The microfinance sector in Southern India has evolved to be more competitive. The Southern Indian state of Tamil Nadu, which has spawned several Self-Help Groups (SHGs), is a home to a wide range of Non-Governmental Organisations (NGOs) and Microfinance Institutions (MFIs). As more players, both NGOs and Non-Banking Financial Companies (NBFCs), foray into Tamil Nadu’s vibrant microfinance sector, marketing strategies assume significance. Despite the influx of Grameen replicators and the drastic changes in the policy environment brought about by the recent microfinance crisis in Andhra Pradesh, Hand in Hand, an NGO providing microfinance, has succeeded in enhancing the loyalty of its SHG members. A qualitative study has been carried out on Hand in Hand’s marketing strategies, wherein a senior executive and five microfinance clients participated. The socioeconomic impact brought about by Hand in Hand has also been discussed in detail.

Hand in Hand, which is the parent organization of Hand in Hand Microfinance Pvt. Ltd. focuses on five pillars to bring about a socioeconomic change at the Bottom of the Pyramid (BoP), namely, Self-Help Groups (SHGs), the environment, child labor elimination and education, healthcare and citizens’ center enterprises (which are used to spread awareness of informational technology and civic issues). Microfinance is one of the core focus areas of Hand in Hand and all of its microloan borrowers are organized into SHGs.

The Hand in Hand microfinance model entails the formation of SHGs and monthly loan repayments as opposed to the weekly repayments mandated by Grameen replicators. The Self-Help Group (SHG) members gain an exposure to a wider gamut of social issues besides financial inclusion. Health camps and waste management have been implemented at the grassroots level by Hand in Hand. The NGO also has the backing of the state government of Tamil Nadu under the purview of the Mahilir Thittam scheme, wherein subsidies are provided for the disbursal of loans at a lower interest rate.

Marketing Management Journal, Marketing, Strategies, Microfinance, Sector, Case Study, Hand in Hand, Microfinance, Indian Chambers, National Manufacturing Competitiveness Council, Pricewaterhouse Coopers.