icici microcredit initiative

8/8/2019 ICICI Microcredit Initiative

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Industrial Credit and Investment

Corporation of India (ICICI)

Presented by Group 6

Vivek Agrawal 203

Bhupesh Chandel 208

Vinay Chokhra 209

Krishnadeep Gupta 212

Kriti Gupta 213

Shubhra Sanghi 229

Corporate

SocialResponsibility

Project

Microcredit Initiative


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Microcredit

Very small loans

Unsalaried borrowers (no/little collateral)

Provided by legally registered institutions.

Microfinance

Broader range of financial services

Wider range of opportunities

Microcredit, micro savings, micro insurance, housing loans etc

Targeted at poor and low-income group

What is


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History of microfinance in India

Substantial resource allocation to microfinance post

nationalization in 1969

Credit flow remained an issue to certain segments of rural poor

Institution driven microfinance(Launch of NABARD)

Launch of IRDP

NABARD and MYRADA work

Swarnjayanti Gram Swarozgar Yojna(SGSY) in 1999

SHGs, JLGs and MFIs


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Agriculture

, 13%

Livestock,

23%

Trade, 33%

Services,

25%

Others, 6%

Production

, 10%

BREAKUP OF ACTIVITIES UNDERTAKEN BY BORROWERSSource: SKS Microfinance Ltd.

Source: SKS MFI


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Source: SKS Microfinance Ltd.


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ICICI Initiatives in Microcredit

Started with only 1 million customer base now 3.5 million

Collaborated with NGOs and Micro Finance Institutions (MFIs) to minimizecost and extend the network more than 200

Dedicated department : Rural Micro-Banking and Agri- Business (RMAG) for

implementing rural business strategy including Microfinance Portfolio Rs. 25

billion

GOALSICICIHAD

Increase bankpenetration in

rural areasPrepare forincreasing

purchasing power

of ruralhouseholds

Supportdowntrodden as

good corporatecitizens


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Direct Access Model: Bank-Led Model

ICICI Bank of Madura merger 01 Feb

2001

ICICI Sangli Bank merger 09 Dec 2006

Indirect Channel Model: Partnership-

Led Model

ICICI MFI Relation

ICICI Models of MicrocreditBank

Branch

SHG NGO

Bank

MFI

Ind/SHG/JLG


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ICICI Microcredit. A success story

Financial assistance to MFIs : Term loans, overdraft and portfolio buyout

MFIs have First Loss Default Guarantee (FLDG) with bank

Buys unencumbered, direct agricultural and/or weaker section

portfolios, originated by the MFI (registered as NBFC) through the processof Direct Assignments.

Provides basic banking services like savings and withdrawal along with

micro-investment products like mutual funds to the rural populace

Case in study : ICICI Bank purchased a portfolio of 42500 loans worth USD

4.3 million from Share Microfin Limited in 2004

Farmer Service Centers


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SelfHelp Group (SHG)/Joint Liability Group

(JLG) - Model

Affinity group of 10-20 members

Weekly group meetings

Leader elected by group members

Small and regular savings

Group has a savings bank account operated by group

representative

Internal lending to members from own savings

External loan to the Group as a whole

Disbursement of loans to members at the discretion of group


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Microfinance ICICI initiatives

Micro Savings account Business Correspondent, Financial

Information Network and Operations (FINO), Smart Card, Savings

Account

Recurring & Fixed Deposit account to enable higher returns

ICICI Life provides Micro Insurance

ICICI General provides non-life insurance including

health, weather and cattle insurance

ICICI AMC launched Indias first MSIP with minimum amount as

low as USD 1


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Micro ICICI Godown Security System loans against the produced

stored in warehouse

No white spaces strategy touch point within 10 kms. of any

customer

Kamdhenu Cattle Loans campaign to cattle farmers which

received two awards; RMA India Award and WOW Events and

Experiential Marketing Awards

Microfinance ICICI initiatives contd.


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0

100000

200000

300000

Current

Microcredits

by MFIs

Total

microcredit

demand

(India)

30000

300000

Projected Microcredit demand in crores

Growth Opportunities..

Source: SKS Microfinance Ltd. (EDA rural report

Maturing of Indian Microfinance, World

Bank)


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QUESTIONS


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THANK YOU

icici microcredit initiative

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