Financial Institutions in the Perspective of Microfinance: An Experiment from Eastern India

The well net work of financial institutions with the provision of fund (savings) mobilization and accession of credit to generate self employment and income by the Self-Help-Groups (SHGs) under microfinance is one of the key instruments for rural development any developing countries. The study attempt to examine the performance of different Financial Institutions (Banks) in connection with phase-wise progress of SHGs from saving linked to project linkage stage upto 2009–10. The study has been conducted with the help of collected data, from different banks and govt. organizations like DRDC, Block Office and Gram Panchayat Offices. The study revealed that under SGSY only one RRB (UBKGB) and only one CB (SBI) has taken leading role in development of SHGs in terms of savings and credit linked. Further, the promotional growth rate from savings linked to credit linkage of SHGs found significantly good but the promotional growth rate form 1^st grading to 2^nd grading and project linkage stage observed less than 20%. It has been examined that UBKGB and SBI jointly have provided 70.5% of the credit with a higher recovery percentage than UBI and CBI but the average volume of credit disbursed found not suitable with demand for entrepreneurship development. Exploration on Microfinance sponsored by NABARD revealed the slower progress of Microfinance in all bank branches but the amount of per SHG savings and recovery percentage found to be higher than SGSY indicating a huge possibility of growth and development of rural people under NABARD through Microfinance.