Microfinance India: State of the Sector Report 2011

This report discusses India's microfinance sector post the crisis of 2010. It describes the landscape and the changing policy environment. The report states that the microfinance sector recorded positive growth during 2011, despite the crisis in the state of Andhra Pradesh. The growth rate of the self-help-group (SHG) bank linkage program (SBLP) continued to be moderate. SBLP and MFIs together achieved a growth in their customer base of about 10.8%. Combined borrowing customer base increased to 93.9 million from 86.3 million in the previous year. The report is organized into 11 chapters, each of which addresses a specific aspect of microfinance and financial inclusion. Topics in the report include SBLP, MFI recovery, investment climate, social performance management, policy environment, and National Rural Livelihoods Mission. The report outlines recommendations for the future, stating that MFIs:

• Need to demonstrate that they are relevant and appropriate institutions for dealing with the problems of the poor;
• Should resist being swayed by commercial considerations and market valuations;
• Should not lose their focus on the customer;
• Need to revisit their mission and vision and reset their expectations.