Management Education in Microfinance

By K. Sukumaran, Indian School of Microfinance for Women, Ahmedabad

Flow of Presentation      Case for Microfinance Growth momentum in the Sector Capacity Building requirements Need for Management Education in the Sector The School·s Initiative .

Case for Microfinance    Incidence of Poverty : The World Bank report on global poverty reveals that India has 421 million people below the $1. Hence the incidence of poverty and hunger in India is alarming and to alleviate this situation. the ranks of the poor are still swelling. create assets and overcome poverty. Another literature. While there has been a decline in poverty ratio. microfinance institutions can play a right role by identifying the poor and lending small amounts of money so that the poor invests in income generating activities. earn income. the Global Hunger Index prepared by International Food Policy Research Institute (IFPRI) puts the number of hungry in India at 200 million ² the largest population of hungry in the world.25 a day mark in 1981. . the number had gone upto 456 million by 2005.

were discussed in group meetings and solutions arrived at. More than 27% of the world·s undernourished population live in India while 43% of the children in India under five years are underweight. malnourishment etc. and collectively the poor found solutions for their sufferings.  Social Capital and intervention in Community Issues: Microfinance in India is evolved mainly through SHG mechanism. sanitation. healthcare.Case .   . Through microfinance movement. education. development issues are discussed and entitlements are ensured. Development issues viz.

are those dimensions that transform women in registering economic and social change. ensuring accountability. making decisions etc.Case   Women Empowerment: A recent Impact Assessment Study anchored by SIDBI reveals that through women·s access to financial services. exhibiting leadership attributes. . empowerment dimensions have been observed. Control over finance and assets.

5 million bank credit groups. . In the words of the members of the federations. the federation has been described as their (a) Identity (b) Strength (c) Means to build capacities and skills (d) Space to express their views and (e) Methods to fulfill their dreams etc.366 crores which is a sound indicator of the community based microfinance model. Rs 230 billion cumulative loan amount and about 100 thousand SHG Federations. with 58 million members. the Indian SHG movement emerged as the largest MFI model in the world and the largest chain of the poor women·s own and only institutions. 3. 28. under SHG Bank Linkage Program of NABARD.Growth Momentum Community Based Model: As at end March 2007.95 lac SHGs are linked to branches of commercial banks with total loans outstanding at Rs 12. As per the Study conducted by APMAS.

.1million clients with an outstanding microfinance portfolio of Rs 5. The available data reveal that the resource flow to the microfinance sector has increased to around Rs 18.Growth  MFI Model: As at end March 2008. 223 MFIs had an outreach of 14.954 crores.000 crores (around USD 4 billion). Some of the institutions have grown into big size expanding its scale and areas of operations. top 10 MFIs in India alone account for Rs 7000 crores loan outstanding. Today.

and provide support to organizational building. Managing Microfinance Operations. Managing SHG Federations. Promotion of SHG Federations.   . Credit Management in SHGs. to put in place the right systems and procedures. The thematic interventions in Community Based Microfinance comprises of SHG Promotion & Management.Capacity Building Requirements  The objective of capacity building in microfinance is to facilitate the growth process of a microfinance organization through knowledge creation and skill building of the microfinance professionals. SHGs ² Best Practices etc The thematic interventions in MFIs are: Financial Management. OD and Governance. Products and Services etc. Book Keeping in SHGs. Micro Enterprise Development/Small Business Planning.

Outreach and Impact dimensions of the growth process are to be handled and managed through right type of talent available. The Scale. The need is to create a conducive environment where management education in microfinance is to be planned.Need for Management Education   The biggest challenge facing the Microfinance Sector is on HR front. designed and made available to those who aspire to be professionals in the sector. . This would fill the gap in demand and supply of microfinance professionals.

About the Course: Integrated: Teaches the hard and soft skills in microfinance Builds a holistic perspective Teaches how the economic and social aspects integrate to alleviate poverty .The School s Initiative   Indian School of Microfinance for Women. Ahmedabad has initiated in this front through launching its first certified program ² a three weeks residential program on ¶Microfinance for Development·. The first batch has just come out in February 2009.

household. women) Microfinance and relation to Development and Poverty: History. Plus Models Methods and Methodology: Individual lending. International and National experience Module 3 & 4 How of Microfinance Typology of Microfinance: Microcredit. Microfinance. SHGs. etc. Grameen.Ten Modules Locating Microfinance 1 & 2 Development and Poverty (General. ‡ ‡ ‡ ‡ . Federations.

Legal & regulatory constraints.Modules 5-6 From the supply side  4. vision. Mission. Introduction to financial ratios / Financial Management etc. Role of Wholesalers.  .Sustainability: Financial sustainability. Determination of Market and Clients. Operationalizing Microfinance. 5. Institutional constraints. Microfinance Bill etc. Banking institutions. Functioning within the market. Funders and Donors.

Roadblocks to effective microfinance. Mainstreaming a socio-economic approach. Building a gender lens. Formulation of a pro-women strategy: services. .Module 7: From the Demand Side  7. Delivering Microfinance Appropriately: Formulation of a pro-poor strategy:.

Module 8 Are you on Track?  8. Social Audits. Social Performance Management . Monitoring and Evaluation. Tracking Impact. Outcomes and Operations : Impact Assessment. MIS Systems.

Module 9: Better Microfinance     9. Role. Training. Behaviour Change Communication. . Capacity Building : Research. Methods and Need.

Livelihood finance . Beyond Microfinance.Module 10: Adding Value      10: Making a Difference: Value Additions in Microfinance: Financial Inclusion. Green Microfinance. ICT and Microfinance.

middle and end of course Trains the eye and perception of participants Urban and Rural field Presentations to be evaluated. 10 core faculty. In total. 50 articles on microfinance. 11 guest lectures etc.Three Field Visits      At beginning. . there were 48 sessions.

.Shaping the Course for Future  To garner dedicated professionals for the microfinance sector. BCC and mF. Livelihoods and mF etc. The core papers can be on i) Efficient Microfinance and ii) Effective Microfinance Optional Subjects can be from ICT and mF. it is suggested to design and implement a longer ² one year or six months course in Microfinance for Development. SPM and mF. FI and mF.

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