INTRODUCTION

The Story of Microfinance in India

‘Microfinancing’ was introduced in India in the 1980s as a solution to poverty and to
empower women. Despite its strong potential, the microfinance sector faces
challenges related to accessibility in rural India.
Microfinance is a type of banking service provided to those who have difficulty in
accessing formal financial services. It is targeted at the low-income and unemployed
fraction of the population. The institutions supporting microfinance offer services
such as lending, setting up bank accounts and providing micro-insurance products. In
developing countries such as India, financial services through normal channels do not
meet the demands of the rural poor, so microfinance can help small-scale businesses
flourish by providing greater financial stability.
The leading cause of the failure of formal banking institutions in India is while
lending loans to the poor people in rural area the absence of proof of recognized
employment or collateral that can be submitted by the poor people to the banks while
applying for loans. The high risk and transaction costs of small loan savings deposits
create difficulty for the banks as well. This leaves the poor with no alternative but to
borrow money from local moneylenders at high-interest rates.
In India, the first initiative to introduce microfinance was the Self-Employed
Women’s Association (SEWA) in Gujarat, which established SEWA Bank in
1974.Since then this bank has been providing financial services to individuals who
wish to grow their own businesses in rural areas. One successful initiative is
Kudumbashree the Kerala state’s Poverty Eradication Mission that was launched in
1998. This female-led community organization of Neighborhood Groups (NHGs)
brings women from rural and urban areas together to fight for their rights and helps
empower them. Through these NHGs, women work on a variety of issues like health,
nutrition and agriculture. They can collect income and seek microcredit while
working under this scheme. Such small-scale initiatives are promoting financial
independence in underprivileged areas.
There is a need to provide microfinance facilities to cater to India’s large rural
population. The main objectives of microfinance in India should be promoting socio-
economic development at the grassroots level through a community-based approach,
1
empowering women and increasing the household income. As with implementing any
transformative initiative, running a microfinance programme in rural India comes
with some challenges.
In India, the first initiative to introduce microfinance was the Self-Employed
Women’s Association (SEWA) in Gujarat, which established SEWA Bank in 1974.
Since then, this bank has been providing financial services to individuals who wish to
grow their own businesses in rural areas. One successful initiative is Kudumbhasree
the Kerala state’s Poverty Eradication Mission that was launched in 1998. This
female-led community organization of Neighbourhood.
Groups (NHGs) bring women from rural and urban areas together to fight for their
rights and helps empower them. Through these NHGs, women work on a variety of
issues like health, nutrition and agriculture. They can collect income and seek
microcredit while working under this scheme. Such small-scale initiatives are
promoting financial independence in underprivileged areas.
There is a need to provide microfinance facilities to cater to India’s large rural
population. The main objectives of microfinance in India should be promoting socio-
economic development at the grassroots level through a community-based approach,
empowering women and increasing the household income. As with implementing any
transformative initiative, running a microfinance programme in rural India comes
with some challenges.
Does Not Reach the Deserving Poor
The microfinance delivery models fail to focus on people who are below the poverty
level as they are deemed to be risky. There is a bias whilst selecting beneficiaries for
the scheme. To run the programme successfully and to attain higher repayment rates,
the operators of the scheme select economically stable individuals as the programme
beneficiaries. The core poor are too risk-averse to borrow for investing in the future.
They will, therefore, benefit only to a limited extent from the microfinance schemes.
Limited Spread in the Poorer States
The coverage of microfinance programme is low in those states where a large
percentage of the population lives in poverty. States such as Orissa, Bihar,
Chhattisgarh, Jharkhand, Madhya Pradesh and Uttar Pradesh lag behind in
implementing microfinance schemes. The successful distribution of microfinance

2
programmes depends on the support extended by the respective state governments, the
local culture and practice, and concentration of MFIs in these states.
High Interest Rates
Borrowers are interest-sensitive, so the capacity of borrowing decreases with an
increase in interest rates. Thus, high-interest rates are counterproductive and weaken
the economic status of poor clients. It is also exploitative to charge very high interest
rates from poor clients. The interest rates do not seem to be well-regulated in
microfinance sector. Some MFIs have regulated interest rates. However, they may
impose transaction costs which increase the burden that comes with borrowing and
makes it less attractive. Whereas the banking sector charges 9-10% annual interest
rate, MFIs may charge 11-24%. However, these rates of interest vary with the lending
conditions and policies of the MFI.
Low Depth of Outreach
The outreach of the programme is expanding but the number of loans taken remains
small. This amount isn’t sufficient to satisfy the financial needs of poor people. The
duration of the loans rarely extends over a year. The insufficient loan size and the
short period of lending available, restrict borrowers from using the loans for
productive purposes. They generally use these small loans to address liquidity issues,
rather than borrowing to invest.
Our concerns should lay on people’s accessibility to microfinance in rural and urban
areas, the regulations that come with it and the provision of basic training for the rural
and urban poor on how to use these loans for productive purposes.

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 OBJECTIVES OF THE STUDY

• The main objective of the study is to know about the micro finance importance.
• To know the role played by the microfinance sector in the development of Indian
economy.
• To examine the role played by SBI as a microfinance bank.
• To understand the customer opinion on loan repayment process.
• To analyze the repayment methods and periods offered to the customers.
• To suggest the ways and means for improving the operational efficiency in financing
the small business.
• To understand customer opinion on availing of microfinance.
• To know which kind of customers are showing interest to avail the microcredit.
• To understand the reasons for delay of repayments.

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 NEED FOR THE STUDY

• A study to examine the impact of microfinance banks on the economic growth.

• A study to examine the role played by the microfinance sector in the development of
Indian economy.
• To understand the progress of microfinance credit to MSEs.
• As a part of my curriculum, I need to do project.

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 SCOPE OF THE STUDY

• To study microfinance services offered by the SBI.

• To study the different types of schemes provided to the small business sector
• To know the eligibility criteria for microfinance credit.
• To ascertain the progress of SBI in microfinance lending policies.

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 RESEARCH AND METHODOLOGY

Research methodology is the specific procedures or techniques used to identify,

select, process, and analyze information about a topic. In a research paper, the
methodology section allows the reader to critically evaluate a study’s overall validity
and reliability.
Sources of data collection: The sources of data can be divided into two types:
• Primary Data
• Secondary Data
PRIMARY DATA:
Primary data are original in nature and directly related to the issue or problem and
current data. Primary data is a type of data that is collected by researchers directly
from main sources through interviews, surveys, experiments.
SECONDARY DATA:
Secondary data refers to ‘Second-hand information’. These are not originally
collected rather obtained from already published or unpublished sources
This research project is based on secondary sources of data. The used data has been
taken from authenticated sources such as books, RBI website and relevant
government websites.

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 LIMITATIONS OF THE STUDY

• The data was collected through the Primary sources only.

• The study is limited as the time is very less for the project submission.
• As the source of my study belongs to Primary data, it may not be 100% accurate.
• As the topic is very vast, I cannot make a detailed analysis on more commercial banks

8
 INDUSTRY PROFILE

The word “bank” is believed to have its origin from the word “banko” in Italian,
which means a bamboo bench. The early bankers in 17th century used to sit in the
market place on bamboo benches to deal with money. The Indian Banking Starts
from Bank of Hindustan Established in 1770 and it was first bank at Calcutta under
European management. It was liquidated in 1830-32. Here we are sharing some most
important points related to “History of Banking in India”. Evolution of banking in
India started From Bank of Hindustan in 1770, and this evolution can be divided into
three different periods as follows:
Phase I: Early phase of primitive Indian banks to Nationalization of Banks in 1969
Phase II: From Nationalization of India banks in 1969 up to advent of liberalization
and banking reforms in 1991
Phase III: From Indian Financial and Banking Sector Reforms 1991 onwards. In 1786
General Bank of India was set up. The largest bank, and the oldest still in existence, is
the State Bank of India, which originated in the Bank of Calcutta in June 1806, which
almost immediately became the Bank of Bengal. This was one of the three presidency
banks, the other two being the Bank of Bombay and the Bank of Madras, all three of
which were established under charters from the British East India Company. The
three banks merged in 1921 to form the Imperial Bank of India, which, upon India’s
independence, became the State Bank of India in 1955. For many years the presidency
banks acted as quasi-central banks, as did their successors, until the Reserve Bank of
India was established in 1935.
In 1969 the Indian government nationalized all the major banks that it did not already
own and these have remained under government ownership. They are run under a
structure known as ‘profit-making public sector undertaking’ (PSU) and are allowed
to compete and operate as commercial banks. The Indian banking sector is made up of
four types of banks, as well as the PSUs and the state banks; they have been joined
since the 1990s by new private commercial banks and a number of foreign banks.
Indian companies Act and Banking Regulation Act defined banking business only but
not the word “Bank”. While the former defines business of banking, the later i.e.,
Banking Regulation Act defined the banking by stating the essential functions of a

9
Banker. It also states the various other items of business that a banking company can
be engaged in, and also some other items of business i.e., Prohibited to perform.
Section 5(b) of BR Act defines the term banking as “accepting deposits of money
from the public”, for the purpose of lending or reinvestment, repayable on demand or
otherwise and withdraw able by checks, draft, and order or otherwise.
Acceptance of deposits of money, but not goods or non-money financial assets from
public and such deposits are repayable as well as with draw able in a certain specified
manner, and
The acceptances of such deposits are for purpose of lending or reinvestment but not
for any other trading\manufacturing activity.
BRIEF HISTORY OF BANKING IN INDIA:
From the ancient times in India, an indigenous banking system has prevailed. The
businessmen called Shroffs, Seths, Sahukars, Mahajans, and Chettis etc. had been
carrying on the business of banking since ancient times. These indigenous bankers
included very small money lenders to Shroffs with huge businesses, who carried on
the large and specialized business even greater than the business of banks.
The origin of western type commercial Banking in India dates back to the 18th
century.
The story of banking starts from Bank of Hindustan established in 1770 and it was
first bank at Calcutta under European management.
In 1786 General Bank of India was set up.
Since Calcutta was the most active trading port in India, mainly due to the trade of the
British Empire, it became a banking center.
Three Presidency banks were set up under charters from the British East India
Company- Bank of Calcutta, Bank of Bombay and the Bank of Madras. These worked
as quasi central banks in India for many years. The Bank of Calcutta established in
1806 immediately became Bank of Bengal.
In 1921 these 3 banks merged with each other and Imperial Bank of India got birth. It
is today’s State Bank of India.
The name was changed after India’s Independence in 1955. So, State bank of India is
the oldest Bank of India.

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In 1839, there was a fruitless effort by Indian merchants to establish a Bank called
Union Bank. It failed within a decade.
Next one is the Allahabad Bank which was established in 1865 and working even
today.
The oldest Public Sector Bank in India having branches all over India and serving the
customers for the last 145 years is Allahabad Bank. Allahabad bank is also known as
one of India’s Oldest Joint Stock Bank.
The Oldest Joint Stock bank of India was Bank of Upper India established in 1863
and failed in 1913.
The first Bank of India with Limited Liability to be managed by Indian Board was
Oudh Commercial Bank. It was established in 1881 at Faizabad. This bank failed in
1958.
The first bank purely managed by Indian was Punjab National Bank, established in
Lahore in 1895. The Punjab national Bank has not only survived till date but also is
one of the largest banks in India.
However, the first Indian commercial bank which was wholly owned and managed by
Indians was Central Bank of India which was established in 1911.
Central Bank of India was dreams come true of Sir Sorabji Pochkhanawala, founder
of the Bank.
Sir Pherozesha Mehta was the first Chairman of this Bank.
Many more Indian banks were established between 1906&1911. This was the era of
the Swadeshi Movement in India. Some of the banks are Bank of India, Corporation
Bank, Indian Bank, Bank of Baroda, Canara Bank and Central Bank of India.
Bank of India was the first Indian bank to open a branch outside India in London in
1946 and the first to open a branch in continental Europe at Paris in 1974.
The Bank was founded in September 1906 as a private entity and was nationalized in
July 1969. Since the logo of this Bank is a star, its head office in Mumbai is located in
Star House, Bandra East, and Mumbai.
There was a district in Today’s Karnataka state called South Canara under the British
Empire. It was bifurcated in 1859 from Canara district, thus making South Kannada
and Udupi district. It was the undivided South Kannada district. It was renamed as

11
 South Kannada in 1947. Four banks started operation during the period of Swadeshi
Movement and so this was known as “Cradle of Indian Banking.
This was the first phase of Indian banking which was a very slow in development.
This era saw many ups and downs in the banking scenario of the country.
The Second Phase starts from 1935 when Reserve bank of India was established.
The period between 1911&1948, there were more than 1000 banks in India, almost all
small banks. The Reserve Bank of India was constituted in 1934 as an apex Bank,
however without major government ownership. Government of India came up with
the Banking Companies Act 1949. This act was later changed to Banking Regulation
(Amendment) Act 1949.
The Banking Regulation (Amendment) Act of 1965 gave extensive powers to the
Reserve Bank of India. The Reserve Bank of India was made the Central Banking
Authority.
The banking sector reforms started immediately after the independence. These
reforms were basically aimed at improving the confidence level of the public as most
banks were not trusted by the majority of the people. Instead, the deposits with the
Postal department were considered safe.
The first major step was Nationalization of the Imperial Bank of India in 1955 via
State Bank of India Act.
State Bank of India was made to act as the principal agent of RBI and handle banking
transactions of the Union and State Governments.
In a major process of nationalization, 7 subsidiaries of the State Bank of India were
nationalized by the Indira Gandhi regime. In 1969, 14 major private commercial
banks were nationalized.
The 14 banks Nationalized in 1969 are as follows:
• Central Bank of India
• Bank of Maharashtra
• Dena Bank
• Punjab National Bank
• Syndicate Bank
• Canara Bank
• Indian Bank

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• Indian Overseas Bank
• Bank of Baroda
• Union Bank
• Allahabad Bank
• UCO Bank
• Bank of India.
The above was followed by a second phase of nationalization in 1980, when
Government of India acquired the ownership of 6 more banks, thus bringing the total
number of Nationalized Banks to 20. The private banks at that time were allowed to
function side by side with nationalized banks and the foreign banks were allowed to
work under strict regulation.
After the two major phases of nationalization in India, the 80% of the banking sector
came under the public sector / government ownership. The following sequence of
events:
Creation of Reserve bank of India: 1935
Nationalization of Reserve Bank of India: 1949 (January)
Enactment of Banking Regulation Act: 1949 (March)
Nationalization of State Bank of India: 1955
Nationalization of SBI Subsidiaries: 1959
Nationalization of 14 major Banks: 1969
Creation of Credit Guarantee Corporation: 1971
Creation of Regional Rural Banks: 1975
Nationalization of 7 more banks with deposits over Rs. 200 Crore 1980
The result was outstanding. The public deposits in these banks increased by 800%, as
the government ownership gave the public faith and trust.
The third phase of development of banking in India started in the early 1990s when
India started its economic liberalization.
The largest bank, and the oldest still in existence, is the State Bank of India (S.B.I). It
originated as the Bank of Calcutta in June 1806. In 1809, it was renamed as the Bank
of Bengal. This was one of the three banks funded by a presidency government; the
other two were the Bank of Bombay in 1840 and the Bank of Madras in 1843. The

13
three banks were merged in 1921 to form the Imperial Bank of India, which upon
India’s independence, became the State Bank of India in 1955.
For many years the presidency banks had acted as quasi-central banks, as did their
successors, until the Reserve Bank of India was established in 1935, under
the Reserve Bank of India Act, 1934. In 1960, the State Banks of India was given
control of eight state-associated banks under the State Bank of India (Subsidiary
Banks) Act, 1959.
These are now called its associate banks. In, 1969 the Indian government
nationalized 14 major private banks one of the big banks was Bank of India. In 1980,
6 more private banks were nationalized. These nationalized banks are the majority of
lenders in the Indian economy. They dominate the banking sector because of their
large size and widespread networks.
The Indian banking sector is broadly classified into scheduled banks and non-
scheduled banks. The scheduled banks are those included under the 2nd Schedule of
the Reserve Bank of India Act, 1934.
The scheduled banks are further classified into: nationalized banks; State Bank of
India and its associates; Regional Rural Banks (RRBs); foreign banks; and other
Indian private sector banks.
The term commercial banks refer to both scheduled and non-scheduled commercial
banks regulated under the Banking Regulation Act, 1949.Generally banking in India
is fairly mature in terms of supply, product range and reach-even though reach in rural
India and to the poor still remains a challenge.

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 COMPANY PROFILE

SBI LOGO:

Introduction
State Bank of India (SBI) is an Indian multinational public sector bank and financial
services statutory body headquartered in Mumbai, Maharashtra. SBI is the 43rd largest
bank in the world and ranked 221st in the Fortune Global 500 list of the world's
biggest corporations of 2020, being the only Indian bank on the list. It is a public
sector bank and the largest bank in India with a 23% market share by assets and a
25% share of the total loan and deposits market. It is also the fifth largest employer in
India with nearly 250,000 employees.
The bank descends from the Bank of Calcutta, founded in 1806 via the Imperial Bank
of India making it the oldest commercial bank in the Indian Sub-Continent. The Bank
of Madras merged into the other two presidency banks in British in India. The Bank
of Calcutta and the Bank of Bombay together formed the Imperial Bank of India,
which in turn became the State Bank of India in 1955. The Government of India took
control of the Imperial Bank of India in 1955, with Reserve Bank of India (India's
central bank) taking a 60% stake, renaming it State Bank of India.
History
The roots of State Bank of India lie in the first decade of the 19th century when
the Bank of Calcutta later renamed as the Bank of Bengal which was established on 2
June 1806. The Bank of Bengal was one of three Presidency banks, the other two
being the Bank of Bombay (incorporated on 15 April 1840) and the Bank of Madras
(incorporated on 1 July 1843). All three Presidency banks were incorporated as joint
15
stock companies and were the result of royal charters. These three banks received the
exclusive right to issue paper currency till 1861 when, with the Paper Currency Act,
the right was taken over by the Government of India. The Presidency banks
amalgamated on 27 January 1921, and the re-organized banking entity took as its
name Imperial Bank of India. The Imperial Bank of India remained a joint-stock
company but without Government participation.
Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve Bank
of India which is India's central bank acquired a controlling interest in the Imperial
Bank of India. On 1 July 1955, the Imperial Bank of India became the State Bank of
India. In 2008, the Government of India acquired the Reserve Bank of India's stake in
SBI so as to remove any conflict of interest because the RBI is the country's banking
regulatory authority.
In 1959, the government passed the State Bank of India (Subsidiary Banks) Act. This
made eight banks that had belonged to princely states into subsidiaries of SBI. This
was at the time of the First Five Year Plan, which prioritized the development of rural
India. The government integrated these banks into the State Bank of India system to
expand its rural outreach. In 1963 SBI merged State Bank of Jaipur (est. 1943) and
State Bank of Bikaner (est.1944).
SBI has acquired local banks in rescues. The first was the Bank of Bihar (est. 1911),
which SBI acquired in 1969, together with its 28 branches. The next year SBI
acquired National Bank of Lahore (est. 1942), which had 24 branches. Five years
later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been established in
1916 in Gwalior State under the patronage of Maharaja Madho Rao Scindia. The bank
had been the Dukan Pichadi, a small moneylender, owned by the Maharaja. The new
bank's first manager was Jall N. Broacha, a Parsi. In 1985, SBI acquired the Bank of
Cochin in Kerala which had 120 branches. SBI was the acquirer as its affiliate,
the State Bank of Travancore, already had an extensive network in Kerala.
There was, even before it actually happened, a proposal to merge all the associate
banks into SBI to create a single very large bank and streamline operations.
The first step towards unification occurred on 13 August 2008 when State Bank of
Saurashtra merged with SBI, reducing the number of associate state banks from seven
to six. On 19 June 2009, the SBI board approved the absorption of State Bank of

16
 Indore, in which SBI held 98.3%. (Individuals who held the shares prior to its
takeover by the government held the balance of 1.7 %.)
The acquisition of State Bank of Indore added 470 branches to SBI's existing network
of branches. Also, following the acquisition, SBI's total assets approached ₹10 trillion.
The total assets of SBI and the State Bank of Indore were ₹9,981,190 million as of
March 2009. The process of merging of State Bank of Indore was completed by April
2010, and the SBI Indore branches started functioning as SBI branches on 26 August
2010.On 7 October 2013, Arundhati Bhattacharya became the first woman to be
appointed Chairperson of the bank. Mrs. Bhattacharya received an extension of two
years of service to merge into SBI the five remaining associate banks.
Subsidiaries
SBI provides a range of banking products through its network of branches in India
and overseas, including products aimed at non-resident Indians (NRIs). SBI has 16
regional hubs and 57 zonal offices that are located at important cities throughout
India.
Domestic
SBI has over 24000 branches in India. In the financial year 2012–13, its revenue
was ₹2.005 trillion (US$27 billion), out of which domestic operations contributed to
95.35% of revenue. Similarly, domestic operations contributed to 88.37% of total
profits for the same financial year.
Under the Pradhan Mantri Jan Dhan Yojana of financial inclusion launched by
Government in August 2014, SBI held 11,300 camps and opened over 3 million
accounts by September, which included 2.1 million accounts in rural areas and 1.57
million accounts in urban areas
International
As of 2014–15, the bank had 191 overseas offices spread over 36 countries having the
largest presence in foreign markets among Indian banks
• SBI Australia
• SBI Bangladesh
• SBI Behrain
• SBI Botswana

17
 The company was registered in Botswana as a limited liability company, on 27
January 2006. On 29 July 2013, State Bank of India (Botswana) Limited, was granted
a banking license by the Bank of Botswana
• SBI Canada Bank
It was incorporated in 1982 as a subsidiary of the State Bank of India. SBI Canada
Bank is a Schedule II Canadian Bank listed under the Bank Act and is a member of
Canada Deposit Insurance Corporation.
• SBI China
• SBI (Mauritius) Ltd
SBI established an offshore bank in 1989, State Bank of India International
(Mauritius) Ltd. This then amalgamated with The Indian Ocean International Bank
(which had been doing retail banking in Mauritius since 1979) to form SBI
(Mauritius) Ltd. Today, SBI (Mauritius) Ltd has 14 branches – 13 retail branches and
1 global business branch at Ebene in Mauritius.
• Nepal SBI Bank Limited
In Nepal, SBI owns 55% of share. (The state-owned Employees Provident Fund of
Nepal owns 15% and the general public owns the remaining 30 %.) Nepal SBI Bank
Limited has branches throughout the country.
• SBI Sri Lanka
Now has three branches located in Colombo, Kandy and Jaffna. The Jaffna branch
was opened on 9 September 2013. SBI Sri Lanka is the oldest bank in Sri Lanka; it
was founded in 1864.
• SBI Nigeria
In Nigeria, SBI operates as INMB Bank. This bank began in 1981 as the Indo–
Nigerian Merchant Bank and received permission in 2002 to commence retail
banking. It now has five branches in Nigeria.
• SBI Moscow
In Moscow, SBI owns 60% of Commercial Bank of India, with Canara Bank owning
the rest. In Indonesia, it owns 76% of PT Bank Indo Monex. State Bank of India
already has a branch in Shanghai and plans to open one in Tianjin.

18
• SBI Kenya
In Kenya, State Bank of India owns 76% of Giro Commercial Bank, which it acquired
for US$8 million in October 2005
• SBI South Korea
In January 2016, SBI opened its first branch in Seoul, South Korea.
• SBI South Africa
• SBI UK Ltd
• SBI USA
In 1982, the bank established a subsidiary, State Bank of India, which now has ten
branches—nine branches in the state of California and one in Washington, D.C. The
10th branch was opened in Fremont, California on 28 March 2011. The other eight
branches in California are located in Los Angeles, Artesia, San Jose, Canoga Park,
Fresno, San Diego, Tustin and Bakersfield.
Former Associate Banks
SBI acquired the control of seven banks in 1960. They were the seven regional banks
of former Indian princely states. They were renamed, prefixing them with 'State Bank
of'. These seven banks were State Bank of Bikaner and Jaipur (SBBJ), State Bank of
Hyderabad (SBH), State Bank of Indore (SBN), State Bank of Mysore (SBM), State
Bank of Patiala (SBP), State Bank of Saurashtra (SBS) and State Bank of
Travancore (SBT). All these banks were given the same logo as the parent bank, SBI.
State Bank of India and all its associate banks used the same blue Keyhole logo said
to have been inspired by Ahmedabad’s Kankaria Lake. The State Bank of India word
mark usually had one standard typeface, but also utilized other typefaces. The word
mark now has the keyhole logo followed by "SBI".
The plans for making SBI a single very large bank by merging the associate banks
started in 2008, and in September the same year, SBS merged with SBI. The very next
year, State Bank of Indore (SBN) also merged.
Following a merger process, the merger of the 5 remaining associate banks, (viz. State
Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State
Bank of Patiala, State Bank of Travancore); and the Bharatiya Mahila Bank) with the
SBI was given an in-principle approval by the Union Cabinet on 15 June 2016.This

19
 came a month after the SBI board had, on 17 May 2016, cleared a proposal to merge
its five associate banks and Bharatiya Mahila Bank with itself.
On 15 February 2017, the Union Cabinet approved the merger of five associate banks
with SBI An analyst foresaw an initial negative impact as a result of different pension
liability provisions and accounting policies for bad loans. The merger went into effect
from 1 April 2017.
Non-Banking Subsidiaries
Apart from five of its associate banks (merged with SBI since 1 April 2017), SBI's
non-banking subsidiaries include:
• SBI Capital Markets Ltd
• SBI Cards & Payments Services Pvt. Ltd. (SBICPSL)
• SBI Life Insurance Company Limited
• SBI Mutual Fund
In March 2001, SBI (with 74% of the total capital), joined with BNP Paribas (with
26% of the remaining capital), to form a joint venture life insurance company named
SBI Life Insurance company Ltd.
Other SBI Service Points
As of 31 March 2017, the SBI group had 59,291 ATMs. Since November 2017, SBI
also offers an integrated digital banking platform named YONO
Yes Bank Investment
State Bank of India acquired 48.2% of the shares of Yes Bank as part of RBI directed
rescue deal in March 2020.
Listings and Shareholding
As on 31 March 2017, Government of India held around 61.23% equity shares in SBI.
The Life Insurance Corporation of India, itself state-owned, is the largest non-
promoter shareholder in the company with 8.82% shareholding.

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Shareholders Shareholding

Promoters: Government of India 56.92%

FIIs/GDRs/OCBs/NRIs 10.94%

Banks & Insurance Companies 10.63%

Mutual Funds & UTI 13.72%

Others 07.79%

Total 100.0%

The equity shares of SBI are listed on the Bombay Stock Exchange, where it is a
constituent of the BSE SENSEX index, and the National Stock Exchange of
India where it is a constituent of the CNX Nifty Its Global Depository Receipts
(GDRs) are listed on the London Stock Exchange
Employees
SBI is one of the largest employers in the world with 245,652 employees as on 31
March 2021. Out of the total workforce, the representation of women employees is
nearly 26%. The percentage of Officers, Associates and Subordinate staffs was
44.28%, 41.03% and 14.69% respectively on the same date. Each employee
contributed a net profit of ₹828,350 (US$11,000) during FY 2020–21.

21
 THEORTITCAL FRAMEWORK
Microfinance is the provision of financial services (loans, savings, and insurance) to
people on small scale, such as businesses with low or moderate incomes. Loans of
micro value are one of the better-known means of helping small business owners in
developing countries move out of poverty. Microfinance or Microcredit, banks the
unbankables, bringing credit, savings and other essential financial services within the
reach of millions of people who are too poor to be served by regular banks, due to
lack of sufficient collateral. In general, banks are for people with money, not for
people without. Micro credit belongs to the group of financial service innovations
under the term of microfinance, other services according to microfinance is micro
savings, money transfer vehicles and micro insurance. Micro credit is an innovation
for the developing countries. Micro credit is a service for poor people that are
unemployed, entrepreneurs or farms who are not bankable.
Subprime lending refers to loans extended to people with poor repaying ability that
ultimately led to defaults. The Rs 25,000-crore microfinance industry is facing more
times ever since the biggest is SKS Microfinance. In a world where almost half the
population lives on less than ₹186 a day, microfinance is one of the better tools for
poverty alleviation, economic growth and development in emerging economies.
Loans offer the same benefits to major world economies that face growth problems.
Having said that, one must realize microfinance is not impact of the global financial
crisis. Instead, we realize that loans can help lower-income group’s setup and grow
the small businesses, which generate income and employment that helps their
communities and their economies.
The importance of microfinance in the process of poverty eradication is realized, it
faces multiple problems. This is because offering credit to the poor is a complicated
process and the sector is still in its experimental stage. Micro credit is based on the
premise that the poor have skills which remain unutilized or underutilized. It is
definitely not the lack of skills which make poor people poor. Charity is not the
answer to poverty. Charity is not the answer to poverty. It only helps poverty to
continue. It creates dependency and takes away the individual’s initiative to break
through the wall of poverty. Unleashing of energy and creativity in each human being
is the answer to poverty. Poor people do not want to stay poor. Like everyone else,

22
they wish to put an end to their economic hardship and exploitation by either working
or exploring self-employment. In the latter case, money can be raised through friends
and family, gathered over time through savings, or obtained through loans from
microfinance institutions. High interest rates have caused a stir in the microfinance
community, where microfinance institutions justify the figures and the media
criticizes them. The recent microfinance crisis in India saw a twist in the story that led
everyone to wonder if these justifications were valid – the five largest microfinance
institutions in India simultaneously slashed their interest rates to 24%, amid harsh
criticism from the government and media. There is uncertainty regarding the validity
of justifications used to explain the differences in interest rates charged by
microfinance institutions and commercial banks. Microfinance institutions often cite
high transaction costs of processing a large number of small transactions, and high
transport costs of dealing with clients spread overlarge geographical areas. In,
addition to this, a small premium is added for profit-oriented microfinance
institutions, which is a debate in itself.
The Asian Development Bank (ADB) targeted financial services towards the poor are:
• Deposits
• Finance schemes or loans upto ₹2,24,70
• Payment services
• Money transfers
• Insurance to poor and low-income households and their micro-enterprises
Microfinance Institutions (MFIs) provide loans and savings services through a variety
of lending models, while micro entrepreneurs use these services. The theory is that if
the poor have access to these services, their financial lives will be more stable,
predictable and secure, allowing them to plan and improve their livelihoods through
education, health care and empowerment.
In other words, microfinance converts poverty into an economic opportunity that
evades the idea of exploitation.
Microfinance or Micro credit, is banking the unbankables, bringing credit, savings
another essential financial services within the reach of millions of people who are too
poor to be served by regular banks, due to lack of sufficient collateral. In general,
banks are for people with money, not for people without. Micro credit belongs to the

23
group of financial service innovations under the term of microfinance, other services
according to microfinance is micro savings, money transfer vehicles and micro
insurance. Micro credit is an innovation for the developing countries. Micro credit is a
service for poor people that are unemployed, entrepreneurs or framers who are not
bankable.
SOURCESOFMICROFINANCE
Microfinance providers come in various forms which can be broadly grouped as
follows:
FORMAL MICROFINANCE INSTITUTIONS
Rural/microfinance/village banks, commercial banks, telecom firms, and cooperatives
offering loans to lower-income group individuals.
SEMI-FORMAL MICROFINANCE INSTITUTIONS
Non-governmental organizations providing micro-sized loans.
INFORMAL MICROFINANCE SOURCES
Moneylenders and shopkeepers who often loan money on a daily basis and charge
exorbitant interest rates.

PROBLEMSFACEDBYMICROFINANCE
Despite good intentions, microfinance still has several hurdles to face.
Perceived high risk of lending to the poor (the loan may be misused
easily).Technology-related hurdles, such as the high costs involved in small loan
transactions from microfinance providers. Lack of awareness about sources of funds
for microfinance providers to pass on to the poor. The Poor’s inability to offer
marketable collateral for loans to economists. Difficulty in measuring the social
performance of MFIs.

24
High interest rates of loans made to the poor. Lack of customized
solutions/microfinance models for the poor.
In appropriate targeting of poor households by microfinance programs. Lack of
microfinance training for MFIs. Poor distribution system of MFIs, i.e., need to spread
out loan facilities into rural areas. Lack of information about microfinance investment
opportunities. Poor institutional viability of microfinance ventures.
DualmissionofMFIstobefinanciallysustainableaswellasdevelopmentoriented.These
problems can be grouped according to whether they’re caused by MFIs or caused by
micro entrepreneurs.
DIFFERENTMICRO-FINANCECHALLENGES
The importance of microfinance in the process of poverty eradication is realized, it
faces multiple problems. This is because offering credit to the poor is a complicated
process and these cores still in its experimental stage. Some challenges are listed
below.
Perceived High Risk of Micro Entrepreneurship and Small Businesses. High Costs
Involved in Small Transactions/Micro lending. Lack of debt and equity funds to pass
on to the poor. Difficulty in Measuring the Social Performance of MFIs. Mixing
Charity with Business. Lack of Customized Solutions for the Poor. Lack of
microfinance training for Human Resource in Microfinance Institutions. Poor
Distribution System of Microfinance Institutions and lack of information about
microfinance investment opportunities. Dual mission of Microfinance Institutions to
be Financially Sustainable as well as Development Oriented.
MICROFINANCE
A micro-finance institution (MFI) is either an informal lending institution or a bank
that offers loans to low-income borrowers. Micro-finance institutions try to help
eradicate poverty and create sustainable development in rural areas and slum
settlements in urban centers by providing small loans. In the developing world,
Kenya, a small country in Africa, is one of the countries with successful micro-
finance institutions. Equity Bank, which has 4millionbank-accountholders; half of all
the country's banked population, started as a small, rural micro-finance company.

25
SAVINGS
Micro-finance institutions offer safe custody to members' money. Many of the
members in developing countries are women's groups. They take loans by
guaranteeing each other and arable to start micro and small informal businesses. The
wide distribution of the MFIs makes it easier for these groups and individuals to
accumulate petty cash into large savings for future development projects.
CREDIT
Micro-finance institutions offer loans to small-income earners such as farmers, green
grocers, and car garage operators. The institutions first offer training to their
customers about investment opportunities before they give out the loans. The loans
help in expansion of the businesses. These credit facilities lead to improvement in
terms of education, health, empowerment and environmental conservation in the
community.
INSURANCE
MFIs offer insurance coverage to farmers for crops and livestock. This militates
against the vagaries of nature such as reduced rain which may cause crops to dry or
animals to die of hunger due to drought. Offering insurance coverage to small-income
earners helps reduce the impact of unforeseen externals hocks and also encourages
investment.
MONEY TRANSFER
Micro-finance institutions have aided in money transfer. Today, there are various
programs that ensure that people can send and receive money via the telephone.
Money transfer by MFIs also includes the payment of water bills, electricity bills or
even payment for purchased goods. In Kenya, the boldest step that the micro-financial
sector has taken towards improvement of remittance services is the introduction of M-
Kesho account by Equity bank. Now, small and micro-business owners will be able to
deposit their small daily earnings to the MFI through their mobile phones.

26
ROLE OF MICRO FINANCE
According to microfinance information group Kiva, microfinance is a way of
supplying financial services such as loans; savings accounts and insurance to people
who are too poor to usually have access to these kinds of services. Microfinance
institutions (MFIs) that supply micro finance products to communities are made up of
a variety of organizations from non-profit groups to large commercial banks.
AIMS
According to the Microfinance Gateway organized by the Consultative Group to
Assist the Poor, MFIs attempt to provide financial services and assistance to members
of society who would not usually have access to traditional financial institutions such
as banks. By providing an organized financial service, MFIs attempt to provide a safer
way for poor people to invest money than the traditional ways offered within a
community. Many poor people are described by Kiva as saving money in assets such
as domestic livestock, jewelry and building materials that can be quickly traded for
cash in times of need.
CREDIT
In terms of micro finance, the most common service offered that has been studied the
most is micro credit, according to Microfinance Gateway. The role of micro credit is
to offer people near the poverty line an opportunity to create business opportunities
for themselves that have been clearly identified and can be capitalized upon quickly.
Where credit lines are opened, people who would usually be left to struggle to survive
in times of hardship such as during an illness or a natural disaster have access to
money to survive on until times improve.
USES
Microfinance Gateway explains that the services offered by MFIs, including micro
credit, are not always appropriate to all members of society. Businesses that often
benefit from the use of microfinance include small retail stores, street vendors and
service providers. The role of microfinance, as described by Microfinance Gateway, is
the provision of financial services to benefit poor communities around the world in
such a way that long-term income levels in those communities are increased.

27
EQUALITY
Micro finance groups are described by Kiva as often being associated with aiming
their product sat women in poor communities. The idea behind this is to provide
households with economic stability and provide economic independence to women.
By providing a source of income to women, Kiva reports that a sense of
empowerment is passed onto those who benefit.
THE ROLE OF MICROFINANCE IN THE ECONOMIC
DEVELOPMENT
In a world where almost half the population lives on less than ₹186 a day,
microfinance is one of the better tools for poverty alleviation, economic growth and
development in emerging economies. Loans offer the same benefits to major world
economies that face growth problems.
Microfinance is not impervious to impact of the global financial crisis. Instead, we
realize that loans can help lower-income group’s setup and grow the small businesses,
which generate income and employment that helps their communities and their
economies.
Microfinance lenders provide small loans to current and aspiring small business
owners. These loans help give people who may not have the credit or the access to
traditional financing the opportunity to earn a higher income and provide jobs to their
local communities. The amount of microfinance loans varies by lender and can range
from ₹1866 upto ₹1, 49,306.
FINANCIAL STABILITY
One of the largest roles that microfinance has in local economies is helping to provide
low-income and poor families with the means to becoming financially stable. Small
microfinance loans give people the opportunity to generate enough income to pay for
necessities such as food, shelter and basic medical needs. Giving these families the
opportunity for long-term financial stability can help reduce the number of people on
public assistance programs, which benefits local and national economies.
JOB CREATION
A business that opens and operates as a result of a microfinance loan does not create
jobs in as large numbers as bigger multi-national corporations. Many microfinance
lenders focus on giving loans to people who live in some of the poorest areas of the
28
world. The jobs these small businesses create are significant to these local
communities where jobs are scarce. When people in these small communities are
earning more income, the more likely it is that they will spend their earnings within
their community. This helps stimulate local economic growth.
GLOBALPOVERTY
Microfinance supporters believe that giving low income and poor families the
opportunity for long-term financially stability through these small loans helps break
the cycle of poverty in the current generation and work toward ending global poverty
for future generations. As more of these communities begin to grow and the local
economies begin to prosper, the world's gross domestic product begins to increase and
the income gap between the wealthiest and poorest people in the world will begin to
decrease.
THE ENTERPRISING SPIRIT OF THE POORIS VALUABLE FOR
THE ECONOMY
Poor people do not want to stay poor. Like everyone else, they wish to put an end to
their economic hardship and exploitation by either working or exploring self-
employment. In the later case, money can be raised through friends and family,
gathered over time through savings, or obtained through loans from microfinance
institutions.
Naturally, small business owners are not afraid of failure and their ‘resilience
determination’ has helped them march through the current economic recession,
marked by a collapse of debt instruments. Bear in mind that all these are common
characteristics of entrepreneurs.
HIGH INTEREST RATES PROBLEM IN MICROFINANCE
There is uncertainty regarding the validity of justifications used to explain the
differences in interest rates charged by microfinance institutions and commercial
banks. Microfinance institutions often cite high transaction costs of processing a large
number of small transactions, and high transport costs of dealing with clients spread
over large geographical areas. In addition to this, a small premium is added for profit-
oriented microfinance institutions, which is a debate in itself.
Questions arose when, SKS, the largest microfinance institution in India, slashed its
interest rates by around 2% amid severe criticism over a rise in suicides in the
29
province of Andhra Pradesh (where the MFI operates).
REDUCING INTEREST RATES IN MICROFINANCE LOWER COST
OF FUNDS
High interest rates have cause das tiring the microfinance community, where
microfinance institutions justify the figures and the media criticizes them. The recent
microfinance crisis in India saw a twist in the story that led everyone to wonder if
these justifications were valid – the five largest microfinance institutions in India
simultaneously slashed their interest rates to 24%, amid harsh criticism from the
government and media.
One of the reasons attributed to interest rates in microfinance is the high cost of funds
among other sources, microfinance providers may obtain loans from commercial
banks, who lend to MFIs at market rates. After this, microfinance institutions need to
add a premium to cover their own costs and risks, which means the interest rates paid
by micro-entrepreneurs, can go pretty high.
Naturally, if interest rates are to be reduced, microfinance institutions must have two
options:
REDUCE THE PREMIUM (ALSO REFERRED TO AS THE
‘SPREAD’)
This is dependent on transport costs, administrative costs, profit, salary expense, risk,

etc., which means it can only be reduced if operations become more efficient.

REDUCE THE COST OF FUNDS

This can be reduced by obtaining subsidized loans (through development agencies),
non-interest loans (e.g., through Kiva), and public deposits.
ROLE OF SBI IN MICROFINANCE
State Bank of India has decided to enter the microfinance market that has largely
remained unaffected by the economic slowdown.
SBI, which is a state-owned lender, is setting up a new vertical called Financial
Inclusion and Micro Market (FIMM). This vertical will handle the bank's
microfinance operations. The bank has appointed KV Haridas as the deputy managing
director of the FIMM vertical. The bank is at the moment laying the groundwork for
the national roll-out of FIMM, according to The Economic Times.
30
The entry of the SBI, India's largest lender, is expected to stir up the microfinance
sector. The bank is planning to offer microloans through its thousands of branches at
lower than prevailing rates in the market right now.
"We have a big presence in retail and the corporate segment. Micro lending is one
segment where we find great opportunities going forward," KV Haridas told the daily.
Aadhar would be the method of customer identification. An experiment run is
underway at Patiala, Punjab.
The banks would provide loans for individuals without the need to form joint liability
groups.
Bandhan Bank controls a quarter of the microfinance sector. Bandhan Bank gives
loans at a rate of 17.95% while other private banks like HDFC lend at 20% or more.

31
 DATA ANALYSIS AND INTERPRETATION

1. Have you been working before getting the loan?

a) Yes
b) No
Particulars Respondents Response%
Yes 30 60%
No 20 40%

Yes
No

INTERPRETATION:
This chart shown that out of 50 respondents 60% of respondents are working before
getting the loan and 40% are not working before getting the loan.

32
2. What was your job?
a) Carpenter
b) Driver
c) Crafter
d) Dress Maker
Particulars Respondents Response%
Carpenter 10 20
Driver 7 14
Crafter 8 16
Dress Maker 25 50

Carpenter
Driver
Crafter
Dress Maker

INTERPRETATION:
These charts shown that out of 50 respondents 20% of respondents are carpenters,
14% are drivers, 16% are crafters 50% are dress makers.

33
3. Is this your first time to take a loan?
a) Yes
b) No

Particulars Respondents Response%

Yes 40 90%
No 10 10%

Yes
No

INTERPRETATION:
This chart shown that out of 50 respondents it is first time for 90% of respondents to
take a loan and it is not the first time for remaining 10%

34
4. How many times you took a loan before this one?
a) 1 b) 2 c) 3 d) 4 e) 5 f) 6 g) More Than 6

Particulars Respondents Response%

1 5 10%
2 8 16%
3 15 30%
4 10 20%
5 4 8%
6 3 6%
More Than 6 5 10%

1
2
3
4
5
6
7

INTERPREATATION:
This chart shown that out of 50 respondents 10% took a loan before this one 2nd time
for the 16% 3rd time for 30% 4th time for 20% 5th time for 8% 6th time for 6% more
than 6th time for 10%.

35
 5. What is the value of loan taken?
a) Below 10,000 b)10,000 to 50,000
c) 50,000 to 1, 00,000 d) Above 1, 00,000

Particulars Respondents Response%

Below 10,000 30 60%
10,000 to 50,000 10 20%
50,000 to 1,00,000 6 12%
Above 1,00,000 4 8%

Below 10,00
10,000 to 50,000
1,00,000
Above 1,00,000

INTERPRETATION:
This chart shown that out of 50 respondents
• 60% taken a loan amount of less than 10,000.
• 20% taken a loan amount between 10, 000 to 50, 000.
• 12% taken a loan amount between 50,000 to 1, 00, 00.
• 8% taken a loan amount above 1, 00,000.

36
6. Why did you take this loan?
a) Repaying Debt
b) Starting a new business

Particulars Respondents Response%

Repaying Debts 35 70%
Starting A New Business 15 30%

Repaying Debts
Starting A New Business

INTERPRETATION:
This chart shows out of 50 respondents 70% is taking the loan for repaying debts and
30% for starting a new business.

37
7. For how long are you taking loans from this institution?
a) Less Than 1 Year
b) 1 Year
c) 2 Years
d) 3 Years

Particulars Respondents Response%

Less Than 1 Year 20 40%
1 Year 10 20%
2 Years 15 30%
3 Years 5 10%

Less Than 1 Year

1 Year
2 Years
3 Years

INTERPRETATION:
These chart shows that out of 50 respondents 40% of respondents are taking the loans
from less than 1 year, 20% from 1 year, 30% from 2 years 10% from 3 years from this
institution.

38
8. When you should repay this loan?
a) 6th Month
b) 12th Month
c) 24th Month
d) After 24 Months

Particulars Respondents Response%

6th Month 4 8%
12th Month 8 16%
24th Month 24 48%
More Than 24 Months 14 28%

6th Month
12th Month
24th Month
After Than 24th Month

INTERPRETATION:
These chart shows that out of 50 respondents 8% of respondents should repay this
loan in 6th month 16% in 12thmonth, 48% in 24th Month 28% After 24th Month.

39
9. When is the instalment due?
a) 2nd Month
b) 4th Month
c) 5th Month
d) 6th Month

Particulars Respondents Response%

2nd Month 2 4%
4th Month 15 30%
5th Month 9 18%
6th Month 26 52%

2nd Month
4th Month
5th Month
6th Month

INTERPRETATION:
These chart shows that out of 50 respondents 4% of respondent’s installment due is in
2ndmonth 30% in 4th month, 18% in 5thMonth, 52% in 6th Month.

40
10. Have you been late in repaying the loan?
a) Yes
b) No

Particulars Respondents Response%

Yes 36 72%

No 14 28%

Yes
No

INTERPRETATION:
This chart shown that out of 50 respondents 72% of respondents are late in repaying
the loan and remaining 28% are not.

41
11.What are the reasons for not repaying the instalments?
a) Financial needs of the family
b) Natural Disaster
c) Business Loss
d) Other Reason

Particulars Respondents Response%

Financial needs of the family 12 24%
Natural Disaster 12 24%
Business Loss 15 30%
Others 11 22%

Financial needs of the

family
Natural Disaster

Business Loss

Others

INTERPRETATION:
These chart shows that out of 50 respondents 24% of respondents are not repaying the
installment due to financial needs of the family 24% due to natural disaster, 30%due to
loss in the business 22% due to the other reasons.

42
12.Have you faced any problems in repaying the instalments during the
last year?
a) Yes
b) No
Particulars Respondents Response%
Yes 38 76%
No 12 24%

Yes
No

INTERPRETATION:
This chart shows that out of 50 respondents 76% faced problems and 24% did not
face any problem in repaying the installments.

43
13.What are the reasons for such problems?
a) Business Loss
b) Financial needs of the family
c) Market instability
d) Natural disaster

Particulars Respondents Response%

Business Loss 13 26%

Financial needs of the 16 32%

family
Market Instability 5 10%

Natural Disaster 16 32%

Business Loss

Finnacial needs of the

family
Market Instability

Natural Disaster

INTERPRETATION:
These chart shows that out of 50 respondents 26% of respondents said the reason as
business loss for not repaying the installments, 32% for financial needs of the family,
10% for market instability, 32% for natural disaster.

44
14. Are you satisfied with the loan repayment procedure?
a) Yes
b) No

Particulars Respondents Response%

Yes 34 68%
No 16 32%

Yes
No

INTERPRETATION:

This chart shows that out of 50 respondents 68% satisfied with loan repayment
procedure and 32% did not satisfy with the loan repayment procedure.

45
15.Are you satisfied with the loan conditions?
a) Yes
b) No

Particulars Respondents Response%

Yes 34 68%
No 16 32%

Yes
No

INTERPRETATION:

This chart shows that out of 50 respondents 68% satisfied with loan conditions and
32% did not satisfy with loan conditions.

46
 FINDINGS

• The major finding of this study is public satisfied on receiving the microfinance from
the SBI.
• SBI introduced new schemes in providing microfinance with low interest rates.
• The banks also taken care of different aspects while lending loans to the SME.
• After making analysis on the progress of SBI was progressed rapidly in microfinance
during these years.

47
 SUGESSTIONS

• Loan lending conditions must be improvised to attract customers who choose

microfinance.
• More publicity brings more customers.
• Loan repaying duration must be increased for the customers in case of unforeseen
contingences.
• Microfinance must be provided to the customers according to their repaying capacity
only.

48
 CONCLUSION
• Most of the people did not face any problem in repaying the loans
• The microfinance banks and institutions provide loans only according to the repaying
capacity of the customers.
• The MFI’S provide loans to the people belonging to the weaker section of the society
based on their skills and work.
• Out of 50 respondents 20% of respondents are carpenters, 14% are drivers, 16% are
crafters 50% are dress makers.
• 68% respondents are satisfied with loan conditions and 32% did not satisfy with loan
conditions in a total of 50 respondents.
• 76% faced problems and 24% did not face any problem in repaying the installments in
a total of 50 respondents.

49
 BIBLOGRAPHY

Websites:
www.google.com
www.bridgeindiaorg.uk
www.wikwpedia.com
www.researchgate.net
https://core.ac.uk

50
 QUESTIONNARE

1. Have you been working before getting the loan?

a) Yes
b) No
2. What was your job?
a) Carpenter
b) Driver
c) Crafter
d) Dress Maker
3. Is this your first time to take a loan?
a) Yes
b) No
4. How many times you took a loan before this one?
a) 1 b) 2 c) 3 d) 4 e) 5 f) 6 g) More Than 6
5. What is the value of loan taken?
a) Below 10,000 b) 10, 000 to 50,000
c) 50,000 to 1, 00,000 d) Above 1, 00,000
6. Why did you take this loan?
a) Repaying Debt
b) Starting a new business
7. For how long are you taking loans from this institution?
a) Less Than 1 Year
b) 1 Year
c) 2 Years
d) 3 Years

51
8. When you should repay this loan?
a) 6th Month
b) 12th Month
c) 24th Month
d) After 24 Months
9. When is the instalment due?
a) 2nd Month
b) 4th Month
c) 5th Month
d) 6th Month
10. Have you been late in repaying the loan?
a) Yes
b) No
11. What are the reasons for not repaying the instalments?
a) Financial needs of the family
b) Natural Disaster
c) Business Loss
d) Other Reason
12.Have you faced any problems in repaying the instalments during the last
year?
a) Yes
b) No
13.What are the reasons for such problems?
a) Business Loss
b) Financial needs of the family
c) Market instability
d) Natural disaster
52
14. Are you satisfied with the loan repayment procedure?
a) Yes
b) No
15.Are you satisfied with the loan conditions?
a) Yes
b) No

53