May 2007

Role of technology to expand Microfinance

Views: 134

Introduction

To open the discussion on urban microfinance it will be apt to quote Aloysius P. Fernandez, Executive Director, MYRADA: “It is not enough to teach people to fish when in most cases they cannot reach the river.” According to a 1998 publication by Paul B McGuire, John D Conroy and Ganesh B Thapa, 25 million poor households in India required INR 150 billion over nine years until 2005. In a study conducted by Mahajan and Nagasri the demand for credit was found to be INR 9,000 per annum per household among the  poor. In the Paradigm Group survey, average credit availed by each household was about INR 10,071 per annum in India. By one study, the source of more than 93.5 percent of credit is from the informal sector, where interest rates are often very high. The formal banking sector provides only 0.8 percent of the total credit. People in  areas do smoothen their consumption expenditure in face of uncertain streams by their savings in reserve. But apart from savings, people in  areas need access to convenient, liquid, safe deposit services which are protected against inflation. There is great need for retail financial services

Comments

comments

Click to comment

Leave a Reply

Your email address will not be published.

Latest News

To Top