Status of Micro Finance in Karnataka: Women Empower-Ment and Pov Erty Alleviation Through Self Help Groups—A Study

Abstract

One of the greatest challenges before the Indian sub-continent which accommodates more than one-third of the population is poverty. India, one of the BRIC nations with more than 1.2 billion population is seen by many developed countries as an emerging economy. India's economic growth has failed to make a significant improvement in its poverty figures with 400 million-more than the total in the poorest African Nations still stuck in poverty. Government of India with its concern started various poverty alleviation programs but they have failed to deliver the objectives to the level which is desired. The reasons may be many such as failure to reach the target group, loopholes in the system, developing a robust mechanism to name a few. Many countries including India experimented with subsidized credit which only led to increase in the NPAs. The microfinance has come forward to fill up the gap. But the outreach is too small as compared to the requirement and potential. However there is some progress in this regard after active role played by NABARD and formation of SHGs groups. A number of NGOs and MFIs have also delved into the business. Some of them have also started in a big way and have started making profit by issuing IPOs (Initial public offers). But certain development in recent years has brought a fresh focus on the problem of regulation in field of microfinance. The paper delineates three distinct aspects of microfinance, first growth of microfinance in India and some other countries; secondly it discusses the role played by NABARD and other National Banks in growth of SHGs and Grameen Bank. Third, it deals with the role of government in framing legislation for protection of right of micro borrowers. The study also deals with the need for a regulatory body to regulate, develop and guide the numerous MFIs and NGOs who work in the field of microcredit. The paper discusses the factors and theoretical position associated with evolution of microfinance in Karnataka women empowerment and poverty alleviation through SHGs its role in national scenario.