Impact of Microfinance on Tribal Development in Telangana

The existing rural credit system in India has failed to live up to the expectations and development of the poorer sections of the society. Many empirical evidences bear sufficient testimony to this. Further, the banking system too has failed to deliver when it comes to meeting the needs of the weaker sections of the society especially the women. Therefore, an effective credit delivery mechanism, which could ensure credit delivery in a sustainable manner, has become a necessity. The tribal population in the State of Telangana and in the country as a whole is the most deprived and vulnerable community that faces severe economic exclusion. Although certain constitutional safeguards are provided, there has been no economic, Social and political mobility across these communities. Contrary to Scheduled Castes and other Backward Castes who witnessed certain degrees of progress because of protective discrimination policies of the government, the Scheduled Tribes remain abysmally backward and socially excluded, still living in harsh environs. In this paper an attempt has been made to analyze the impact of microfinance on Tribal Development in Telangana State in terms of household income; assets acquired and employment generation before and after joining SHG and availing micro credit.