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Microfnance in India

INTRODUCTION

Micro-Finance reers to ―small savings, credit and

insurance services etended to sociall! and

economicall! disadvantaged segments o societ!,

or ena"ling t#em to raise t#eir income levels and

im$rove living standards%

T#e main aim o Micro-Finance is too $rovide loan

to t#e $oor $eo$le or to "elo& $overt! line, o

are not a"le "orro& rom ot#er sources and to

ma'e t#eir living standard "etter%

One o t#e greatest c#allenges "eore t#e Indian

su"- continent ic# accommodates more t#an

one-t#ird o t#e $o$ulation is $overt!% India, one o t#e (RIC nations &it# more t#an )%* "illion

 $o$ulation is seen "! man! develo$ed countries as

an emerging econom!%

India+s economic gro&t# #as ailed to ma'e a

signifcant im$rovement in its $overt! fgures &it#

  millionmore t#an t#e total in t#e $oorest

 .rican Nations- still stuc' in $overt!% /overnment

o India &it# its concern started various $overt!

alleviation $rograms "ut t#e! #ave ailed to

deliver t#e o"0ectives to t#e level ic# is desired%

T#e reasons ma! "e man! suc# as ailure to reac#

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t#e target grou$, loo$#oles in t#e s!stem,

develo$ing a ro"ust mec#anism to name a e&%

Man! countries including India e$erimented &it#

su"sidi1ed credit ic# onl! led to increase in t#eN2.s%

T#e microfnance #as come or&ard to fll u$ t#e

ga$% (ut t#e outreac# is too small as com$ared to

t#e re3uirement and $otential% 4o&ever t#ere is

some $rogress in t#is regard ater active role

 $la!ed "! N.(.RD and ormation o 54/s grou$s%

 . num"er o N/Os and MFIs #ave also delved intot#e "usiness% 5ome o t#em #ave also started in a

"ig &a! and #ave started ma'ing $roft "! issuing

I2Os 6Initial $u"lic o7ers8% (ut certain

develo$ment in recent !ears #as "roug#t a res#

ocus on t#e $ro"lem o regulation in feld o

microfnance% T#e $a$er delineates t#ree distinct

as$ects o microfnance, frst gro&t# omicrofnance in India and some ot#er countries9

secondl! it discusses t#e role $la!ed "! N.(.RD

and ot#er National (an's in gro&t# o 54/s and

/rameen (an'% T#ird, it deals &it# t#e role o

government in raming legislation or $rotection o 

rig#t o micro "orro&ers% T#e stud! also deals &it#

t#e need or a regulator! "od! to regulate,develo$ and guide t#e numerous MFIs and N/Os

o &or' in t#e feld o microcredit% T#e $a$er

discusses t#e actors and t#eoretical $osition

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associated &it# evolution o microfnance and its

role in glo"al scenario%

O"0ective: 

(usiness Model o /rameen (an', 54/;s

 Formation o /rameen (an', 54/;s

Role o Micro Finance in t#e current econom! 

5tud! a"out t#eir interest rates

 Role o &omen in t#e econom! 

Understand t#e (usiness Model o N.(.RD

 .nd researc#ed man! im$ortant t#ings

related to Micro Finance%

Researc# Met#od:

T#e data constitute "ot# $rimar! and

secondar! data% T#e $rimar! data used in t#e

stud! &as collected t#roug# intervie&

sc#edule and 3uestionnaire%5econdar! data are collected t#roug#

internet and data availa"le rom $revious

 $u"lications in leading 0ournals%

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