Abstract :
Microfinance, or micro-credit, typically comprises very small-sized loans of about $100 extended to an individual or a group of individuals, which are called self-help groups (SHGs). Borrowers are generally from the weaker sections of society. The Reserve Bank of India (RBI), the country’s central bank, has urged banks to opt for the SHG model to lend to over 30 million small and micro units, to ensure they have easy access to funds. The Indian microfinance industry comprises NGOs, trusts or societies working on a not-for-profit model, and even bigger players – like Spandana, SKS, Basix, Share Microfin in Andhra Pradesh, Cashpor in Uttar Pradesh, Grameen Koota in Karnataka – which work on a for-profit model. The microfinance industry is estimated to cover about 10 per cent of poor households in need of credit. MFIs first emerged in the late 1990s to raise social and commercial funds for lending to the underprivileged. Today there are over a thousand Indian MFIs, most of which service the rural poor. In this paper, the author is trying to understand on the basis of the study of Turning Microfinance Entities, NBFC and Telecoms into Small Finance Banks and Payment Banks in India and the Impact of these New Financial Inclusions on Indian Banking and Associated Sectors.
Keyword :
Keywords: Microfinance, India, Small Financial Banks, Payment Banks, RBI, Impact on banking and rural sector.