Transcript Objective of the study-

INTRODUCTION
1. REASONS FOR SELECTING MICROFINANCE
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To get more understanding about SHGs and their microfinance operations.
2. WHAT IS SHG?
3. WHY MICROFINANCE?
4. SERP ROLE.
OBJECTIVE OF THE STUDY-
The broad objectives are to study the microfinance operations in
Bibinagar mandal of Nalgonda district and mainly focus on:
•study Institutional aspects of the CBOs
•Study about Bookkeeping
•Study about thrift, credit and other financial services.
•Study of Bank Linkage Programme
• welfare and social empowerment of members.
•Impact of SHG-BANK linkages programmes.
•The impact of microfinance on SHGs
•The socio-economic impact on the members of the SHGs
•Technology initiatives in the mandal.
METHODOLOGY
Primary sample survey
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Questionnaire.
2. Secondary data from
SHGs
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Banks
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Vos and Mandal Samakhyas
3. Focus group discussions.
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SAMPLING DESIGN AND DATA COLLECTION:
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In the first step five villages of the mandal were randomly selected.
Households of each village were stratified into landless, marginal (less than
2.5 acres), small (2.5 to5 acres), medium (5 to 10 acres) and large (more
than 10 acres) farm category.
From each village, 1 SHG is selected and 2 SHG members are selected.
Thus, totally 20 SHG members were selected by using random sampling
method.
demographic profiling of the families.
borrowing and saving details,
involvement in SHG were elicited from these households by using well
structured schedule.
CONCEPTS AND ANALYTICAL FRAMEWORK:
The study covers a wide array of Topics such as:
-understanding of SHG meeting process,
-understanding of bookkeeping aspects,
-understanding of savings and bank linkage
programme and
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THE CONCEPTUAL THINKING BEHIND THE SHG PHILOSOPHY AND THE
BANK LINKAGE COULD BE SUMMARIZED AS FOLLOWS: 
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Self Help supplemented with mutual help can be a powerful vehicle for the poor's
effort to socio-economic upward transition
Participative financial services management is more efficient and responsive.
Poor can save and are bankable
The mismatch between the expectations of the poor and capabilities of the formal
banking system needs to be minimised
Poor need not only credit support but also savings and other services
Small affinity groups of the poor, with initial outside support, can effectively manage
and supervise micro credit among their members
Collective wisdom of the group and peer pressure are valuable collateral substitutes
SHGs could be a pre- microenterprise stage for a majority of rural poor
SHGs facilitate wider outreach, lower transaction cost and much lower risk costs and
Empowerment of poor especially of poor women, is a major outcome
BOOKKEEPING RELATED:
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SERP standard books of Accounts have been introduced in all SHGs
Hither to NABARD SAP books were used and SHGs switch over to SERP
books of accounts.
The following are the books of accounts:
Cash Book
Attendance cum Savings Book
Loan Ledger
Individual Pass Book
Bank Book
Monthly Report(Maasanivedika)
Minutes Book
NORMS OF BOOK KEEPER:
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Book keeper maintains the different book of SHG in proper order.
Book keeper does not take the money of the SHG groups.
Book keeper has to take the attendance of the SHG groups.
Book keeper has the transparency with the SHG groups.
Role model as book keeper help the book keeper herself
As a book keeper she got monthly rupees 100 as the salary. She also got
free training to maintain the book. She had varied knowledge about the
performance of the SHG compare with others SHG’s.
Responsibility taken care in the absence of book keepersShe will assign the responsibility to another book keeper of any other SHG’s
to write the transaction and attendance on some papers. When she will
come then she recorded it into the SHG’s books in presence of all the
members of the SHG’s.
SITUATION IN THE FIELD:
In the sample villages, where CRP strategy is
being implemented, there are about 1 BKs for
5 SHGs.
 Only nominal training is imparted.
 Bookkeepers are frequently changed because
unremunerative honorarium
 Outsiders are writing books in many of the
SHGs
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SUGGESTIONS:
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Proper training to Bookkeepers and refresher trainings on
monthly/bimonthly basis need to be given,
The status of bookkeeping need to be constantly monitored by
VBKs/MBKs
The remuneration of the BKs shall be adequately ensured to
get more retention as BKs
Women SHG members are encouraged to act as Bookkeepers.
In the study area, each SHG is having 2-3 women literate
members.
MICRO CREDIT PLAN(MCP)
1. OBJECTIVE- It is an investment plan prepared by all group of
members in a participatory way on their existing skills.
2. WHY MCP?
3. STEPS INVOLVED IN MCP PROCESS
 Household Investment Plan
 Understanding the socio-economic status and needs by
members
 Appraisal of socio-economic status and wealth ranking by
members
 Appraisal of Needs by members
CONTINUED……
5. Consolidation of needs and setting priorities
6. Financing the investments
7. Evolving terms of Partnership
KEY ISSUES Some of the SHGs not following MCP
 Lack of proper understanding about MCP.
 The steps involved and calculations of income/expenditure are
clearly not understood.
 critical rating by bankers and MCP not match.
 Sustainability factors.
SOURCES OF FUNDS AND EXTERNAL BORROWINGS
IN BIBINAGAR MANDAL
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SHG’s own funds-The SHGs use their own funds for internal
lending among their members and generally charge interest at
the rate of 2 - 3 per cent per month on these lending. These
rates are still lower than that charged by moneylenders. SERP
is also providing grant to Mandal samakhya’s( MS’s) in the form
of seed capital.
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CIF(community investment funds) as seed capital
Commercial banks( Andhra bank)
Regional Rural Bank( Andhra Pradesh grameen vikas bank)
Informal sources( friends/relatives)
VO’s savings.
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WE CAN THUS SEE THE EVOLUTION OF SELF HELP GROUPS AT
THREE LEVELS IN THE STUDY AREA:
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At one level households use microfinance to meet ‘survival’ requirements
where small savings and loans serve as a buffer in the event of an
emergency or to smoothen consumption or even service previous debt to
give itself more liquidity during lean times.
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At the second level, ‘subsistence’ needs are met through microfinance,
where a household begins to utilize microfinance to diversify its basket of
income-generating activities, or to meet working capital requirements in
traditional activities.
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At the third level as households reach a stage where they can assume a
higher degree of risk, microfinance would be used to invest in setting up an
enterprise or facilitating entry into employment in one way or the other in
order that the household becomes ‘sustainable’.
LEARNINGS
SHGs, Vos and MSs acting like a microfinance
institutions to the poor.
 There is a need to strengthen these institutions
through1. Technological intervention
2. Increasing participation
3. Transparency
4. Initial support services.
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THANK YOU