Financial Inclusion Conference 2012 - Summary of Day Two

“The Seven Steps to Save the Soul of Microfinance”

Mr Larry Reed, Director, Microcredit Summit Campaign started the first session of the day by re-emphasizing the need to view Microfinance as a poverty alleviation tool and listed seven steps, which in his view were important for the future of microfinance:

• Recognize excellence:  Recognizing that clients are the ones who are striving to get out of poverty and microfinance is merely a tool. He spoke of the need to learn from successes (best-case practices) in the sector.
• Be Transformative: Acknowledging that microfinance is only one tool to eradicate poverty and not the only tool, and needs to combine with other products meeting the clients’ needs.

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Microfinance and Inclusive Growth: What are the measures of Success or learning?

This post is the detailed description of session one of the Financial Inclusion 2012 Conference. The aim of this session was to lay out the distinct features of microfinance that have a positive impact on the lives of its clients. The panel set out to review the lessons learnt from the sector and reflect on its mission. The discussion was moderated by  Mr. Matthew Titus, Executive Director of Sa-Dhan who expertly steered the discussion as well as involved members of the audience to gain a holistic picture of the challenges and ideals facing the sector.

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Financial Inclusion Conference 2012 - Summary of Day One

The tenth edition of the Financial Inclusion Conference, jointly organised by Sa-Dhan and FICCI opened today in New Delhi. Welcoming the participants, Mr Mathew Titus, Executive Director, Sa-Dhan said that there are challenges in fulfilling the mandate of financial inclusion, which need to be addressed. To view the session plan for Day One ...

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Eye in the Sky - Role of Government - Intervene, Interrupt or Supervise?

A day ago, I came across this headline, "Bangladesh government prepares to take control of Grameen Bank" from David Roodman's tweet feed and I also read the article, "Cabinet okays amendment to Grameen Bank ordinance". A few minutes ago, Muhammad Yunus' reactions has been posted in his respective website [Click here to read]. Also, read what David has said about the recent turn of events [Link]

I find the turn of events to be rather puzzling. Yes, it does bear a strange an uncanny resemblance to the movies, where the hero after successfully having thwarted all the bad guys has to give in to the Police and other authorities. Where were they in the first place? The Grameen Bank Ordinance now allows the Chairman of the Board to choose the Managing Director of the microcredit firm single-handedly. The Chairman of the Board will be a person appointed by the Government. Is it just me or is democracy getting stifled here?

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Digital Data Collection Vs. Data Collection on Paper

While digital data collection is a significant departure from the usual paper and pen data collection method, there are both advantages and disadvantages to each data collection method.  However, digital data collection is a step into the future because it allows for integration of data collection, data entry and data checks much more efficiently over a shorter time frame.  Before making a decision to use digital or paper formats, the management must keep the cost, quality, staff quality and infrastructure issues in mind. The following table highlights the differences between these methods of data collection:

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News Summary: MFIs still struggling to get funds..!

Microfinance news summary (June 15- June 30)

According to the first edition of Microfinance Institutions Network (MFIN)’s quarterly report, MFIs located outside Andhra Pradesh (AP) has shown growth during 2011-12 with gross loan portfolios growing by 22% over the previous year. However, if AP is also included, the gross loan portfolios shows a decline of 15% compared to previous year. In AP alone, the portfolio decreased by 38% over the previous area. 

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Introducing CMF's Thematic Factsheets

Over the past seven years, the Centre for Microfinance (CMF) has conducted and implemented several impact evaluation studies, mostly using randomized controlled trials. A new series of factsheets by CMF compiles results from several rigorous studies in a given field (including studies by CMF and several conducted by external researchers),  as well as providing context for recent and upcoming policy initiatives pertaining to the same.


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Is microfinance responsible for everything?

"Profiteers have hijacked the microfinance".. that is what a new book written by Hugh Sinclair alleges. I am not denying that many from this industry are making profit. However, time and again, i am tempted to ask the critics of microfinance if they can answer what would happen to microfinance clients in the absence of microfinance. Why do clients take loans from microfinance? Or in the absence of microfinance, will banks reach out to these low income clients?


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Where do Interventions Come From?

I came across a reference to a paper that was written in the 1800s (in Dublin), where the 


researcher attempted to help the poor in his neighborhood by employing them in spinning 


linen-yarn. He reflects on some of the limitations of his endeavor:


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Microfinance - new direction or lost in implementation?

Some argue that microfinance alleviates poverty and some claim that microfinance causes over-indebtedness among the poor and thus, it has become even more important to understand the effective of microfinance. This article talks about research findings from two randomized evaluations - one from rural areas of Morocco and the other from Kolkata, India (which is also a CMF study).

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MBVF and MFI: Similar yet Different?

Keen readers of microfinance blogs might recall David Roodman making this post awhile back on a quasi-experimental evaluation of Microcredit provision in Thailand where Kaboski & Townsend used an exogenous policy initiative, the “Million Baht Village Fund (MBVF)”, as a proxy to investigate the impact of microcredit provision. 

The full paper was recently published in Econometrica and, being foreign to the Indian Microfinance scene, I thought it might be interesting to see if a simple cross-country comparison could contribute to the generalizability of impact evaluations that CMF conducts in India, such as the widely-cited Spandana study.

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Savings Dilemma

We often come across people who say that they are not earning enough to save or do not see how a savings account would help them. More often than not, as laymen we believe the story and even empathise with such people. As a researcher working at the Centre for Micro Finance, I have had this discussion many times with my colleagues and their thoughts on making a savings account mandatory for all the citizens of the country. As a colleague puts it, “I should not have an option to have a savings account, rather I should be born with one”, but the fundamental question is – Is the possession of a savings account sufficient enough, how important is it to maintain one? There is endless debate in the academic world on how a commitment savings product is more useful or how a savings product which gives more flexibility can encourage people to save more. But these are mostly product features, how do you convince people with the mindset, “I do not see any value in a savings account at all?”

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Short-Sighted on Regulation?

A look at most news channels and even the financial news channels may not be a pleasant experience these days. The word 'crisis' has become a very commonly used word. Much of it has been reported, the question remains as to how many has understood the problems and challenges as far as financial services for the poor are concerned. What set out to alleviate the poor and their general welfare now needs a great deal of regulation and scrutiny.


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Microcredit: Hero or Anti-Hero?

Is the glass half empty or half full? For the meaning of this phrase, click here

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Map of Microfinance Distribution in India

If you are interested in understanding financial inclusion in India, have you ever wondered about the penetration of financial services in India at state-wide or district-wide level? Have you ever wished to explore this penetration across various demographic and socio-economic strata? If so, Centre for Micro Finance is happy to announce that your wish has come true.

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