Download sector_report1.pdf - Microfinance and Development ...

More documents

Recommendations

Info

While South Asia leads other regions in the scale of credit delivery, savings services are a relatively undeveloped because of the regulatory environment offer insurance to their members, mostly as agents of insurance companies in the partneragent model (Chapter 5A). Side-by-Side: A Slice of Microfinance Operations Sa-Dhan's efforts to establish and disseminate performance standards and promote transparency by publishing financial information on MFIs in the three core areas of sustainability, asset quality and efficiency bore further fruit with the publication of the 3rd Side by Side report in September 2005 (Sa-Dhan 2005). Coverage expanded from 42 MFIs in the 2nd (2004) report to 74 MFIs submitting financial information on the basis of audited balance sheets for the year end March 2005. Progress is reflected in Table 3.1 Table 3.1 Financial performance of sample MFIs in FY 2004 and FY 2005 Sustainability Asset Quality Efficiency Number of MFIs in sample Year OSS PAR CRR OCR TCR Client per credit officer 42 2004 72.8 4.5 90.4 20.0 34.9 164 74 2005 110.3 2.2 97.7 15.4 24.9 405 Sa-Dhan recommended standards 100% 90%
Progress Under the MFI Model is funded by borrowings is uniformly high for large, medium and small MFIs (82, 86 and 78 percent respectively). Large MFIs are more efficient users of funds, with 81 percent of total assets held as loans, as against 75 percent in the case of medium and small MFIs. Table 3.2 Region-wise growth in outreach in 2003-04 and 2004-05 MFIs by regional distribution No. of MFIs Outreach - FY 2005 Annual Growth (%) in outreach FY 2005 Annual Growth (%) in outreach FY 2004 East 18 332,476 61.12 32.68 West 2 6,738 31.40 42.15 North 3 91,317 11.34 19.50 South 45 1,710,323 67.50 51.73 Total 68 2,140,854 62.86 45.94 Source: Table 3 of Side-by-Side (Sa-Dhan 2005). Table 3.2 which is based on outreach data from 68 MFIs for which three year data was available from 2002-03 to 2004-05 (Table 3 of SBS) shows that the sample of 68 MFIs is growing fast, at 63 percent overall in terms of outreach in 2004-05, up from 46 percent in 2003-04. Growth is concentrated in 2 regions, the South and East, which already accounted for about 95 percent of membership as Table 3.2 shows. The growth rate was 31 percent in the West, on an extremely small base, and only 11 percent in the North, on a higher base. 9 However like the SBLP, the MFI model is trying to rectify regional skew, and the latest data will probably show a higher rate of growth in the West and central India, coming partly from expansion of existing MFIs from the South. Second, there is a broad inverse relationship between growth and size, with young MFIs growing faster than mature MFIs. According to the MIX report discussed below (MIX 2006), young institutions grew the fastest, by 160 percent over the same two years, followed by new institutions at 60 percent, and mature institutions by 53 percent. 10 SBS contains some interesting information on the dynamics of financial performance as MFIs age and grow. It takes 5 to 10 years for an MFI to attain operational sustainability. 11 As for the relationship of financial performance with size, Tables 3.3 provides a break up of performance by size in terms of outreach, and GLP, separately. It will be seen that only when MFIs become large with an outreach of 50,000 and GLP of Rs 20 crores do they become sustainable and manage to bring delinquency under control. However, using the same size classification in terms of GLP, but a smaller sample, the MIX report discussed below (MIX 2006) finds that even medium MFIs are sustainable, and have positive returns on assets and on equity (Figure 5, page 51, of the MIX report). Growth is concentrated in 2 regions, the south and east, which already accounted for about 95 percent of membership Interestingly, it appears from Table 3.3 that small MFIs are more efficient, with lower unit cost ratios than medium sized MFIs, perhaps because they have higher productivity in terms of number of active borrowers per credit office (small MFIs in terms of GLP have 88 percent more 51
Page 3: Microfinance in India A State of th
Page 6 and 7: List of Tables Page No Table 2.1 Gr
Page 8 and 9: Preface and Acknowledgements This r
Page 10 and 11: Abbreviations ABC ADB BC BF CAR CAG
Page 13 and 14: CHAPTER 1 Overview and Summary of M
Page 15 and 16: Overview and Summary of Main Recomm
Page 27: Overview and Summary of Main Recomm
Page 30 and 31: 1 1a 1b 2 2a 2b 2c 3 3a 3b 3c 4 4a
Page 32 and 33: The Light and Shades Study A major
Page 34 and 35: highest proportion of weak records
Page 36 and 37: their profitability after accountin
Page 38 and 39: allow the programme to grow organic
Page 40 and 41: 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8
Page 42 and 43: Endnotes 1 It is very hard to compa
Page 44 and 45: as cash with the groups, the true r
Page 46 and 47: linkages", 11 percent 3rd, and 5 pe
Page 48 and 49: References APMAS (AP Mahila Abhivru
Page 51: CHAPTER 3 Progress Under the MFI Mo
Page 55 and 56: Table 3.4 Comparative performance i
Page 57 and 58: Progress Under the MFI Model on lit
Page 59 and 60: Progress Under the MFI Model 4 Howe
Page 61: Progress Under the MFI Model Refere
Page 64 and 65: MFIs, and the need for MFIs to plou
Page 66 and 67: size had actually come down during
Page 68 and 69: The point at which peer group press
Page 70 and 71: The lack of contact and communicati
Page 72 and 73: Box 4.1 Continued 4. MFIs will coll
Page 74 and 75: Endnotes 1 There will be many disag
Page 76 and 77: 19 The base suicide rate in AP is 1
Page 78 and 79: References APMAS, 2005, "A Report o
Page 80 and 81: (such as cattle and houses), and co
Page 82 and 83: The advantage of the provider model
Page 84 and 85: Some lessons learnt from experience
Page 86 and 87: Box 5.2 VimoSEWA: Synergies between
Page 88 and 89: 86 Table 5.1 Main Feature of Health
Page 90 and 91: Endnotes 1 While the microinsurance
Page 92 and 93: 16 A little less than a fifth of th
Page 94 and 95: 29 The rationale for transfer progr
Page 96 and 97: Roth, James and Vijay Athreye, 2005
Page 98 and 99: Issues and priorities for action re
Page 100 and 101: Endnotes 1 See for instance CGAP (2
Page 102 and 103:
100
Page 104 and 105:
such as Chaitanya who soon became s
Page 106 and 107:
money to support operational expens
Page 108 and 109:
finance, and the microfinancial ski
Page 110 and 111:
Box 6.1 Continued in experts and to
Page 112 and 113:
Endnotes 1 In a sense it always was
Page 114 and 115:
16 Examples are Margdarshak in Luck
Page 116 and 117:
114
Page 118 and 119:
Table 7:1 Commercial bank exposure
Page 120 and 121:
The main constraints to the expansi
Page 122 and 123:
further review, RBI has modified th
Page 124 and 125:
9 Thus ICICI has sold some of its b
Page 126 and 127:
B. Equity Investments by the Ventur
Page 128 and 129:
Figure : The Bellwether triangle Lo
Page 130 and 131:
Despite the weaknesses the public s
Page 132 and 133:
Box 7.1 Continued foreign sources o
Page 134 and 135:
Endnotes 1 At this point they will
Page 136 and 137:
References ACCION, 2003, "The Servi
Page 138 and 139:
SIDBI Foundation for Micro Credit (
Page 140 and 141:
categories, depending on the amount
Page 142 and 143:
The distribution of total disbursem
Page 144 and 145:
Endnotes 1 It should be noted that
Page 146 and 147:
B. Donor Participation in Indian Mi
Page 148 and 149:
this has dropped to 8% on the curre
Page 150 and 151:
and poor populations. More directly
Page 152 and 153:
and expansion of available retailer
Page 154 and 155:
11 SDC through various programs for
Page 156 and 157:
154
Page 158 and 159:
1.1 Impact evaluation of Spandana's
Page 160 and 161:
in the loan tenure of 24 months. Th
Page 162 and 163:
There are two main motivations of a
Page 164 and 165:
compensation structures used by Ind
Page 166 and 167:
Endnotes 1 By Annie Duflo, Anvesha
Page 168 and 169:
29 The main components of direct tr
Page 170:
168
show all

Download sector_report1.pdf - Microfinance and Development ...

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?