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International Conference on Rural Finance Research: Moving Results - page 6 / 9





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This situation is also verifiable in the others states. For example, still for the financial year 2005-2006, the relative share of SHGs represented more than 20 % of the total households for seven Indian districts, as Dharmapuri (Tamil Nadu) and Hassan (Karnataka). Sixteen districts exceeded 15 %, with districts in Assam (Sonitpur and Marigaon), Maharashtra (Chanrapur), Tamil Nadu (Tirunelveli, Tiruvallur) and, of course, in Andhra Pradesh with Nalgonda. At the Indian level, eighty-three districts had a level market penetration of more than 10 %, and 201 districts exceeded the margin of 5 %.

At the district level, the intra-state inequalities are very significant and call into question the successes showed by some states. For example, while Himachal Pradesh is ranked among the states with a high level of microfinanciarization, an intra-state analysis shows significant district inequalities. While Mandi and Sirmaur districts show a strong proportion of households with a person involved in a SHG provided with a bank loan during the financial year 2005-06 (11.91 and 9.16), the reality is completely different in Shimla and Lahul-Spiti districts, with only 0.98 and 0.79. We come across this situation in practically all of the Indian states, more particularly in Andhra Pradesh and Tamil Nadu. While Nalgonda, Cuddapah, Nizamabad and Medak districts showed a level of market penetration of 19.46, 16.37, 16.02 and 14.82 respectively, this level was 3.25, 3.32 and 4.19 in Rangareddi, Guntur and Srikakulam respectively. In the same financial year, these territorial inequalities were stronger in Tamil Nadu. While Dharmapuri, Titunelveli and Thiruvallur showed a percentage of households counting one person involved in a SHG of 24.19, 18.91, and 17.88, the level of microfinanciarization was very small in Nilgiris, Coimbatore and Karur, with 0.92, 1.80 and 3.47 respectively.

Pace of microfinanciarization

Significant state variations occurred in the pace of microfinanciarization. Between 2000 and 2002, the number of SHGs in Rajasthan increased by more than twelve times, from 526 in financial year 2000 to 6948 in 2002. In Uttar Pradesh, on the other hand, the number was ‘only’ multiplied by 1.5 (from 7,744 to 11,490) over the same period of time. Between 2002 and 2004, there was a slowdown in the growth of microfinanciarization, except for areas with few microfinance activities such as in Assam, where the number of SHGs increased by more than eight times from 748 in 2002 to 7229 in 2004. Some of the rare declines, based on the 2002 and 2004 data, were in the states of Nagaland, Sikkim or Manipur.


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