Beyond Micro-Credit: Putting Development Back into Micro-Finance
Microfinance is fast growing as a major development strategy and international industry. It seems to provide a practical and workable tool to address the deep-seated challenges of poverty. But can it really fulfil this promise? All too often the development goals of microfinance are lost, either behind technical and managerial solutions in pursuit of financial sustainability, or behind a narrow focus on the poorest.
This book analyses Indian microfinance in depth to explore how development can be put back into microfinance. It sets out how microfinance can be designed in practice to contribute to a wide range of developmental objectives, including providing social and economic security, promoting livelihoods, building peoples’ organisations, empowering women and changing wider systems within society.
The analysis covers the great diversity of microfinance practice in India and its many innovative products and organisational features. It looks in detail at the fast expanding movement of savings and credit or self-help groups in India and compares and contrasts these with groups promoted by the Grameen Bank in Bangladesh. It explores social entrepreneurship in the SHG movement in India and how to rise to the challenge of scale in Indian microfinance.
The book challenges much conventional wisdom in microfinance, especially the dominant framework of financial sustainability and outreach to the poor. It demonstrates how current analysis of efficiency in microfinance is simplistic, ignoring a range of real economic costs. It breaks new ground by drawing on the disciplines of organisational development and entrepreneurship to focus on the many organisational challenges and dilemmas that confront microfinance practitioners and how these can be managed in practice. Most importantly it puts development back at the heart of microfinance.
Without doubt this book provides the most comprehensive analysis available of microfinance practice in India and should be read widely by microfinance practitioners, NGOs and funding agencies. It will be of significant interest to those engaged in development studies, economics and sociology and should serve as a valuable supplementary text for courses in development, poverty studies and development economics.