Indian Journal of Economics and Development

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Operation, Issues and Challenges of Microfinance in India


Affiliations
1 Dept. of Commerce & Management, University College of Arts, B. H. Road, Tumakuru—572103, India
2 Dept. of Economics, University College of Arts, B. H. Road, Tumakuru—572103, India
 

Objective: The main objective this paper is to understand the concept of microfinance, the operation and to identify the latest issues, problems and challenges in effective implementation of various Microfinance programmes.

Method: Secondary data forms the basis for this paper as the study is descriptive in nature. Books, various websites, magazines, newspapers, and publications of recent research papers available in different websites are the sources of data.

Findings: The study reveals that While Micro Finance Sector seems to be growing fast with no road blockages, it has also brought to fore several challenges and issues. Some of such issues are: providing varietal savings avenues to the micro finance beneficiaries, and mobilization of such savings by MFIs, creating regulatory frame work for MFIs, provision of finance to MFIs as a regular channel of finance/refinance, reduction in cost of resources/management resulting in lending rates for micro finance beneficiaries, safety and precautions for MFIs entering into new financial services like micro leasing, insurance, housing, medical services etc.

Applications: This paper provides a platform for researchers to understand the problems and challenges in effective implementation of various Microfinance programmes.


Keywords

Challenges, Issues, Micro Finance, Mutual Financial Institutions’, Poverty Alleviation, SHGs, Women Empowerment.
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  • B.M. Desai, N, V. Namboodri. Organization and Management of Rural Financial Sector. Text, Cases and Exercises, Oxford and IBH Publishing Co, New Delhi. 2001.

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Abstract Views: 297

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  • Operation, Issues and Challenges of Microfinance in India

Abstract Views: 297  |  PDF Views: 601

Authors

R. C. Nagaraju
Dept. of Commerce & Management, University College of Arts, B. H. Road, Tumakuru—572103, India
V. Ramesh Reddy
Dept. of Economics, University College of Arts, B. H. Road, Tumakuru—572103, India

Abstract


Objective: The main objective this paper is to understand the concept of microfinance, the operation and to identify the latest issues, problems and challenges in effective implementation of various Microfinance programmes.

Method: Secondary data forms the basis for this paper as the study is descriptive in nature. Books, various websites, magazines, newspapers, and publications of recent research papers available in different websites are the sources of data.

Findings: The study reveals that While Micro Finance Sector seems to be growing fast with no road blockages, it has also brought to fore several challenges and issues. Some of such issues are: providing varietal savings avenues to the micro finance beneficiaries, and mobilization of such savings by MFIs, creating regulatory frame work for MFIs, provision of finance to MFIs as a regular channel of finance/refinance, reduction in cost of resources/management resulting in lending rates for micro finance beneficiaries, safety and precautions for MFIs entering into new financial services like micro leasing, insurance, housing, medical services etc.

Applications: This paper provides a platform for researchers to understand the problems and challenges in effective implementation of various Microfinance programmes.


Keywords


Challenges, Issues, Micro Finance, Mutual Financial Institutions’, Poverty Alleviation, SHGs, Women Empowerment.

References