Commercial Banks and Microfinance: How Andhra Bank Scaled-up the SHG-bank Linkage Programme

This paper describes how Andhra Bank (AB) helped scale up India's self-help group (SHG)-bank Linkage Program (SBLP).

The SBLP, implemented since 1992, has emerged as an important microfinance intervention in India. AB, a public sector commercial bank, has emerged as one of the leaders among commercial banks implementing SBLP. AB has:

• Linked 1,80,885 SHGs with an estimated outreach of 2.39 million poor households;
• Bagged National Bank for Agricultural and Rural Development's (NABARD) Best Bank Award for three consecutive years since 2001 for financing maximum number of SHGs;
• Included SBLP as part of its corporate planning strategy and prioritized its implementation;
• Worked in tandem with the state government towards successful implementation of SBLP;
• Conducted workshops to monitor the progress of SBLP and training programs to orient its staff.

AB has identified strategies to further widen and deepen SBLP. It has plans to provide marketing support SHGs. It would like to support the idea of federating SHGs at village and higher levels for better monitoring of SHGs.