Delivery Mechanisms and Impact of Training through Microfinance
This paper explores the impact of delivery mechanisms on training provided by facilitators of self-help groups (SHGs). SHGs provide the rural poor with access to financial services. They also provide skill development and human capital training to their members.
The paper evaluates the impact of training in SHGs on two outcome measures, income and assets. Specifically, the study examines whether the impact of training on assets and income depends on the delivery mechanism, namely, linkage model type, infrastructure and training organizer. The paper uses regression adjusted methods to correct for participation and training bias. Findings indicate that:
- Training has a positive effect on assets;
- Impacts are heterogeneous depending on the delivery mechanism;
- Training has greater impact on assets in villages with better infrastructure;
- Training has the least impact on income when banks form and link groups;
- NGO organized trainings have strong impact on assets.
The paper concludes that linkages between banks and NGOs may provide effective means of credit delivery. It calls for an expansion of these linkages and for avoiding the use of government officials as training organizers in the SHG-bank linkage program.
