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8/7/2019 47366647 Micro Finance Ppt
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MICROFINANCE
Presented By
Sangeetha.S
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Microfinance
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Provision of financial services to low
income clients
Loans Savings Insurance Remittance
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Microfinance Services Regulation Bill
Definition of Microfinance
Providing financial assistance to an individual or an eligible client,
either directly or through a group mechanism for:
An amount, not exceeding Rs.50,000 in aggregate per individual, for
small and tiny enterprise, agriculture, allied activities (including for
consumption purposes of such individual) or
An amount not exceeding Rs.1,50,000 in aggregate per
individual for housing purposes
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Type of entity Non-profit Mutual benefit For-profit
Association Society under Societies
Registration Act 1860
Eg: SAMRUDHI Micro
Fin Society in
Karnataka
Cooperative which can
be just a savings and
credit cooperative or be
further licensed as
cooperative bank
Association of
persons
Trust under
Indian
Trusts Act 1920
Charitable trust
Eg:Mahasemam Trust
in Tamil Nadu
Mutual benefit trust Investment trusts
Company under
Indian
Companies Act,
1956
Section 25 Company
Eg: Cashpor in UP
Mutual Benefit (Sec
620A Nidhi Company)
Company which is
further either an
NBFC or a bank
Eg:Share
Microfinance in AP
Forms of MFI
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State Maharashtra
No.of MFI's HO in the state 18No.of MFI's HO & Branches 28
Client Outreach 1169306
Portfolio Outstanding 3840548354
No. of districts served 38
Out of which no. of poorest
districts 18
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3226
23 2118 18
14 13 117
0
5
10
15
20
25
30
35
No. of MFI Head Office in State
No. of MFI
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Outstanding Portfolio (in Rs. Crore) FY 2007 FY 2008
SBLP* 10,644 16,900
Sa-Dhan, 223 MFIs 3,456 5,954
Total** 13,582 21,961
Client Outreach (in million persons)
SBLP* 16.01 21.57
Sa-Dhan, 223 MFIs 10.04 14.1
Total** 24.55 33.55
In the financial year 2007/08, Microfinance in India through its
two major channels SHG-Bank Linkage Programme (SBLP)
and MFIs served over33 million Indians
Service Volumes
Bharat Microfinance Report - Quick-Data 2008
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Self-Help Group (SHG)
A Self-Help Group (SHG) is a registered or
unregistered group of 10-20 individuals havingHomogenous social and economic background
To save small amounts regularly
To mutually agree to contribute
To a common fund andTo meet their emergency needs on mutual help basis.
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Joint Liability Group(JLGs)
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Internal
Auditor
GENERAL ORGONOGRAM OF AN MFI
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Branch Identification And Set Up
The area in consideration should have :
1. Proximity to the targeted villages
2. Availability of public transportation for staff
3. Proximity to bus stand, market place etc.4. Easy access to local commercial banks
5. The availability of telephone and internet facility
6. Availability of proper building for the branch office
7. The distance and means of transportation to theHead Office
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Branch Staffing Structure
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Registers and displays to be kept
in Branch Office
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SlNo Name of the Register Description
1 Master Register Master Register contains the details of allmember/group registered with SMFL. Onregistration of new group/member or on
dropping off the details of the group/memberis entered in the Master Register.
2 LAAD Index Register(Loan Application
Agreements andDocuments )
LAAD Index Register contains the details ofthe Loan ApplicationAgreements andDocuments kept in the branch. This is usedfor the easy reference of LAAD in future.
3 Proposal Cum Disbursementregister
Proposal cum disbursement register is usedto track the status of loan request generatedin the branch till its disbursement.
4 Loan Committee Minutes Loan committee minutes contain the detailsof loan sanctioned/rejected during thedeliberations in the Loan Committee
Meeting.
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5 Inspection Register Inspection Register containscomments/recommendations made by any seniorofficer of SMFL during his/her visit to the branch.
6 Cash Book Cash book documents both cash receipts anddisbursements.
7 Ledger Abook of accounts, in which the results of business
are arranged under various heads as described inthe Heads of accounts
8 Asset Register Asset Register is a record of items consideredworthy of identification as discrete assets. Aphysical asset register includes information abouteach asset, such as purchase cost, date of purchase
etc.
9 Stock Register Stock Register is a record of items stored in thebranch for distribution free or for cash like PassBook, GroupAccount Books, Loan Application,Agreement and Documentation and other printedmaterials.
Sl No Name of the Register Description
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10 Attendance Register Branch Manager should manage anattendance book for the staff reporting tohim.
11 Movement Register Movement Register is used to track the staffmovement. Staff leaving out for any officialpurpose has to declare the time andpurpose
12 Inward OutwardRegister
Details of all in-coming and out-goingletters and e-mails are to be numbered and
entered in this register.
13 Receipt BookTracking Register
Details of receipt book issue are recorded inthis register
Sl No Name of the Register Description
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Self Help Group
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CLIENTIDENTIFICATION
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Basic Characteristics of Clients
Low & middle income group from the neighbourhood
Members should be women
Age bracket of 18 years to 55 years
No two women from same house hold can havemembership in same group
Group should have 10 to 15 members
Involved in a variety of income generation activities
Average house hold income of Rs. 1500 to Rs. 12000/- per month.
Illiterate/ semiliterate people
Un-banked segment
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Possible client Needs
Enterprise needs mainly fordevelopment, diversification and expansion of
business
Health and education
Debt Redemption
Basic household consumption
Emergency Needs
Meeting housing needs - mainly for building /repairing of houses
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PR
O
C
E
SS
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1. Group Formation:21
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Promotional Meeting
Following topics are covered on day-1
About the MFI and its activitiesMembership requirements
Goals of the group
Group Recognition Test (GRT)
Group registration procedures Loan product details, loan documentation and
its repayment
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Following topics are covered on day- 2
Importance of the meeting
Meeting Procedure
Roles andResponsibilities of the group members andgroup leaders.
Books to be maintained in the group
Attendance Book
Individual Savings Card
Group Savings Card
Individual Loan Card
Group Loan Card
Loan Documentations
Promissory Note Group
Promissory Note Individual
Inter-seAgreement
GroupDeclaration
FacilityAgreement
Group Receipt
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Immediately After The GRT, The
Following Documents Are Collected1. Registration Form -Along with Photos,ID Proof
The Field officer along with the members fill the reg.Form
and admission fee2. After collecting the fee ,spot receipt is given3. Bye-laws are given-Group undertaking the
responsibility4. Seal to be made5. Individual pass books and a Sangam pass book6. Sangam savings cum loan register7. Minutes Book-(Fills during meeting days and
important in case of loan )
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2. Loan Application Process
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The following documents are collectedalong with the application form
1. Loan application-both Sangam & individual
2. Loan Requisition Sheet3. Interse agreement
4. Photo along with ID proof
5. Self Declaration
6. Minutes copy of the Sangam7. In case of 2nd loan cycle-Grading sheet is submitted
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GROUP Loan
Loan Amount
(Product)
Cycle Loan Limit (Per member) InstalmentsLoan
Tenure
1st Loan Cycle Maximum Rs. 8,000 50 Instalments 12 months
2nd Loan Cycle Maximum Rs, 12,000 50 Instalments 12 months
3rd Loan Cycle Maximum Rs. 15,000 50 Instalments 12 months
4th Loan Cycle Graduates to Individual loan product
Note:
y Loans will be given in multiples of thousands only.
y The figures given against each cycle are the maximum that can be availed
y Loan amount will be sanctioned based on the members income generation
activity and the repayment capacity.
Price
Interest Rate 15% per annum on a declining basis
Processing Fee 1% of loan amount collected upfront
Risk Fund 1% of loan amount collected upfront
Penalty
1% on the due amount (instalment)
for the number of days for which the
amount was due
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3.Loan Disbursement
Process
Accountant fills the paymentvoucher
Accountant collects 3%service charge along with 1%
insurance coverage fee
Gives receipt
Signs the Demand PromisoryDelivery Letter
Loan disbursement Report isfilled by the C.O. and verified
by BM
Loan disbursement report andVouchers and Fund Transfer
Notes (FTN) are sent to the H.O
Verification in Head Office
Submits consolidated reportto the Operations Head
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4.Loan Repayment Process
Repayment begins within 11 days after disbursement
Loan duration-50 weeks/12 Months
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C.O. Fills
FCDCR
Sangam loan cumsavings register
Spot receipt
C.O. Also fills thesangam passbook
and checks the
sangam minutes
FCDCR is dulyfilled ,BM verifies
and signs
Branch accountantcollect the cashfrom the C.O. And
fills the DCS
The accountantfills the FTN
DCS ,FTN &FCDCR sent to
H.O
H.O.Accountantverifies cash
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THANK YOU !
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