Developing Financial Services for the Urban Poor: The Sharan Experience

This paper looks at some of the issues of developing community based financial services for the urban poor for Sharan, an NGO based in Delhi.

The paper suggests that mobilizing, promoting and operating self-help groups that provide financial services is a very difficult and costly learning cycle for each NGO. However these early difficulties are resources for skills, methods and insights that are intrinsic to both working with communities of the poor and providing financial services. Transforming the experience into a systematic training process for newer entrants into the arena is an important constituent of attempting to reduce learning time and cost. It concludes that:

• Sharan now has a core experience in operating these self-help groups. However these experiences have not led to the development of a formalized or systematic training programme, as the internal team would wish. Unfortunately, most donor funds available today are for increasing lending amounts rather than for building capacity;
• Sharan's experience has shown that by working on improving learning and on improving the efficiency of the programme, mobilizing savings is not difficult.