The Microfinance Review

Open Access Open Access  Restricted Access Subscription Access
Open Access Open Access Open Access  Restricted Access Restricted Access Subscription Access

Self-Help Group-Bank Linkage Programme:Issues and Way Forward


Affiliations
1 Micro Credit Innovations Department, NABARD, Mumbai, India
     

   Subscribe/Renew Journal


The women-centric development initiative in the form of SHGBank Linkage Programme (SBLP) has moved ahead, leaving behind all trepidations like SBLP losing contextual relevance, especially due to the emphatic emergence of alternative channels like Microfinance Institutions (MFIs). The horizontal and vertical expansion of SBLP, rise in disbursement of bank loan to SHGs, both in absolute and relative terms and the fall in Non Performing Assets (NPA) during 2015-16 reaffirms the strength of SBLP. The Southern orientation has been receding continuously, mainly due to special focus by NABARD and state governments in deficit states. States like Maharashtra, Odisha, Rajasthan, Uttar Pradesh and West Bengal witnessed increased bank credit deployment to SHGs. The NPA level has declined by about one percentage point to 6.4% in 2015-16, contrary to the overall trend of NPA in the banking sector. SBLP on the one hand was used as a platform for launching poverty alleviation and rural development programmes by various state governments and on the other, support of government machineries strengthened SBLP. Over the years, innovations, policy formulations, capacity-building, livelihood initiatives, and support from stakeholders established SBLP as the most widespread financial and economic linkage programme for the bottom of pyramid. This paper broadly brings forth the issues and challenges in furtherance of SBLP, recounts the status of SBLP with respect to growth, distribution and penetration across the regions; convergence of various programmes, microfinance under MFI model and underlines the way ahead in ensuring total coverage of rural households under institutional credit and financial penetration. The inferences in the paper are based on analyses of secondary data collected from various sources.


Keywords

SBLP, Business Correspondents, MFIs.
User
Subscription Login to verify subscription
Notifications
Font Size

  • - GIZ (2015): “SHG Member as Bank Agents – The Bank Sakhi Model: Approach and Lessons from Two Pilot Projects”, Rural Financial Inclusion Programme, GIZ, New Delhi.

  • - Government of India (2014): “Census of India: Analytical Report on Primary Census Abstract, Directorate of Census Operations”, Madhya Pradesh, Ministry of Home Affairs, GoI, New Delhi.

  • - Misra, Alok (2016), “Responsible Finance India Report 2015 Client First: Tracking Social Performance Practices”, Access Development Services, New Dehi.

  • - National Bank for Agriculture and Rural Development (2013): “SHGs: Paving Pathways to Possibilities”, Micro-Credit Innovations Department, NABARD, Mumbai.

  • - (2016): “Status of Microfinance in India 2015-16”, Micro-Credit Innovations Department, NABARD, Mumbai.

  • - (2016a): “Micro Enterprise Development Programme – A Beacon for Stand Up India”, Micro-Credit Innovations Department, NABARD, Mumbai.

  • - Rangarajan C (2008): “Report of the Committee on Financial Inclusion”, viewed on 25 July 2016 (https://www.nabard.org/pdf/Full_Report.pdf)

  • - Reserve Bank of India (2005): Report of the Internal Group to Examine Issues Relating to Rural Credit and Microfinance, Chairman - H R Khan, viewed on 25 July 2016, (https://rbidocs.rbi.org.in/rdocs/ Publication Report/Pdfs/65111.pdf).

  • - (2016): Financial Stability Report, Issue No.13, June 2016, RBI, Mumbai.

  • - (2016a): Master Circular – National Rural Livelihood Mission (NRLM), viewed on 25 July 2016 (https://www.rbi.org.in/Scripts/BS_ViewMasCirculardetails.aspx?id=10494)

  • - Sa-Dhan (2015): Bharat Microfinance Report 2015, Sa-Dhan, New Delhi.

  • - Sriram M S (2016): Inclusive Finance India Report 2015, ACCESS development Services, New Delhi.


Abstract Views: 463

PDF Views: 0




  • Self-Help Group-Bank Linkage Programme:Issues and Way Forward

Abstract Views: 463  |  PDF Views: 0

Authors

B. D. Nayak
Micro Credit Innovations Department, NABARD, Mumbai, India

Abstract


The women-centric development initiative in the form of SHGBank Linkage Programme (SBLP) has moved ahead, leaving behind all trepidations like SBLP losing contextual relevance, especially due to the emphatic emergence of alternative channels like Microfinance Institutions (MFIs). The horizontal and vertical expansion of SBLP, rise in disbursement of bank loan to SHGs, both in absolute and relative terms and the fall in Non Performing Assets (NPA) during 2015-16 reaffirms the strength of SBLP. The Southern orientation has been receding continuously, mainly due to special focus by NABARD and state governments in deficit states. States like Maharashtra, Odisha, Rajasthan, Uttar Pradesh and West Bengal witnessed increased bank credit deployment to SHGs. The NPA level has declined by about one percentage point to 6.4% in 2015-16, contrary to the overall trend of NPA in the banking sector. SBLP on the one hand was used as a platform for launching poverty alleviation and rural development programmes by various state governments and on the other, support of government machineries strengthened SBLP. Over the years, innovations, policy formulations, capacity-building, livelihood initiatives, and support from stakeholders established SBLP as the most widespread financial and economic linkage programme for the bottom of pyramid. This paper broadly brings forth the issues and challenges in furtherance of SBLP, recounts the status of SBLP with respect to growth, distribution and penetration across the regions; convergence of various programmes, microfinance under MFI model and underlines the way ahead in ensuring total coverage of rural households under institutional credit and financial penetration. The inferences in the paper are based on analyses of secondary data collected from various sources.


Keywords


SBLP, Business Correspondents, MFIs.

References