MICRO FINANCE HISTORY OF MICRO FINANCE Fully-incorporated microfinance and community development bank-ShoreBank, founded in 1973 in Chicago. First microloan in Bangladesh in 1974 Economics professor Muhammad Yunus. Accion International, began disbursing microloans in Recife, Brazil as early as 1975. SOURCES OF MICRO FINANCE SERVICES FORMAL INSTITUTIONS Such as rural banks and cooperatives; NGOs. INFORMAL SOURCES Such as money lenders and shopkeepers.

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NAME :- HARSHIT DOSI
ROLL NO. :- 520873425
FROM:- IICE COLLEGE ,
UDAIPUR ( RAJ )

2. CONCEPT
Microfinance is the provision of a
broad range of financial services
such as deposits, loans, payment
services, money transfers, and
insurance to poor and low-income
households and, their micro
enterprises.
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3. HISTORY OF MICRO FINANCE
 Fully-incorporated microfinance and
community development bank-ShoreBank,
founded in 1973 in Chicago.
 First microloan in Bangladesh in 1974
Economics professor Muhammad Yunus.
 Accion International, began disbursing
microloans in Recife, Brazil as early as
1975.
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4. SOURCES OF MICRO FINANCE
SERVICES
 FORMAL INSTITUTIONS
Such as rural banks and cooperatives;
NGOs.
 INFORMAL SOURCES
Such as money lenders and shopkeepers.
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5.  Began in 1976 in
Bangladesh
 Professor Muhammad
Yunus, Founder of
Grameen Bank
Prof. Muhammad Yunus,
Founder, Grameen Bank
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6. 16 DECISIONS OF GRAMEEN BANK
1. We shall follow and advance the four principles of
Grameen Bank --- Discipline, Unity, Courage and Hard
work – in all walks of our lives.
2. Prosperity we shall bring to our families.
3. We shall not live in dilapidated houses. We shall repair our
houses and work towards constructing new houses at the
earliest.
4. We shall grow vegetables all the year round. We shall eat
plenty of them and sell the surplus.
5. During the plantation seasons, we shall plant as
many seedlings
as possible
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6. We shall plan to keep our families small. We shall
minimize our expenditures. We shall look after our health.
7. We shall educate our children and ensure that they
can earn to pay for their education.
8. We shall always keep our children and the
environment clean.
9. We shall build and use pit-latrines
10. We shall drink water from tubewells. If it is not
available, we shall boil water or use alum.
11. We shall not take any dowry at our sons' weddings,
neither shall we give any dowry at our daughters wedding.
We shall keep our centre free from the curse of dowry. We
shall not practice child marriage

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12. We shall not inflict any injustice on anyone, neither
shall we allow anyone to do so.
13. We shall collectively undertake bigger investments
for higher incomes.
14. We shall always be ready to help each other. If
anyone is in difficulty, we shall all help him or her.
15. If we come to know of any breach of discipline in
any centre, we shall all go there and help restore
discipline.
16. We shall take part in all social activities
collectively

9. ACHIEVEMENTS OF MICRO
FINANCE
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10. ACHIEVEMENTS
 3.5 million borrowers
 $4.4 billion lent
500 types of micro-businesses
average amount: $160
peer support and pressure
$4.1 billion repaid
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“We have received a lot of things from the international
community, but we given the model of microcredit to the
world”.
- Prime Minister Begum Khaleda Zia

11. ISSUES
 HIGH COST OF CAPITAL
Effective cost of micro lending is 24-
26%
 BORROWINGS TO MFI
Priority Sector-funding obligation.
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12. ISSUES
 MANAGEMENT OF FUNDS /
FINANCING SOURCES
 CAPACITY OF MFI
Innovative product, strategic linkage and
re-engineering of financial products.
 SUPERVISION AND REGULATION
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13. CHALLENGES
 Regional imbalance
 Credit to enterprise
 Growth of micro finance services
 Financial viability and sustainability of the
MFIs
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14. CHALLENGES
 Designing financially sustainable models
 Aim for community participation &
ownership
 Increase outreach and scale up operations
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15. OPPORTUNITIES
 Huge untapped market- an attractive
business proposition for commercial
banks.
 Scaling up of MFIs to expand and more
out reach.
 Partnership with matured MFIs.
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16. CONCLUSION
 No one model can be replicated, so
models to be tailored according to the
requirement of the place.
 Micro Finance, a good business for
commercial banks.
 Requirement of an appropriate delivery
model and a mature partner.
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