Role of microfinance incubators in India Investor Review

FinGad is a Place to Review Strategies With Fellow Investors
Not a member yet?

Drdutta's review
Investment Sector: Emerging Markets
Submitted by Drdutta

3 months ago
Add Tag

Vote

Role of microfinance incubators in India [ Login to Propose An Edit ]

From a microfinance institution’s point of view, India, it would seem, is a nation

divided. While nearly, 7.5 million poor people in the southern and eastern parts of the country have access to micro-credit, only around 350,000 people in the north and west have managed to do so. This state of affairs could lead to lopsided economic growth, unless something is done fast.

That is precisely what a clutch of institutions—called microfinance incubators—are now doing by coming up with an innovative solution to correct this imbalance.

These incubators have one purpose—to develop and deploy microfinance entrepreneurs and institutions into regions where the poor still remain untouched. Already, three such organisations—the Indian Institute of Management, Bangalore (IIMB), ICICI Bank and ABN Amro Foundation India—have incubated almost 35 microfinance institutions (MFIs). The result of this experiment suggests that the number could soon multiply.

Typically, microfinance incubation programmes involve a mix of classroom and on-field training. Emphasis is placed on teaching entrepreneurs how to develop systems that will help them manage a growing business and facilitate innovations in distribution, training, and managing the hundreds of foot soldiers these incubators will employ later on. If successful, this incubation effort has the potential to change the credit climate of India’s rural poor.

Did you find this article useful?

Add Review to:

1 comments ↓

#1 | Lovephileo @ 3 months ago WEB CONSULTANT / PASTOR at LIGHT OF THE WORLD CHRISTIAN CENTER User Rank : 413 Portfoilo Balance: $1,110,169.00 Comment Rating: 0 Flag Comment Spam | Miscategorized | Prohibited: Hi Drdutta,, Training in MFI's especially the field operators is very vital. in the philippines, incubation takes for 2 months averagely among MFI's. However, i've seen how it is kind a difficult to perfect the actual operation with a very good end result if the training we give defiles the values of Microfinancing. Innovations are tempting sometimes though it competes, but the core values must not be destroyed such as integrity, responsibility, unity, trust, mutual-sharing. Otherwise, even the world-class microfinance practitioners will fall short on excellence. MFI's must major not only the mechanics of the business but most of all the character and culture where microfinance was purposely borne for.

Please Login or Register to comment

Read about it? Trade it!

Sphere: Related Content

Sponsors Links