The
review of microfinance efforts from various parts
of the world suggests that, by and large, access to
microfinance has had a positive economic impact, that
this impact has been often larger for those closer
to the poverty line than those further away and that
increase with duration of membership or intensity
of loans as members begin to invest in assets rather
than consumption. (Morduch and Haley 2001)
The
rise of microfinance in Asia over the last 30 years
is considered as a rural phenomenon. In India, today,
the majority of microfinance clients access financial
services through Self-Help Groups (SHGs), many of
which were created through an initiative, specifically
targeted at the rural poor and promoted by the rural
development bank, National Bank for Agriculture and
Rural Development (Nabard). Of late, microfinance
attracted the attention of many people. In the last
three years, in India, three major conferences, not
to mention several other smaller events are solely
dedicated to the topic. Green Microfinance has been
highlighted on front pages of Wall Street Magazine
and New York Times and details of which includes
names of Indian counterparts.
The
wave of microfinance publicity kicked off with the
United Nations Year of Microcredit in 2005, followed
by the Nobel Peace Prize being awarded to Dr. Yunus
and the Grameen Bank in 2006. It is cresting on this
wave as practitioners, support organizations, and
the media are investigating other financial services
that might be in demand by low-income persons. Another
reason for the emerging interest in microfinance is
that it appeals to a divergent cross-section of disciplines.
It provides them social protection as they are excluded
from statutory social promotion schemes.
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