WOMEN EMPOWERMENT THROUGH MICRO FINANCE & TURNING

CHALLENGES INTO OPPORTUNITIES -: INDIAN SCENARIO

Rashmi Ranjan Panigrahi
A!ri" #$%
Paper type: Empirical Paper
ABSTRACT
This conceptual paper indicates and emphasizes the women entrepreneurs as the potentially emerging
human resource in the 21st century to overcome the economic challenges in global perspective. Women
of 21st century is no more a traditional resource confined to homes only rather an educated,
knowledgeable and innovative part of the overall population possessing the capacity to transform
economies into thriving enterprises. Microfinance is often used to refer to financial services for poor
and lowincome clients. !n practice, its definition is narrowed down to loans and other services from
providers identifying themselves as "microfinance institutions," #M$!s%. More broadly, microfinance is a
movement envisioning a world where lowincome households have permanent access to variety of high
&uality financial services, including savings, insurance and money transfers. 'etween the 1()*s and
1(+*s, governments and donors concentrated on providing agricultural credit to small and marginal
farmers in a bid to raise productivity and incomes. !n the middle of the 1((*s, "microfinance," started to
replace the term "microcredit," referring to a range of financial services to the poor, not ,ust credit.
-overnment can support microfinance by setting sound macroeconomic policy, providing stability and
low inflation. Microfinance sector is having a healthy growth rate, there have been a number of
concerns related to the sector, like grey areas in regulation, transparent pricing, low financial literacy
etc. .eveloping and developed nations have realized that developing women entrepreneurship is
indispensible to flourish as economically dominant nation in the modern hightech world. Therefore,
creation of platforms and networks for entrepreneurial culture are prominent issues globally.
Research design and Methodology: This is a concept paper and the researcher has adopted the
method of reviewing different research articles, research ,ournals, and case studies, to collect data
about entrepreneurship and woman entrepreneurship which is conse&uently incorporated as a concept
paper drafted by the researcher.
Key Words: Entrepreneur: Challenges: Opportunities: SHGs: WPR: Empowerment
Mr& Rashmi Ranjan Panigrahi, L'()*r'r in Finan('+ Finance, Dept- !"# FC $aster o%
Finance an& Control'# CO -E&ucation, "R(" SCHOO) OF "*"GEE*+ , -+, !hu.aneswar-
/01213, Contact Details: 3//4/430/2, panigrahirashmi176@gmail.com
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
In)r,-*()i,n ), Mi(r,.inan('

Rash'i Ran(an Panigrahi)
S*santa Satapathy+
+o most, micro%inance means pro5i&ing poor %amilies with 5er6 small loans $microcre&it' to help them
engage in pro&ucti5e acti5ities to grow their tin6 .usinesses7 O5er a perio& o% time, micro%inance has
come to inclu&e a .roa&er range o% ser5ices $cre&it, sa5ings, insurance an& others' as it has .een reali8e&
that the poor, who lac9 access to tra&itional %ormal %inancial institutions re:uire a 5ariet6 o% %inancial
pro&ucts7 icro%inance starte& with the recognition that poor people ha& the capa.ilit6 to li%t themsel5es
out o% po5ert6 i% the6 ha& access to a%%or&a.le loans7 High repa6ment rates in the in&ustr6 ha5e change&
the perception that the poor are not cre&it worth67 With the right opportunities, the poor ha5e pro5e&
themsel5es to .e pro&ucti5e an& capa.le o% .orrowing, sa5ing an& repa6ing, e5en without collateral7
Fin& out more a.out micro%inance in this section7
Concept o, Micro-,inance : icro-%inance is a tool %or empowerment o% the poorest7 Deli5er6 is
normall6 through Sel% Help Groups $SHGs'7 -t is essentiall6 %or promoting sel%-emplo6ment, generall6
use& %or: $a' &irect income generation7 $.' Rearrangement o% assets an& lia.ilities %or the househol& to
participate in %uture opportunities an& $c' Consumption smoothing7 -t is not ;ust a %inancing s6stem, .ut
a tool %or social change, especiall6 %or women7 !ecause micro cre&it is aime& at the poorest, micro-
%inance len&ing technolog6 nee&s to mimic the in%ormal len&ers rather than the %ormal sector len&ing7 -t
has to:
$a' Pro5i&e %or seasonalit6
$.' "llow repa6ment %le<i.ilit6
$c' Fi< a ceiling on loan si8es7
icro%inance approach is .ase& on certain pro5en truths which are not alwa6s recogni8e&7 +hese are:
17 +hat the poor are .an9a.le= success%ul initiati5es in micro %inance &emonstrate that there nee&
not .e a tra&eo%% .etween reaching the poor an& pro%ita.ilit6 - micro %inance constitutes a
statement that the .orrowers are not >wea9er sections? in nee& o% charit6, .ut can .e treate& as
responsi.le people on .usiness terms %or mutual pro%it 7
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
@7 +hat almost all poor househol&s nee& to sa5e, ha5e the inherent capacit6 to sa5e small amounts
regularl6 an& are willing to sa5e pro5i&e& the6 are moti5ate& an& %acilitate& to &o so7
A7 +hat eas6 access to cre&it is more important than cheap su.si&i8e& cre&it which in5ol5es length6
.ureaucratic proce&ures - $some institutions in -n&ia are alrea&6 len&ing to groups or SHGs at
higher rates - this ma6 pre5ent the groups %rom en;o6ing a su%%icient margin an& rapi&l6
accumulating their own %un&s, .ut mem.ers continue to .orrow at these high rates, e5en those
who can .orrow in&i5i&uall6 %rom .an9s'7
B7 CPeer pressureC in groups helps in impro5ing reco5eries7
O/j'()i0' O. Th' S)*-1
+his paper o.;ecti5e to clari%6 these issues within the conte<t o% the &e.ate a.out gen&er
ainstreaming7 +he paper is .ase& on research con&ucte& .6 5arious authors an& secon&ar6 source
material7
Mi(r,.inan(' S'(),r In In-ia
History and $.ol*tion
+he e5olution o% -n&ian F can .e .roa&l6 &i5i&e& into %our &istinct phases:
Phase ): The cooperati.e 'o.e'ent /)011-)0213
During this phase, cre&it cooperati5es were 5ehicles to e<ten& su.si&i8e& cre&it to 5illages un&er
go5ernment sponsorship7
Phase +: S*4sidi5ed social 4an6ing /)021s 7 )001
With %ailure o% cooperati5es, Go5ernment %ocuse& on measures such as nationali8ation o% !an9s,
e<pansion o% rural .ranch networ9s, esta.lishment o% Regional Rural !an9s $RR!s' an& the setting up
o% ape< institutions such as the *ational !an9 %or "griculture an& Rural De5elopment $*"!"RD' an&
the Small Scale -n&ustries De5elopment !an9 o% -n&ia $S-D!-', inclu&ing initiation o% a go5ernment
sponsore& -ntegrate& Rural De5elopment Programme $-RDP'7 While these steps le& to reaching a large
population, the perio& was characteri8e& .6 large scale misuse o% cre&it, creating a negati5e perception
a.out the cre&i.ilit6 o% micro .orrowers among .an9ers, thus %urther hin&ering access to .an9ing
ser5ices %or the low-income people7
Phase 8: SH#-Ban6 lin6age progra' and gro9th o, "#O-M!&s /)001 7 +1113
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
+he %ailure o% su.si&i8e& social .an9ing triggere& a para&igm shi%t in &eli5er6 o% rural cre&it with
*"!"RD initiating the Sel% Help Group $SHG' !an9 )in9age Programme $S!)P', aiming to lin9
in%ormal womenCs groups to %ormal .an9s7 +he program helpe& increase .an9ing s6stem outreach to
otherwise unreache& people an& initiate a change in the .an9?s outloo9 towar&s low-income %amilies
%rom >.ene%iciaries? to >customers?7 +his perio& was thus mar9e& .6 the e<tension o% cre&it at mar9et
rates7 +he mo&el generate& a lot o% interest among newl6 emerging icro%inance -nstitutions $F-s',
largel6 o% non-pro%it origin, to colla.orate with *"!"RD un&er this program7 +he macroeconomic
crisis in the earl6 1332s that le& to intro&uction o% the Economic Re%orms o% 1331 resulte& in greater
autonom6 to the %inancial sector7 +his also le& to emergence o% new generation pri5ate sector .an9s that
woul& .ecome important pla6ers in the micro%inance sector a &eca&e later7
Phase :: Co''erciali5ation o, Micro,inance:
The ,irst decade o, the ne9 'illenni*' Post re%orms, r ural mar9ets emerge& as the new growth
&ri5ers %or F-s an& .an9s, the latter ta9ing interest in the sector not onl6 as part o% their corporate
social responsi.ilit6 .ut also as a new .usiness line7 On the &eman& si&e, *GO-F-s increasingl6 .egan
trans%orming themsel5es into more regulate& legal entities such as *!FCs to attract commercial
in5estment7 F-s set up a%ter @222 saw themsel5es less in the &e5elopmental moul& an& more as
.usinesses in the %inancial ser5ices space, catering to an untappe& mar9et segment while creating 5alue
%or their sharehol&ers7 +his o5erri&ing shi%t .rought a.out changes in institutionsC legal %orms, capital
structures, sources o% %un&s, growth strategies an& strategic alliances7
Mi(r,-Finan(' An- W,m'n2s Em!,3'rm'n)
Th'r' ar' .,*r /asi( 0i'3s ,n )h' "in4 /')3''n mi(r,-.inan(' an- 3,m'n2s
'm!,3'rm'n):
1. +here are those who stress the positi5e e5i&ence an& are essentiall6 optimistic a.out the
possi.ilit6 o% sustaina.le micro-%inance programmes worl&-wi&e empowering women=
2. "nother school o% thought recogni8es the limitations to empowerment, .ut e<plains those with
poor programme &esign=
3. Others recogni8e the limitations o% micro-%inance %or promoting empowerment, .ut see it as a
9e6 ingre&ient as important in themsel5es within a strateg6 to alle5iate po5ert6= empowerment in
this 5iew nee&s to .e a&&resse& .6 other means=
4. +hen there are those who see micro-%inance programmes as a waste o% resources7
Un-'r"1ing Ar' Thr'' 5Para-igms6 On Mi(r,-Finan(' An- G'n-'r&
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
A+ Finan(ia" S'".-S*s)aina/i"i)1 Para-igm:
currentl6 &ominant within most &onor agencies an& in the mo&els o% micro-%inance promote& in
pu.lications .6 DS"-D, Worl& !an9, D*DP, CG"P an& the icro-cre&it Summit Campaign7 Here the
main consi&eration in programme &esign is pro5ision o% %inanciall6 sel%-sustaina.le micro-%inance
ser5ices to large num.ers o% poor people, particularl6 micro- an& small entrepreneurs7 +he %ocus is on
setting o% interest rate ErightF to co5er costs, to separate micro-%inance %rom other inter5entions to ena.le
separate accounting, to e<pan& programmes so as to capture economies o% scale, to use groups to
&ecrease costs o% &eli5er67 Gen&er lo..ies ha5e .een a.le to argue %or targeting women on the groun&s
o% high %emale repa6ment rates an& contri.ution o% women?s economic acti5it6 to economic growth7 -n
this para&igm, it is assume& that increasing women?s access to micro-%inance ser5ices will in itsel% lea&
to in&i5i&ual economic empowerment, well-.eing an& social an& political empowerment7
7+ P,0'r)1 A""'0ia)i,n Para-igm:
Dn&er lies po5ert6-targete& programmes7 Here the main Consi&erations are po5ert6 re&uction among the
poorest, increase& well-.eing an& communit6 &e5elopment7 +he %ocus is on small sa5ings an& loan
pro5ision %or consumption "n& pro&uction, group %ormation, etc7 +his para&igm ;usti%ies some le5el o%
su.si&6 %or Programmes wor9ing with particular client groups or in particular conte<ts7 Some
programmes ha5e &e5elope& e%%ecti5e metho&ologies %or po5ert6 targeting an&#or operating in remote
areas7 Gen&er lo..ies in this conte<t ha5e argue& %or targeting women, .ecauseo% higher le5els o% %emale
po5ert6 an& .ecause o% women?s responsi.ilit6 %or househol&well-.eing7 Po5ert6 alle5iation an&
women?s empowerment are seen as two si&es o% the same coin7 +he assumption is that increasing
women?s access to micro-%inance $together with other inter5entions to impro5e househol& well-.eing'
will in itsel% increase Househol& income which will then translate into impro5e& well-.eing %or women
an& Women to .ring a.out wi&er changes in gen&er ine:ualit67
C+ F'minis) Em!,3'rm'n) Para-igm:
un&erlies the gen&er policies o% man6 *GOs an& the perspecti5es o% some o% the consultants an&
researchers loo9ing at gen&er impact o% micro%inance programmes $eg Gohnson, 133/'7 +his para&igm
&i& not originate as a *orthern imposition7 -t is roote& in the &e5elopment o% some o% the earliest micro-
%inance programmes in the South, particularl6 SEW" an& WWF in -n&ia7 Here the un&erl6ing concerns
are gen&er e:ualit6B an& women?s human rights7 icro-%inance is promote& as an entr6 point in the
conte<t o% a wi&er strateg6 %or women?s economic an& socio-political empowerment7 +he %ocus here is
on gen&er awareness an& %eminist organi8ation7 Some programmes ha5e &e5elope& 5er6 e%%ecti5e means
%or integrating gen&er awareness into programmes an& %or organi8ing women an& men to challenge an&
change gen&er &iscrimination7 Some also ha5e legal rights support %or women an& engage in gen&er
a&5ocac67
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
Preference Employment & Business Sectors By Women
Entrepreneurs And Their Contribution In Economic Growth
Women .6 nature pre%era.l6 choose to wor9 in ser5ice sector li9e e&ucation, social ser5ices an&
househol& ser5ices such as &omestic wor97 !ut at the same time the start up moti5ations 5ar6 %rom
in&ustr6 to in&ustr67 !irle6, $1343'7
For a woman entrepreneurship is wa6 out o% economic &isparit6 an& towar& empowerment7 Her
entrepreneurship contri.utes positi5el6 in 5arious &imensions an& aspects in economic &e5elopment an&
;o. creation7 Gun&r6 an& welsch, $@221'7
Positi5e pro;ection o% entrepreneurial acti5it6 in a countr6 shoul& .e an integral element o% an6
go5ernment agenc6 in or&er to .oost economic prosperit6 which is su.se:uentl6 a wa6 out o% po5ert6 ,
economic crisis7
"&ult women representing a large group o% the o5erall population in each countr6 is a rea&il6 a5aila.le
pool o% potential entrepreneurs that can generate economic growth acti5it6 to impro5e their o5erall
economies7 Howe5er, the countries &o &i%%er in stages o% &e5elopment, &emographic patterns , &i%%erent
la.or con&itions7 Ste5enson, $134H'7
Women entrepreneurship is e<pan&ing aroun& the worl&7 Stu&ies ha5e shown that women owne&
.usinesses comprise .etween one-:uarter an& one-thir& o% .usinesses in the %ormal econom6 , are
li9el6 to pla6 an& e5en greater role in in%ormal sectors7 Gem report, $@22/'7
Role odelin! "pportunities
E<tensi5e role mo&eling opportunities nee& to .e intro&uce& to encourage an& gui&e women
entrepreneurs7 Women entrepreneur?s success stories can .e use& as a use%ul an& moti5ational resource
%or this purpose7 !owen, $134H'7 o&ern technological age has man6 such use%ul tools to promote such
role mo&eling programs li9e 5i&eo con%erencing, 5i&eos o% success%ul entrepreneur .6 ha5ing one to one
sessions with success%ul women entrepreneurs an& entrepreneurship as a 5i.rant metho& to o5ercome
economic &isparit67
Sma"" M'-i*m Si8' En)'r!ris' D'0'",!m'n) P"a).,rms
Entrepreneurship is now consi&ere& as the .ac9 .one o% economic &e5elopment which is ma;or
challenge glo.all6 %elt .6 e5en the &e5elope& nations to&a67 Such multi-&imensional plat%orms can ser5e
as %unctional plat%orms an& resource generation a5enues %or women entrepreneurs in their startup
.usiness phase7 Esta.lishment o% such plat%orms not onl6 ;ust encourage women entrepreneurs to enter
into .usiness 5entures .ut at the same time pro5i&e them a health6 learning an& training opportunities
%or their emotional an& social &e5elopment as well7 !runi, gherar&i an& poggio, $@22B'7 One such
5enture is the creation o% w.ic $women .usiness incu.ation center' as a su.-pro;ect o% sme&a pa9istan
with a close association with cham.er o% commerce an& in&ustr67
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
S,(ia" 'n)r'!r'n'*rshi! -'0'",!m'n)
Social entrepreneurship is another 5er6 5alua.le an& creati5e concept in entrepreneurship7 +he nee& %or
such social entrepreneurs is %elt glo.all6 more an& more with the perio& o% time7 Ri&ing, orser, .ar.ara
an& manle6, $@22H'7 Women nee& to .e encourage& to .ecome social entrepreneurs to e<ploit the
communit6 nee&s as their %uture .usiness 5entures7
Such social entrepreneurial opportunities are 5er6 much there in e5er6 communit6 an& especiall6 in
&e5eloping countries to o5ercome their &isparit6 an& po5ert6 issues7 )i9e clean water suppl6 to po5ert6
ri&&en areas, 5er6 competiti5e e&ucation &eli5er6 to chil&ren an& a&ults, cottage in&ustries in rural areas
%or women to manage their home e<penses, health incenti5es in rural areas etc7
S)*-1 On W,m'n Par)i(i!a)i,n In In-ia
C,m!ara)i0' S)*-1 ,. W,m'n W,r4 Par)i(i!a)i,n In In-ia
+he pro.lem o% &isparit6 .etween the women an& men in socio economic .eha5ior o% the societ6 an&
participation in emplo6ment are crucial issue in a &e5eloping countr6 li9e -n&ia7 -n a&&ition, one o% the
most conspicuous phenomena o% recent times has .een the increasing participation o% women in pai&
wor9 an& casual wor9 with &ecreasing participation in sel% emplo6ment wor9 $a8um&ar , *7, @211'
an& it has .een &ri5ing emplo6ment tren&s an& the gen&er gaps in pai& wor9 emplo6ment ha5e .een
shrin9ing7 +his section gi5es a &etail o% gap .etween men an& women on the .asis o% wor9 %orce
participation ratio an& la.our %orce participation ratio7 Chart 1 shows change in the %emale wor9%orce
participation in -n&ia7 +he chart clearl6 shows that e<cept @222-20 an& 1344-3B $e<cept there was %all in
rural %emale wor9%orce on principal status' %emale wor9%orce participation rate $WPR' has &ecrease& in
-n&ia7 -t has &ecrease& 5er6 sharpl6 .etween @220-24 an& @220-127+he chart in&icates the .urning %act
that emplo6ment opportunities %or the %emale has &ecrease& in -n&ia7 Rural %emale ha5e .een a%%ecte&
more than ur.an %emales in -n&ia7 +he gap .etween male an& %emale wor9%orce has &ecrease& till @22B-
20 .ut it has increase& in @220-@212 in rural an& ur.an -n&ia7 +he &i%%erences .etween the &ail6 status
an& usual status WPR were larger %or %emales than %or males7 +he tren&s in ur.an areas are also similar,
.ut the gap .etween the male an& %emale WPR is higher than that in rural areas7
Chart )
Chang' in F'ma"' 3,r4 F,r(' Par)i(i!a)i,n Ra)' in In-ia
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
+a.le 1 -t gi5es a &etail o% la.our %orce participation rate %or &i%%erent age-wise7 +a.le 1 an& chat @
shows that e<cept ur.an male at the age group o% 00-03 la.our %orce participation rate at all the age
group in .oth se<es has re&uce& .etween @22B-@220 an& @223-@2127 !ut when we see the se< wise
&ecline in )PWR, it is 5er6 high in %emale comparison to male7 +he &ecline in )PWR is 5er6 high in the
age group @2-B0 $which is signi%icant part o% the wor9ing age'7 De%initel6 present concerns suggest that
economic growth has %aile& to generate su%%icient emplo6ment an& &ecline in ;o. Opportunities seems to
.e 5er6 high %or %emale in -n&ia7
T a 4 l e )
Ag'-S!'(i.i( La/,*r Par)i(i!a)i,n Ra)' in In-ia a((,r-ing ), *s*a" s)a)*s
9!rin(i!a" an- s*/si-iar1 s)a)*s: 9in ; ag' <-<=:

+11:-1; +110-+1)1
Age R*ral
Male
R*ral
!e'ale
<r4an
Male
<r4an
!e'ale
R*ral
Male
R*ral
!e'ale
<r4an
Male
<r4an
!e'ale
);-)0 ;+=0 88=) 8>=) ):=: 80=1 )0=; +2=8 >=;
+1-+: >0=) :8=; ?2=0 +;=1 >)=8 8)=: 2>=+ )0=?
+;-+0 0>=+ ;8=1 0;=? +2=) 0?=; :1=; 0:=? ++=+
81-8: 0>=> ;0=8 0>=? 81=> 00=1 :8=: 0>=; +8=0
8;-80 00=) 2:=+= 0>=: 8:=1 00=+ :0=? 00=) +?=>
:1-:: 0>=; 2+=? 0>=8 8)=? 00=: :0=> 0>=? +;=2
)
@ata is gi.en in appendiA ta4le )=
+
The decline in the !PR ,or 9o'en, irrespecti.e o, age, 'ight 4e 4eca*se o, a decline in o.erall
e'ploy'ent opport*nities / Cho9dh*ry, +1))3=
Ta4l e +
P'r('n)ag' ,. P,!*"a)i,n in )h' La/,*r-F,r(' 9in !'r('n)ag' .,r ag' <-<=:
Year
R*ral &ndia <r4an &ndia All &ndia
Male !e'ale Male !e'ale Male !e'ale
)0>8 0)=) :;=) >>=2 +8 01=; :1
)008-0: 0+ ;8=) >+=: ++=; 01=+ :2=;
)000-11 >? :;=+ >+=: ++=; >;=2 8>=0
+11:-1; >2 ::=? >+=? +:=8 >;=; 8>=2
+110-)1B ??=> +;=2 ?2 )?=> ??=8 +8=:
S,*r(': 7ha""a & >a*r+ ? Da)a ha0' /''n )a4'n .r,m NSS @@
)h
r,*n- r'!,r)
N,)': : La/,*r .,r(' r'.'rs ), )h' <-<= ag' gr,*! )ha) r'!,r)s )ha) )h'1 ar' 3,r4ing+ ,r ",,4ing
.,r 3,r4 a((,r-ing ), )h' 23''4"1 s)a)*s2 -'.ini)i,n ,. 'm!",1m'n)&
+a.le @ shows percentage o% population $age 10-03' engage& in la.our %orce in all -n&ia as well as ur.an
an& rural area %rom 134A to @223-@2127 +he chart A re5els little &i%%erent %act the gen&er gap in la.our
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
%orce participation has &ecrease& in ur.an %emale since 134A .ut the gap has increase& in rural an& at all
-n&ia le5el in -n&ia since 133A-3B7 +his &epicts that men contri.ute more wor9 in comparison to women
an& the Chart B shows that the percentage o% women population in la.our %orce ten& to &ecline in rural
area in all the perio& e<cept .etween 134A-3B7 +his is interesting, that &uring the perio& o% li.erali8ation
an& regulari8ation o% econom6 it has .een assume& that the women will come more %reel6 an& in huge
num.er to la.our mar9et7 On the other han&, in ur.an area, the percentage o% %emale la.our %orce has
&ecline& in all perio& e<cept @222-207 +his picture clear that in ur.an area where %emale are more
literate, s9ille&#traine& the share o% %emale la.our %orce in total population is high while it has re&uce&
signi%icantl6 in @220-127 +he anal6sis clearl6 in&icate that &e%initel6 ur.an %emale are more e&ucate&
an& well traine&, so their position in ;o. mar9et has impro5e& .ut on the other it has not resulte& in
terms o% huge emplo6ment %or the %emale in -n&ia7

Mi(r, Finan(' Ins)r*m'n) F,r W,m'n6s Em!,3'rm'n)
icro Finance is emerging as a power%ul instrument %or po5ert6 alle5iation in the new econom67 -n
-n&ia, micro %inance scene is &ominate& .6 Sel% Help Groups $SHGs' I !an9 )in9age Programme,
aime& at pro5i&ing a cost e%%ecti5e mechanism %or pro5i&ing %inancial ser5ices to the Eunreache& poorF7
!ase& on the philosoph6 o% peer pressure an& group sa5ings as collateral su.stitute , the SHG
programme has .een success%ul in not onl6 in meeting peculiar nee&s o% the rural poor, .ut also in
strengthening collecti5e sel%-help capacities o% the poor at the local le5el, lea&ing to their empowerment7
icro Finance %or the poor an& women has recei5e& e<tensi5e recognition as a strateg6 %or po5ert6
re&uction an& %or economic empowerment7 -ncreasingl6 in the last %i5e 6ears , there is :uestioning o%
whether micro cre&it is most e%%ecti5e approach to economic empowerment o% poorest an&, among them,
women in particular7 De5elopment practitioners in -n&ia an& &e5eloping countries o%ten argue that the
e<aggerate& %ocus on micro %inance as a solution %or the poor has le& to neglect .6 the state an& pu.lic
institutions in a&&ressing emplo6ment an& li5elihoo& nee&s o% the poor7
Cre&it %or empowerment is a.out organi8ing people, particularl6 aroun& cre&it an& .uil&ing capacities to
manage mone67 +he %ocus is on getting the poor to mo.ili8e their own %un&s, .uil&ing their capacities
an& empowering them to le5erage e<ternal cre&it7 Perception women is that learning to manage mone6
an& rotate %un&s .uil&s women?s capacities an& con%i&ence to inter5ene in local go5ernance .e6on& the
limite& goals o% ensuring access to cre&it7 Further, it com.ines the goals o% %inancial sustaina.ilit6 with
that o% creating communit6 owne& institutions7
!e%ore 1332?s, cre&it schemes %or rural women were almost negligi.le7 +he concept o% women?s cre&it
was .orn on the insistence .6 women oriente& stu&ies that highlighte& the &iscrimination an& struggle o%
women in ha5ing the access o% cre&it7 Howe5er, there is a percepti.le gap in %inancing genuine cre&it
nee&s o% the poor especiall6 women in the rural sector7
+here are certain misconception a.out the poor people that the6 nee& loan at su.si&i8e& rate o% interest
on so%t terms, the6 lac9 e&ucation, s9ill, capacit6 to sa5e, cre&it worthiness an& there%ore are not
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
.an9a.le7 *e5ertheless, the e<perience o% se5eral SHGs re5eal that rural poor are actuall6 e%%icient
managers o% cre&it an& %inance7 "5aila.ilit6 o% timel6 an& a&e:uate cre&it is essential %or them to
un&erta9e an6 economic acti5it6 rather than cre&it su.si&67
+he Go5ernment measures ha5e attempte& to help the poor .6 implementing &i%%erent po5ert6
alle5iation programmes .ut with little success7 Since most o% them are target .ase& in5ol5ing length6
proce&ures %or loan &is.ursement, high transaction costs, an& lac9 o% super5ision an& monitoring7 Since
the cre&it re:uirements o% the rural poor cannot .e a&opte& on pro;ect len&ing app roach as it is in the
case o% organi8e& sector, there emerge& the nee& %or an in%ormal cre&it suppl6 through SHGs7 +he rural
poor with the assistance %rom *GOs ha5e &emonstrate& their potential %or sel% help to secure economic
an& %inancial strength7 Jarious case stu&ies show that there is a positi5e correlation .etween cre&it
a5aila.ilit6 an& women?s empowerment7
Pr,/"'m An- Cha""'ng's
Sur5e6s ha5e shown that man6 elements contri.ute to ma9e it more Di%%icult %or women empowerment
through micro .usinesses7 +hese elements are:
)ac9 o% 9nowle&ge o% the mar9et an& potential pro%ita.ilit6, thus
a9ing the choice o% .usiness &i%%icult7
-na&e:uate .oo9-9eeping7
Emplo6ment o% too man6 relati5es which increases social pressure to share .ene%its7
Setting prices ar.itraril67
)ac9 o% capital7
High interest rates7
-n5entor6 an& in%lation accounting is ne5er un&erta9en7
Cre&it policies that can gra&uall6 ruin their .usiness $man6 customers cannot pa6 cash= on the
other han&, suppliers are 5er6 harsh towar&s women'
Other Shortco'ings &ncl*des,
17 !ur&en o% meeting: +ime consuming meetings, in particular in programmes .ase& on group
len&ing, an& time consuming income generating acti5ities without re&uction o% tra&itional
responsi.ilities increase women?s wor9 an& time .ur&en7
@7 *ew Pressures: !6 using social capital, in-group len&ing#group collateral programmes,
a&&itional stresses an& pressures are intro&uce&, which might increase 5ulnera.ilit6 an& re%lect
&isempowerment7
A7 Rein%orcement o% tra&itional gen&er roles : lac9 o% economic empowerment: icro %inance
assists women to per%orm tra&itional roles .etter an& women thus remain trappe& in low pro&ucti5it6
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
sectors, not mo5ing %rom the group o% sur5i5al enterprises to micro-enterprises7+here are e5i&ence o%
men with&rawing their contri.utions to certain t6pes o% househol& e<pen&itures7
Cha""'nging S('nari, E(,n,mi( Em!,3'rm'n)
Howe5er impact on incomes is wi&el6 5aria.le7 Stu&ies which consi&er income le5els %in& that %or the
ma;orit6 o% .orrowers income increases are small, an& in some cases negati5e7 "ll the e5i&ence suggests
that most women in5est in e<isting acti5ities which are low pro%it an& insecure an&#or in their hus.an&?s
acti5ities7 -n man6 programmes an& conte<ts it is onl6 in a minorit6 o% cases that women can &e5elop
lucrati5e acti5ities o% their own through cre&it an& sa5ings alone7
-t is clear that women?s choices a.out acti5it6 an& their a.ilit6 to increase incomes are seriousl6
constraine& .6 gen&er ine:ualities in access to other resources %or in5estment, responsi.ilit6 %or
househol& su.sistence e<pen&iture, lac9 o% time .ecause o% unpai& &omestic wor9 an& low le5els o%
mo.ilit6, constraints on se<ualit6 an& se<ual 5iolence which limit access to mar9ets in man6 cultures7
+hese gen&er constraints are in a&&ition to mar9et constraints on e<pansion o% the in%ormal sector an&
resource an& s9ill constraints on the a.ilit6 o% poor men as well as women to mo5e up %rom sur5i5al
acti5ities to e<pan&ing .usinesses7 +here are signs, particularl6 in some ur.an mar9ets li9e Harare an&
)usa9a that the rapi& e<pansion o% micro-%inance programmes ma6 .e contri.uting to mar9et saturation
in >%emale? acti5ities an& hence &eclining pro%its7
C,n("*si,n
Entrepreneurship is presentl6 the most &iscusse& an& encourage& concept all o5er the worl& to o5ercome
economic challenges7 Women .eing the 5ital gen&er o% the o5erall population ha5e great capacit6 an&
potential to .e the contri.utor in the o5erall economic &e5elopment o% an6 nation7 +here%ore, programs
an& policies nee& to .e customi8e& to not ;ust encourage entrepreneurship as well as implement
strategies which can help support entrepreneurial culture among 6outh7
De5eloping countries are &e%initel6 in &ire nee& to encourage women entrepreneurship as women
wor9%orce is promptl6 a5aila.le to e<ploit the une<plore& &imensions o% .usiness 5entures7 De5elope&
nations shoul& primaril6 %ocus on entrepreneurial e&ucational programs in or&er to &e5elop women
entrepreneurs7
e&ia has the potential to pla6 the most 5ital role in entrepreneurial &e5elopment .6 creating an&
highlighting all such plat%orms which can .ring out the creati5it6 an& inno5ation among the women an&
men to grow entrepreneurship culture in societ67
Generall6 spea9ing, glo.all6 .usiness worl& has reali8e& an& is wor9ing on war %ooting to create
entrepreneurship as the %inal reme&6 to o5ercome all t6pes o% .usiness an& mar9et challenges7

Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T
R'.'r'n('s
17 Gun&r67 )797, .en-6oseph7 7, , posig7 7 $@22@'7 Econtemporar6 perspecti5es on womens
entrepreneurship: a re5iew , strategic recommen&ationF7 Gournal o% enterprising culture7 Jol712, no71 $pp7 H/-
4H'7
@7 Goheer, n7 $@22@', Ewomen entrepreneurs in pa9istan: a stu&6 to un&erstan& an& impro5e their .argaining
powerF, ilo, gene5a7
A7 !rau, G7 C7, , Woller, G7 7 $@22B'7 icro%inance: " Comprehensi5e Re5iew o% theE<isting )iterature7
/ournal of 0ntrepreneurial $inance and 'usiness 1entures, ($1',1-@H7
B7 Procee&ings o% @n& -nternational Con%erence on !usiness anagement, uhamma&, a7 R7 $@220'7 Ewomen
entrepreneurs in pa9istan: pro%ile, challenges an& practical recommen&ations7
07 Status o% women entrepreneurship in rural in&ia, "sian research ;ournals7 or&uch, G7 $@222', E+he
icro%inance SchismF, Worl& De5elopment, Jol7 @4, *o7 B, pp7 H1/-@3
H7 7(R"D" $@22@', !mpact of 2elf 3elp -roups #-roup 4rocesses% on the 2ocial5 0mpowerment2tatus of
Women Members in 2outhern !ndia,
/7 icrocre&it -nno5ations Department,*ational !an9 %or "griculture an& Rural De5elopment, um.ai7
47 -CRO E*+ERPR-SE DEJE)OPE*+ "*D RDR") WOE* E*+REPRE*EDRSH-P: W"( FOR
ECO*O-C EPOWERE*+
Mr& Rashmi Ranjan Panigrahi+ L'()*r'r in Finan(', ARYA SCHOO O! MA"A#$M$"T % &T