Sa-Dhan, a collective of Impact Finance Institutions including Microfinance Institutions (MFIs) and a Self-Regulatory Organization (SRO) for the microfinance sector, orchestrated a North East Conclave on ‘ Revitalizing the Microfinance sector in North Eastern Region (NER) to accelerate Inclusive Development in Guwahati on August 23, 2023. Microfinance has been playing a crucial role in promoting financial inclusion and reducing poverty in North East India. The microfinance sector in the region faces numerous opportunities as well as several challenges. This microfinance conclave is being organized to bring together experts and practitioners from the sector and discuss opportunities as well as challenges. The critical focus area of the conclave is to explore the arrays of deepening the penetration of supportive finance to poor people along with credit counselling to make it impactful. The multi-stakeholder conclave helps to understand the activities undertaken by different agencies and to build up the combined agenda for larger financial inclusion and create an impact on income generation, health, education and others.
The total loan extended by the microfinance sector during 2022-23 is around ₹ 3.20 lakh crore and the total outstanding is around ₹ 3.52 lakh crore. There are more than 7 crore poor households having active loan accounts with the MFIs. In addition, around ₹ 1.80 to 2 lakh crores are extended through SHG bank linkage programme. Together more than Rs 5 lakh crore outstanding is there under microfinance sector in our country, which is more than 10% of priority sector loans extended by banks. Remarkably, microfinance’s penetration in North-East India is less than 10% (i.e. around 8%) in contrast to the Eastern region’s 32.20% and the Southern region’s 27.87%. Focusing on this backdrop, the Conclave is convened in Guwahati to explore avenues for extending microfinance initiatives to various states in North-East India. The North East portfolio is ₹8,178 Cr is hardly 2% of the industry portfolio, out of the North East portfolio, Assam and Tripura account for 94% of the North East portfolio. Addressing the conference, Mr Sarat Chandra Das, MD of Grameen Development emphasized the role of the microfinance sector in driving financial inclusion in the area. He advocated for the sector’s progression in supporting borrowers to transition into higher-level entrepreneurial activities, with banks providing the necessary backing.
Welcoming participants, Mr. Jiji Mammen, Executive Director & CEO of Sa-Dhan, highlighted that this objective of the Conclave was to discern the unique needs of North-Eastern states in comparison to other regions across the country, thereby paving the way for novel microfinance products and processes that align with financial inclusion objectives. Given the region’s distinct socio-economic conditions, achieving these goals necessitates innovative initiatives. The conclave aims to analyze the policy and regulatory frameworks that impact microfinance in the region and discuss the role of government agencies in supporting microfinance institutions.
