Sa-Dhan Newsletter Volume 5 Issue 2

Operational Costs of Delivering Microfinance : Banker's Perspectives

Sa-Dhan Newsletter

Volume 5, Issue 2 August 2004

Special Issue

Sa-Dhan

Sa-Dhan

The Association of

Operational Costs of Delivering

Community Development

Microfinance : Banker's Perspectives

Finance Institutions

From the Editor's Desk

CONTENTS

Dear Readers,

1. Micro Finance and

Commercial Banks

The previous issue of our newsletter was on the operational costs of delivering

microfinance from the practitioners perspectives. This time we are bringing to you the

2. Oriental Bank Grameen

same theme but from the view point of the bankers. However, as banks have not

Project

published data on product costing. Therefore, the contributors in this issue generally

focus on the issues related to microfinance and priority sector lending and not directly

3. Micro-Finance & Public

to the costs of operation. In this issue we bring you four articles.

Sector Banks

The Article, "Microfinance and Commercial Banks" by Mr. Sundarashym and Salim

4. Priority sector lending

mainly addresses to the constraints faced by commercial banks in delivering financial

services to poor clients. They lone examined the issue at two levels- constraints in

5. Budget Features Relevant

human resources cost effectiveness. They hope that banks and MFIs can partner

For Non-Profit

together in the future.

Organisations

MA Krishnan talks about growth and development of the concept of priority sector

6. Sa-Dhan's Publication

lending (micro financing) as a by-product of planned development of the country.

Besides, he has dealt with the progress of microfinance in terms of quantitative terms

with the qualitative achievements. He talks about the practices of the government

7. Sa-Dhan's Mission

replicating and trying to transplant the model of the NGOs working with women but

statement

that failed due to presence of subsidy component in the design. He has suggested

issues that need attention, especially if the microfinance sector market is to grow in an

orderly fashion.

Edited by :

Mr. Ravinder Yadav has presented the approach of Commercial Banks in delivering

Mathew Titus

micro-finance services at the door step of the poor. He has examined the inception of

microfinance in Oriental Bank of India, its growth over the years, functional mode,

For Private Circulation Only

target groups and group formation, economic status of the target groups, delivery

mechanism, and financial viability of the project.

The article on the Priority Sector Lending examines performance of Public sectors

Published by :

banks advances made by the foreign banks and the private sector banks- their short

Sa-Dhan

fall in meeting the sub-targets sets on agricultural and to the weaker sections of the

12 & 13, 2nd Floor

society. Besides, it also examines the performance of the rural infrastructure

Special Institutional Area

development fund (RIDF), Kisan credit Cards, microfinance and Non- Banking

Shaheed Jeet Singh Marg,

Financial Companies (NBFCs).

New Delhi-110 067

E-mail: sa_dhan@mantraonline.com

Happy reading!

Website: www.sa-dhan.org

Mathew Titus

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