sharad synopsis

8/6/2019 Sharad Synopsis

1/16

A Critical analysis of micro-finance sector for women

Empowerment in India

(With References to Branch in Indore Region)

A REVISED SYNOPSIS

For

MASTER OF BUSNESS ADMINISTRATION

Submitted to

DEVI AHILYA VISWAVIDHLAYA, INDORE

RESEARCH SUPERVISOR RESEARCHER

Prof. Vikas jain Sharad Shrivastava

Senior lecturer (Finance) MBA 2nd year

DMS, Truba College (Finance &

marketing)

Indore. Roll No. 9170016


2/16

RESEARCH CENTER

TRUBA COLLEGE OF ENGINEERING ANDTECHNOLOGY

INDORE

INDEX

1. INTRODUCTION OF STUDY

2. LITERATURE REVIEW

3. OBJECTIVE

4. HYPOTHESIS

5. RESEARCH METHODOLOGY

6. SCOPE & LIMITATION

7. ANALYSIS AND INTERPRETATION


3/16

BIBLIOGRAPHY

WEBLIOGRAPHY

REFERENCES

Introduction:

Microfinance in India started in the early 1980s with small efforts at forming

informal self-help groups (SHG) to provide access to much-needed savings and

credit services. From this small beginning, the microfinance sector

has grown significantly in the past decades. National bodies like the Small

Industries Development Bank of India (SIDBI) and the National Bank for

Agriculture and Rural Development (NABARD) are devoting significant time

and financial resources to microfinance. This points to the growing importance of

the sector. The strength of the microfinance organizations (MFOs) in India is in

the diversity of approaches and forms that have evolved over time. In addition to

the home-grown models of SHGs and mutually aided cooperative societies

(MACS), the country has learned from other microfinance experiments across the

world, particularly those in Bangladesh, Indonesia, Thailand, and Bolivia, in


4/16

terms of delivery of micro financial services. Indian organizations could also

learn from the transformation experiences of these microfinance initiatives.

UnderstandingMicrofinance

Robinson (2001) defines microfinance as small-scale financial services

primarily credit and savingsprovided to people who farm, fish or herd and

adds that it refers to all types of financial services provided to low-income

households and enterprises. In India, microfinance is generally understood but

not clearly defined. For instance, if an SHG gives a loan for an economic activity,

it is seen as microfinance. But if a commercial bank gives a similar loan, it is

unlikely that it would be treated as microfinance. In the Indian context there are

some value attributes of Microfinance

1. Microfinance is an activity undertaken by the alternate sector (NGOs).

Therefore, a loan given by a market intermediary to a small borrower is not seen

as microfinance. However when an NGO gives a similar loan it is treated as

microfinance. It is assumed that microfinance is given with a laudable intention

and has institutional and nonexploitative connotations. Therefore, we define

microfinance not by form but by the intent of the lender.

2. Second, microfinance is something done predominantly with the poor. Banks

usually do not qualify to be MFOs because they do not predominantly cater to the

poor. However, there is ambivalence about the regional rural banks (RRBs) and

the new local area banks (LABs).

3. Third, microfinance grows out of developmental roots. This can be termed the

alternative commercial sector. MFOs classified under this head are promoted

by the alternative sector and target the poor. However these MFOs need not

necessarily be developmental in incorporation. There are MFOs that are offshoots

of NGOs and are run commercially. There are commercial MFOs promoted by

people who have developmental credentials. We do not find commercial


5/16

organizations having microfinance business.

4. Last, the Reserve Bank of India (RBI) has defined microfinance by specifying

criteria for exempting MFOs from its registration guidelines. This definition is

limited to not-for-profit companies and only two MFOs in India qualify to be

classified as microfinance companies.

Microfinance in India

In India, microfinance is done by organizations having diverse orientations,

NGOs in India perform a range of developmental activities;

Microfinance usually is a sub-component. Some of these NGOs organize groups

and link them to an existing provider of financial services. In some cases NGOs

have a revolving fund that is used for lending. But in either of these cases,

microfinance is not a core activity for these NGOs. An example is the Aga Khan

Rural Support Program me India (AKRSP-I). For AKRSP-I, the microfinance

component is incidental to its work in natural resource management.

Examples like MYRADA and the Self-Employed Womens Association (SEWA)

fall in the same category. However, as their microfinance portfolios grew, both

organizations decided to form separate entities for microfinance. MYRADA set

up an MFOs called Sanghamitra Rural Financial Services (SRFS), while SEWA

set up the SEWA Cooperative Bank. At the next level, we find NGOs helping the

poor in economic activities. Their purpose is developmental. They see

microfinance as an activity that feeds into economic activities. For instance, the


6/16

South Indian Federation of Fishermens Societies (SIFFS) started as a support

organization for fishermen, providing technical and marketing support. It then

arranged for loans to its members through Journal of Microfinance

Literature Review

Impacts of micro finance on women were addressed by researchers and some

important studies are presented here. Hashemi, Schuler, Riley (1996) and

Kabeer(1998) reported that micro finance empowered women in Bangladesh,

Makumbe et al. (2005) found that microfinance has a positive impact on decision

making in Tanzania, Hulme and Mosley (1996) found growth of income of

microfinance borrowers in Indonesia, India, Bangladesh and Sri Lanka, Mk Nelly

et al. (1996) found positive benefits in Thailand, Chen and Snodgrass (2001)

reported income increase in India, Pitt and Khandker (1998) quoted positive

impact of per capita income, household expenditure and increase in non-land

assets in Bangladesh, Goldberg (2005) informed poor no longer remained as poor

as a result of micro finance in Bangladesh. Navajas et al. (2000) studied micro

finance in Bolivia and reported majority of clients were below poverty line and

similar conclusions were reported by ACCION (2003) in Lima and Peru and

Stanton (2002) in Mexico. Khandker (2004) found that micro finance helped in

poverty reduction and Zubair (2004) reported reduced vulnerability to domestic


7/16

violence in Bangladesh. Studies carried out by Schuler, Hashemi and Pandit

(1995) for India, Mayoux (2001) for Cameron and Schuler, Jenkins and

Townsend (1995) for Bolivia indicated that there is no positive effect of micro

finance. Zeller (1994) found that wealthier households are benefited in

Madagascar; Datta (2004) eported that 59 per cent microfinance clients in

Bangladesh are better off poor. Coleman (1999) reported noevidence of

programme impact in Thailand and during 2004 he reported that the programme

did not reach poor and impact is larger on Committee Members. Duong and

Izumida (2002) reported that poor have difficulties in accessing credit facilities

in Vietnam and Amin et al. (2003) reported that poor and vulnerable are excluded

in Bangladesh. Matin and Hulme (2003); Halder and Mosley (2004) reported that

political and social connections instead of poverty status decides the selection of

participants in Bangladesh. Maggiano (2006) studied the impact of micro finance

in Uganda and concluded that there is a measurable impact on social development

but no impact on economic development. Ssendi and Anderson (2009) observed

that there are some benefits to poor women and two third poor women remained

as before in Tanzania.

What Is Microfinance?

Microfinance, according to Otero (1999, p.8) is the provision of financial

services to low-income poor and very poor self-employed people. These

financial services according to Ledgerwood (1999) generally include savings and

credit but can also include other financial services such as insurance and Payment

services. Schreiner and Colombet (2001, p.339) define microfinance as the

attempt to improve access to small deposits and small loans for poor households

neglected by banks. Therefore, microfinance involves the provision of financial

services such as savings, loans and insurance to poor people living in both urban

and rural settings who are unable to obtain such services from the formal

financial sector.

1. Women In Micro Finance


8/16

In developing countries, women play a pivotal role as risk managers and drivers

of development, particularly in settings of severe poverty. Microfinance programs

have enabled thousands of women to use small sums in creative and successful

ways to develop livelihoods, improve their families well-being, and build up

savings. However, microfinance has proven limited in its ability to really

empower women, create upward mobility, and contribute to long-term economic

growth. More is needed if we are to help the poor, especially women, move

beyond subsistence-level, small income generating activities to become full social

and economic participants in their country. There are four basic views on the link

between micro-finance and women's empowerment:

There are those who stress the positive evidence and are essentially optimistic

about the possibility of sustainable micro-finance programs world-wide

empowering women;

Another school of thought recognizes the limitations to empowerment, but

explains those with poor program design;

Others recognize the limitations of micro-finance for promoting empowerment,

but see it as a key ingredient as important in themselves within a strategy toalleviate poverty; empowerment in this view needs to be addressed by other

means;

Then there are those who see micro-finance programs as a waste of resources.

2. Womens empowerment and micro-finance: contrasting

paradigms

From the early 1970s, womens movements in a number of countries identified

credit as a major constraint on womens ability to earn an income and became

increasingly interested in the degree to which poverty-focused credit programs

and credit cooperatives were actually being used by women. SEWA in India, for

example, set up credit programs as part of a multi- pronged strategy for an

organization of informal sector women workers. Since the 1970s, many womens

organizations world-wide have included credit and savings, both as a way of


9/16

increasing womens incomes and to bring women together to address wider

gender issues. In he 1990s, a combination of evidence of high female repayment

rates and the rising influence of gender lobbies within donor agencies and NGOs

led to increasing emphasis on targeting women in micro-finance programs.

SECTOR

Micro finance provider are classified into three categories as follows

Formal sector :-It covers the entire banking industry including all public,

private, regional rural bank, NABARD and RBI.

Semi-Formal sector :- It covered exclusive micro- financing institution ,

NGOs and various self helping group (SHG).

Informal sector :-It covered family, friends relatives, trand etc.

Generally, the micro finance products are classified into three categories -Micro

Credit, Micro Savings and Micro Insurance. Various credit products are available

ranging from consumption to production besides savings products. However, micro

insurance is still in experimental stage.

Objective

Any activity done without an objective in a mind cannot turn fruitful. An

objective provides a specific direction to an activity. Objective may range from

very general to very specific, but they should be clear enough to point out with

reasonable accuracy what researcher wants to achieve through the study and how

it will be helpful to the decision maker in solving the problem. The main


10/16

objectives behind the study are as follows:

To study of women empowerment, improvements of society

To study the impact on person belong BELOW POVERTY LINE

To study of micro finance SELF HELPING GROUP

To study of awareness about micro-finance.

Hypothesis

Ho:There is impact on Economic independency strengthen and boost upwomen empowerment level.

H1:There is no impact on Economic independency strengthen and boost up women empowerment level.

Research Methodology

Two type were take into consideration i.e. primary data and

secondary data but major emphasis was given on gathering the

secondary data. Only to supplement the primary and make thing

Primary data :- primary data are those which are

collected afresh and

for the firstTime, and thus happen to be orignal in character.

Secondary data:- the secondary data, on the other hand , are those


11/16

which have already been collected by some one else and which

have already been passed through the statistical prosses.

DATA SOURCE

To satisfy the objectives, the primary data has been collected with

the help of a structured questionnaire. A convenient randomized

sample of 100 women respondents from the aforesaid blocks was

selected. Chi-square test, weighted average scores and percentages

have been used to draw the meaningful inferences from the study.

And secondary data are using from Empirical study collected to the

various sources

Internet

References from books

Journals and magazines.

Past Research based data

Data Analysis Methodology

o Percentage Analysis

o Weighted average

o Profitability ratio

o Activity ratio

Expected Contribution of Research

Women clients who have become business leaders are more exceptions to the rule


12/16

than the norm. However, they can help make a business case for paying more

attention to the full package of business development, support networks and

financial services that women need to help them move up. If MFIs and banks are

able to think about women as emerging market opportunities, and market

research as well as impact data could be designed with an end outcome on

products and services specifically designed for women, we may see a significant

improvement in client retention and risk reduction, not to mention fulfillment of

social performance. Ultimately, empowering women requires fundamental

changes within each country context. It necessitates more direct policy

instruments that can replace the rules sustaining gender inequality and establish

incentives that will improve access to and quality of education as well as offer

opportunities for professional advancement. Fundamental change such as this

does not happen easily or quickly; at least in the near term, however,

microfinance offers one platform for change. Whereas the last decade has seen a

move away from the multi-sectoral development approaches of the 1980s, and

towards microfinance as a separate activity to better track costs and measure

sustainability, it may be time for a modified version of integrated service delivery

to make a comeback. Armed with better market research methods and simplified,practical impact information that feeds back into developing better products and

services, we will realize that the key to improved service delivery is what we

knew from the beginning: Know your customer

Scope


13/16

Evidence suggests that, even in financially successful microfinance programs,

actual contribution to empowerment is often limited:

Most women remain confined to a narrow range of female low-income

activities.

Many women have limited control over income and/or what little income they

earn may substitute for former male household contributions, as men retain more

of their earnings for their own use.

Women often have greater workloads combining both production and

reproductive tasks.

Womens expenditure decisions may continue to prioritize men and male

children, while daughters or daughters-in-law bear the brunt of unpaid domestic

work.

Where women actively press for change, this may increase tensions in the

household and the incidence of domestic violence.

Women remain marginalized in local and national level political processes.

This is not just a question of lack of impact, but may also be a process of

disempowerment:

Credit is also debt. Savings and loan interest or insurance payments divertresources which might otherwise go towards necessary consumption or

investment.

Putting the responsibility for savings and credit on women may absolve men of

responsibility for the household.

Where group meetings focus only on savings and credit, this uses up womens

precious work and leisure time, cutting program costs but not necessarily

benefiting women.

Limitations

Repayment pressures may increase tensions between women and/or lead to the

exclusion of the most disadvantaged women who may then be further

disadvantaged in markets and communities. Impacts are therefore very complex.

Women themselves are not passive victims, but active participants using

opportunities as best they can in the context of the many constraints of gender

inequality and poverty. There may be trade-offs for individual women because of


14/16

reinforcing and conflicting opportunities and constraints. At both household and

community level different women may be affected in different ways

Lack of knowledge of the market and potential profitability, thus making the

choice of business difficult.

Inadequate bookkeeping.

Employment of too many relatives which increases social pressure to share

benefits.

Setting prices arbitrarily.

Lack of capital.

High interest rates.

Credit policies that can gradually ruin their business (many customers cannot

pay cash; on the other hand, suppliers are very harsh towards women).

ANALYSIS AND INTERPRETATION

Book references

1. IIB, Bank Financial Management, 2010 Macmillan Publishers

2. Research mathology by R. PANNEERES LVAM

3. Research methodology:, methods & technilogy: by C.R. KOTHARI

4. financial management & system:,by I.M. PANDAY

5. news paper

6. magazines

7. journals


15/16

Bibliography

Nirmala .K.A. and Geetha Mohan 2009. Socio-economic impact of microcredit:A

Study of Measurement, in Anil Kumar Thakur and Praveen Sharma(ed). Micro

credit and Rural Development,pp207-224. Deep&Deep Publications: New Delhi.enterprise development, IT Publication London.

Downing, J. 1990, Gender and the growth dynamics of microenterprise,

Development Alternatives Inc., Washington, DC. Mayoux, L. 1998a,

Microfinance programmes and womens empowerment: Approaches, evidence

and ways forward, Discussion Paper, Open University, Milton Keynes.

Mayoux, L. 1998b, Participatory programme learning for womens

empowerment: negotiating complexity, conflict and change, IDS Bulletin, 29(4).

Mayoux, L. 1999, Questioning virtuous spirals: Microfinance and womens

empowerment in Africa, Journal of International Development, December.

Mayoux, L. 2000, Microfinance and the empowerment of women: A review ofthe key issues, Social Finance Unit Working Paper, 23, ILO, Geneva.

Small Enterprise Development, An International Journal Vol 9 No.3, September

98, 1998,72p.

Balancing the double day: Women as managers of

microenterprises, Eliana Restrepo Chebair y Rebecca

Reichmann, ACCION Internacional, Monograph Series No.10,

Colombia, 1995, 84p.

Women in Micro-and Small-scale enterprise Development, Louise

Dignard and Jos Havet, IT Publications, USA, 1995, 282p.

Women entrepreneurs, catalysts for transformation, Diane Chamberlin Starcher,

Leith Editorial Services, Great Britain, 1996, 30p.

WEBLIOGRAPHY:-

www.google.com


16/16

www.apmas.org

www.ijeronline.com

www.scholarshub.net

sharad synopsis

Documents