORKING OF MFI MODEL

14. Insufficient loan amount High interest rate (12 to 36% p.a. ) Low recovery of loans Regional Imbalances in formation of SHGs High level of illiteracy and lack of organizational experience of most members is a constraint for most SHG members in performing this role (Risk management, repayment monitoring, financial management, accountability etc.) PROBLEMS IN MICROFINANCE

15. 2. ROLE OF MICRO-FINANCE IN WOMEN EMPOWERMENT The role of Micro-finance contributing for women’s empowerment includes • Economic empowerment • Social empowerment: • Education, skill and training empowerment: • Political empowerment :

16. Micro-finance in economic  empowerment Enhances the women’s contribution to the household’s income as a result of credit access. • Helps in employment generation, • Helps in understanding the bank transactions. • Improves women’s access and control over the resources.

17. Micro-finance in social empowerment Roles include, • Micro-finance helps women to gain confidence, • Helps to gain respect in the family, • Increase the role of women in household decision making, • Improves the ability of women to freely interact with members of the group and outsiders and • Increase mobility of women within and outside their locality.

18. The success of MFIs in India is a big challenge for all concerns like Government, NGOs, SHGs, borrowers etc. Government should come forward in a manner to provide quick delivery of microfinance to the poorer and needed people. Government should formulate acts as per requirement of different stakeholders of Microfinance. Microfinance must be provided as per the needs of small entrepreneurs. The quality of SHGs is a major factor for the success of Micro finance programme Government should check the group quality and of financial sustainability of MFIs. The microfinance services should be reached to poor people of all areas for balanced growth. It is essential to engage this section of society in the economic mainstream to achieve balanced growth which is critical for the long term sustainability of social development and economic prosperity. 4 Suggestion for betterment of women’s empowerment through microfinance.

19. 5 . RESEARCH STUDIES RELATED TO MICRO-FINANCE

20. Research Study 1. Title of the study: Role of Micro-finance in women’s empowerment (A study in Pondicherry region rural SHGs) Authors: Sarumathi , S, and Mohan, K. Year: 2011

21. Locale of the study- Rural areas of Pondicherry region Selection of SHG- Six SHGs promoted by NGO were selected Selection of respondents-181 SHG women members Members who are engaged in micro enterprises through microfinance were selected for the study METHODOLOGY

22. Table 1. Perception of members about reduction in poverty level due to micro finance Findings Category Number Percentage To greater extent 167 92.26 To some extent 14 07.74 To lower extent 0.00 Total 181 100 (n=181)

23. Table 1: Social empowerment of women members FINDINGS

24. Table 3: Cross tabulation of psychological variables with different age groups Findings

25. Research Study 2. Title  of the study: “ROLE OF MICROFINANCE IN WOMEN EMPOWERMENT IN INDIA” Authors: Dr. Shuchi Loomba Year: 2011

26. Area of Sampling: The study was conducted in the district of Ghaziabad Sample Size: 50 samples from 3 SHGs Statistical tools: Simple correlation coefficient, paired t-test, cross tabulation and percentage analysis are used for the analysis of the data. Research Methodology

27. Data Analysis and Findings

28. Paired t-test Hypothesis: H0= There is no difference in mean income of respondents before and after joining SHG.

29. CONCLUSION CONCLUSION Micro-finance has been  proved to be an important tool in the development process empowering the rural poor women educationally, socio-economically and politically. Impact of micro-finance is appreciable in bringing confidence, courage, skill development and empowerment among rural poor women.