Impact of Participation in Dairy Microfinance Module: Implications for Future Reforms in Credit Delivery

This study has investigated the household level impact of participation in microfinance module in the Jalgaon district of Maharashtra. Using multistage random sampling, 160 sample households (80 SHG member households and 80 non-SHG dairy farming households) were selected from four tehsils of the district. The study has revealed beneficial impact of participation in dairy microfinance module in regard to such parameters as production, consumption and marketing of milk, income generated from dairy enterprise, adoption of superior breeds of dairy animals, mobilization of savings and acquisition of productive assets. The SHG-member households were more efficient in production of milk at a lower per unit cost, thus enabling them to make significantly higher profits than their non-SHG counterparts. Thus, it could be implied that microfinance can become an effective tool for empowerment of the resource-poor rural community through dairy enterprises. Some policy suggestions are also given to improve the performance of dairy SHGs in the study area.