Microfinance & Women
Empowerment :A case study
of Punjab.
Presentation by
Jaskiron Kaur
Deptt. Of Applied Management
Research Scholar
Punjabi University Patiala
January 2012
Across Centuries, the role of women remains rooted into eternity .Time has gone
through many transitions but the status of women remains same .The word
empowerment refers to increase in the spiritual,political,social racial, educational
,gender or economic strength of individuals and communities. Empowerment is
having / developing confidence in their own capabilities. Most of the women rely
on the informal work sector for income. The strategy to empower women to
motivate them to create or have their own non-profit organization using the
rationale that only marginalize women so that they themselves can know their
own people need most and that control of the organization by outsiders can
actually help to further entrench marginalization. Micro finance through the
network of commercial banks, Cooperative, RRB’s, NGO’s and NABARD has
played a major role .MFIs are working for creating a financial provision for the
poor. The study is aimed at analyzing the impact of microfinance on socio
economic, familial, interpersonal, Legal, Political and psychological
empowerment. The study is empirical in nature and based on mainly primary data
collected from the field survey .The empirical finding shows that the
empowerment of women is established in weak form. The paper has important
policy implications. It is appropriate to emphasize the strategy of financial
inclusion in the wider sense of economic growth and financial deepening.
Robert (2008) in his study titled, “Microfinance Meets the Market” aims to provide
reliable banking services to poor customers in a commercially-viable way and analyzes
the tensions and opportunities of microfinance as it embraces the market by drawing on
a data set that includes 346 of the world’s leading microfinance institutions and covers
nearly 18 million active borrowers. The study shows that there is a remarkable success
in maintaining high rates of loan repayment, but the study also suggests that profitmaximizing investors would have limited interest in most of the institutions that are
focusing on the poorest customers and women. He concluded that those institutions,
as a group, charge their customers the highest fees in the sample but also face
particularly high transaction costs, in part due to small transaction sizes and
suggest innovations to overcome the well-known problems of asymmetric
information in financial markets.
Tonya (2009) in his study titled, “Microfinance and the Commercial Banking
System” observed microfinance as a core component in the development aid
programmes, non-governmental organizations (NGOs) and other development groups
with the aim to reduce poverty and also, raise the status of women and disadvantaged
communities. The author discovered that central banks and the banking sectors in
general can promote good and inclusive financial governance in developing countries by
adopting microfinance practice and by integrating pro-poor policies into their banking
systems. Focusing on the case of Barbados, the study examined the importance of
microfinance for commercial banks. The study concluded that the integration of
microcredit into the banking and credit schemes of commercial banks and
microfinance institutions is a key to promoting good governance.
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Jerniabi et al. (2009) in his study titled, “Microfinance and Empowerment of
Muslim Women : A Case Study of SHGs in Coimbatore City of Tamil Nadu”
examined large number of parameters in his study like Mobility, recognition in the
family or in the ouservices, credit sources, asset building and involvement at different
levels of decision- making .The study has shown changes in the socio-economic status
of beneficiary after joining SHG, whether the status has increased or decreased or it is at
the same level. The authors recommend that planning for women self-employment
needs a multi-pronged strategy, procedures for credit access to women should be
more easy and simple and further there is a need to evolve new products by the
banks which help in long-term sustainability. The study simply demonstrates that
SHGs among Muslim women have created conducive environment for growth and
development of micro enterprises meeting out the credit needs of its members in
terms of improved socio-economic status, income earnings, mobility and confidence
building to sustain and manage business on their own.
The above survey indicates that though a large number of studies have been
conducted on this subject, but no worthwhile research has been conducted related
to the measurement of overall performance of microfinance for the empowerment
of women and weaker sections of the society and poverty alleviation in Punjab.
Although in the present arena so many reservation quotas are prevailing for the
suppressed people and women but still there exists a glass ceiling. The present
study titled, “Microfinance and Empowerment of Weaker Sections of Society: A
Case Study of Punjab" is an attempt to fill the gap.
Objectives of the Study
• To assess the activities of Microfinance Institute.
– The process
– Procedure & Implementation
• Impact Study of Microfinance for empowering women.
– Socio Cultural, Economic, Interpersonal, Legal, Political
and Psychological
• Negative Impact on Women & Limitation to
Empowerment
The core Process of Microfinance Institute
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Village Survey
Projection / Mini projection Meeting
Group Formation
Compulsory Group Training
Group Reorganization Test
Center Meeting
Proposal Meeting
Documentation
Loan Utilization Check
Village Survey
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Road Accessibility
Village population
Minimum 60 house holds
Branch to below 25 Km's
Political stability & Safety
Other MFI repayment
Agricultural land ,Daily wages
Migration sources
Economic Activities
STAFF SELECT VILLAGE ON BASIS OF POVERTY, POOR HOUSEHOLDS,
ROAD ACCESSIBILITY, POLITICAL STABILITY AND SAFETY
Village survey assesses
population, economic
activities, agricultural
land, sources of
irrigation, and presence
of government
development programs
Initial Projection
meeting and follow-up
visit for interested
villagers and to directly
appeal to those hesitant
due to religious, class,
caste, or gender barriers
Groups are self-formed
and undergo 4 days of
Compulsory Group
Training to learn
arithmetic, how to sign
their names, the
importance of savings,
and collective
responsibility
Loans are distributed to the
group members at weekly
center meetings.
Disbursements are
staggered to inculcate
credit discipline.
Repayments are collected
over subsequent weeks
Compulsory Group Training
1.Greet members Namaste
2.Introduction – Field assistant
3.Introduce - organization
4.Introduction - members
5.Teach Signatures
6.Distribute pledge papers group members
7.Explain Purpose of 05 member group
(seeds as a visual)
8.Explain group characteristics
9.Explain responsibilities group leader
10.Members choose 2 group leaders
11.Explain member ship fee & inform members to pay
12.Close meeting – recite pledge
Projection / Mini projection
Meeting
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Pre-projection meeting in branch
Projection meeting place public places or Govt. buildings
Before 1 hour reach village
Senior staff ,ABM,BM
CGT lights, mat, visual aids ,chalk powder
Staff Introduce
Why do we credit ?
Why poor ?
Why only women center ?
products details
Interest details
Loan repayments
Group Reorganization Test
1.Housing survey verification by BM with Staff
2.Open session with pledge
3.Members practice signatures
4.Collect member ship fee
5.Members take Group recognition Test by 3 days CGT process
6.Ensure group under stands rules/ policies
7.Group & Center response for members
8.Members signature on GRT form
9. FA signature on GRT form
10.BM signature on GRT form
11.Close meeting – recite pledge
Parliamentary Committee
on
Empowerment
of
Women
 National Commission for
Women

 What,
Why ,When, Who ?
Policies
• Loans issued & Applications taken –group attendance 100%
Center attendance 75%
• Replacement 1 day CGT ,2nd day GRT
• Replacement 1 day before drop out
• Replacement member 3rd week application taken ,4th week
loan issued
• CGT ,GRT conducted only 3 groups
• MTL issued 21st –40 th week
• Disbursement 02:03 maintain
• Member ,FA new padam telling
• Center meeting group wise members sitting right side by
Staff
Objective -2
Impact of Microfinance for
empowering women.
Impact on Economic decision making
Impact on Self Confidence
Impact On women‘s Status and Gender Relation in house
Impact on Family Relationships and Domestic Violence
Impact on Women‘s Involvement and status in the
Community
Impact on Political Empowerment and Women’s Right
Negative Impacts on Women and Limitation to
Empowerment
Holistic approach to Empowerment
Health
& Nut.
Water & San.
Political
Participation
Education
Asset base
Skills
Marketing
Technology
Credit
The study will answer the following ?
Does participation in MFIs increase the woman’s influence over
economic resources and participation in economic decision making?
Does participation in MFIs influence the individual development and growth
of a woman?
ls there an increase in a woman’s influence in decision making in the
household?
Has participation in MFIs increased a woman’s mobility, development of
networks and interactions with other members of her group and
community?
Does participation in MFIs increase a woman’s awareness and knowledge?
An empirical study on empowerment of women conducted in Patiala Punjab
This study has been conducted by me in Patiala district of Punjab 2011.100
SHGs in Sanour, Sangrur, Ablowal ,bhadson ,Kauli and kakrali are some of the
villages of Patiala district in Punjab have been selected purposively. This
district was selected on the basis of highest number of SHGs formation. Two
members from each group have been selected. These sample members are
asked questions on the economic decision making variables, purchase
variables, purchase variables, control over loans, and control over income and
savings etc.
•Basic socio-economic characteristics of the sample SHGs members
In the present study,
About 88% of the SHG members belonged to the age group 21 to 50 years which is the most
productive period. Among the respondents, about 20% were in the age class 36-40 years,
12.73% in 31-35 years, 30.09% in 26-30 years and 9.09% in 41-45 years and 5.46 % in 46-50 years
More than 63% of SHG members belong to the SC and ST
The education level of SHG members in satisfactory. More than 80% SHG members have got
primary and high school level of education
The sample SHG members tool loan up to 4 times. The average present loan per SHG member is
Rs. 5024/-. The average first, second and third loan per SHG member is Rs. 2273.00, Rs. 3533/and Rs. 4772/- respectively.
The average saving per SHG member is Rs. 2055/The SHG members who took loan and most of the loan utilized in consumption purposes except
3rd loan. Consumption consists of medical purposes, education of children, house construction,
and repayment of old debts etc
Impact on Women Economic Decision Making
For each of four economic issues, women were asked how their household arrived at decisions and
whether they themselves spent money on such projects.
The issues were
(1) house repair and construction,
(2) live stock sale and purchase
(3) borrowing money
(4) transaction involving household equipment. For the last three issues, roughly half of respondents
answered that they and their husbands jointly decided on the issue and implemented the action together
(53,54 and 47% respectively).
For the issue of housing repair/construction the figure was about two theirs. For each issue less that 3%
of respondents answered that they themselves decided on these issues along. Similarly, for all four
issues almost all the respondents (98,98,97 & 98.5% respectively) said that they themselves do not spend
money in such matters rather it is the husband that actually handled the money in the transaction.
Purchasing capacity
For sever categories of common household purchases (food, toiletries, candies for the children, cooking,
children’s clothing, and own clothing) women were asked whether or not they make the purchase
without their husbands permission. The percentage of women who answered that they make purchases
themselves varies widely by category, from less than five percent (for furniture) to more than 60% (for
candies and house hold utensils)
Impact On women‘s Status and Gender
Relation in house
Even if they are poor or powerless or as power less as a poor woman but because
of the social norms or can say patriarchal structure male remains privileged in the
family. In some cases the gender relation in the house hold has become better
when the house become a comfortable place to work. Status within the
community is also enhanced during the scheduled interview one husband
commentated that it is good that she is earning as she is not asking for money for
her personal requirement.
Impact on Family Relationships and
Domestic Violence
The number of incidence can be quoted where they has a tarnish
relation. Three different observations were seen
Increased violence.
Both started working (as husband)
Evidence suggested micro finance have given them a mean to escape
from abusive relation
Impact on Women‘s Involvement and
status in the Community
The study shows that women themselves
relies/perceive that they received more
respect from family and community and their
success in business is highly visible
Observations
Increased in knowledge
Increased in self confidence
Increase in self esteem
Negative Impacts on Women and Limitation
to Empowerment
Negative impacts
Limitation to empowerment
Both man and woman assume stress and
dependency
Additional risk and responsibility
Husband takes all the controls over loan
amount
Knowledge & Awareness
Completely
Sometimes
rarely
never
2
To large
extent
3
Group Activities
1
4
5
Meeting calendar of the group
1
2
3
4
5
Rules and regulations of the group
1
2
3
4
5
The group record
1
2
3
4
5
Cash in hand of the group
1
2
3
4
5
Balance in bank account of the group
1
2
3
4
5
Total Loaning of the group
1
2
3
4
5
How many group member have taken loan
1
2
3
4
5
Members repaying loan regularly
1
2
3
4
5
The dealing bank
1
2
3
4
5
Income of the group through interest/fine
1
2
3
4
5
The objective of the Group
1
2
3
4
5
Bank transaction
1
2
3
4
5
Constrained of the group
1
2
3
4
5
Achievement of groups
1
2
3
4
5
Training & Orientation
Completely
Sometimes
To large
extent
rarely
never
Not at all
To a very small
extent
To small
extent
To a
large
extent
To a very
large extent
Training given by MFIs On site (at the place work place)
1
2
3
4
5
Training given by MFIs off site
1
2
3
4
5
Industrial visits conducted by MFIs
1
2
3
4
5
Do you think training has covered all the technical aspects required
1
2
3
4
5
Workshops conducted by MFIs were knowledgeable.
1
2
3
4
5
MFI training helped in marketing linkage.
1
2
3
4
5
The programs conducted by MFI have given you skill set to work.
1
2
3
4
5
Impact of training, orientation & exposures
Do you think after joining MFI
Not at all
To a very small
extent
To small
extent
3
To a
large
extent
4
To a very
large
extent
5
You have knowledge on your Rights
1
2
You are aware of your entitlement as a member of group.
1
2
3
4
5
Your confidence has increased towards work.
1
2
3
4
5
You have attained the skills to work.
1
2
3
4
5
You have better linkage with banks
1
2
3
4
5
You have knowledge of schemes/ Govt. benefits available
1
2
3
4
5
You have better market linkage
1
2
3
4
5
You have enhanced your income.
1
2
3
4
5
You actively participate in decision making in the family
1
2
3
4
5
Your confidence has increased towards work
Economic decision making
Yes
To a large
extent
To some
extent
Rarel
y
Never
Use of loan amount
1
2
3
4
5
Regarding the business/work to be started with the loan amount
1
2
3
4
5
Regarding the use of income generated by the business
1
2
3
4
5
Regarding the spending of your income/earning
1
2
3
4
5
Do you think you can take decision for house hold infrastructure/ smokeless
chulla/house hold repair
1
2
3
4
5
Do you think you can take decision for house hold purchases like farm equipment/live
stock
1
2
3
4
5
Development & Growth
Strongly Agree
Agree
rarely
Disagr
ee
Strongly
disagree
Your literacy level has increased
1
2
3
4
5
Your education level has increased
1
2
3
4
5
Your knowledge for the work has increased
1
2
3
4
5
You can manage work independently
1
2
3
4
5
You can arrange meetings independently
1
2
3
4
5
You can express your views independently
1
2
3
4
5
Your family/people respect you and your decisions.
1
2
3
4
5
You have better market linkage
1
2
3
4
5
You have enhanced your income.
1
2
3
4
5
You actively participate in decision making in the family
1
2
3
4
5
Voicing Concern
After joining MFI ,do you think you
Not at all
To a very small
extent
To small
extent
To a
large
extent
To a very
large extent
Can take decision for education of your children
1
2
3
4
5
Can take decision for the education of girl child
1
2
3
4
5
Can take decision for carrier of your children
1
2
3
4
5
Have freedom for willful dresses
1
2
3
4
5
Have freedom to choose life partner
1
2
3
4
5
Have freedom to use family planning methods
1
2
3
4
5
Have better check on domestic violence/alcoholism
1
2
3
4
5
Can take an action against dowry system/ pardah system
1
2
3
4
5
Political empowerment
Since you have joined an MFI you
Very often
occasionally
often
Rarely
never
Participate in the meetings of village panchayat
1
2
3
4
5
Participate in the meeting of village gram sabha
1
2
3
4
5
Participate in the elections as a voter
1
2
3
4
5
Participate as a candidate in the local body candidates
1
2
3
4
5
Have ever been selected as a member
1
2
3
4
5
People perception towards woman working in MFI
Since you have joined MFI People consider you as
Strongly Agree
Agree
rarely
Disagre Strongly
e
disagree
A part of well organized family
1
2
3
4
5
Heaving Good relationship with husband
1
2
3
4
5
You have control our savings and Expenditure
1
2
3
4
5
You are considered as more aware and respected woman
1
2
3
4
5