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Socially Disadvantaged Groups and Micro-finance in India

Jean-Marie Baland (), Rohini Somanathan () and Lore Vandewalle ()

Working Papers from eSocialSciences

Abstract: About two-thirds of microfinance clients in India are reported to be in Self-Help Groups (SHGs). These mostly women’s groups have been promoted by nationalized banks since the early nineties to improve credit access among especially disadvantaged populations. The paper studies the survival of members and groups and their differential access to credit using a census of SHGs created between 1998 and 2006 in 386 villages in eastern India. Households without land and those from disadvantaged castes and tribes exhibit higher attrition rates and smaller loans but we find the main predictor of differential outcomes is education rather than social identity. Members with formal education receive larger loans and have a 30 per cent lower risk of being separated from their group. Groups with no such members are also four times more likely to become inactive.

Keywords: eSS; Socially Disadvantaged Groups; Micro-finance; Self-Help Groups (SHGs); nationalized banks; disadvantaged populations; Households without land; smaller loans; education; formal education; larger loans; risk; inactive groups; India. (search for similar items in EconPapers)
Date: 2017-11
Note: Institutional Papers
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Related works:
Journal Article: Socially Disadvantaged Groups and Microfinance in India (2019) Downloads
Working Paper: Socially Disadvantaged Groups and Microfinance in India (2017) Downloads
Working Paper: Socially Disadvantaged Groups and Microfinance in India (2015) Downloads
Working Paper: Socially Disadvantaged Groups and Microfinance in India (2011) Downloads
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