Author(s): Shivaprasad G and Gayathri R
Microfinance too as a financial tool has also seen ups and downs. During 2011, market commentators predicted the end of India’s microfinance market but as on 31 March 2014, there were more than 74.30 lakh savings-linked SHGs, covering over 9.7 crore poor households. The total savings of these SHGs with banks amounted to`9897.42 crore. The number of credit-linked SHGs under the programme was 41.97 lakh. In 2011, the government of the state of Andhra Pradesh was seeking to prohibit the microloans business. After the crisis, RBI has handled the sector very vigilantly, carefully and very thoughtfully. The National Bank continued to provide 100 per cent refinance assistance to banks for financing SHGs. The SHG–Bank Linkage Programme (SHG–BLP) has expanded substantially since it was first launched on a pilot scale in 1992. This paper offers a framework to better understand how and where microfinance can offer a social benefit. The paper highlights that microfinance contributes to a positive social impact on three different levels.