Abstract
In the preceding chapter, the strategies used by the efficient and sustainable Indian Microfinance Institutions (MFIs), to manage the determinant and discriminant factors of their sustainability are documented. This documentation is expected to serve as a reference for other relatively less efficient Indian MFIs to understand how their efficient and sustainable counterparts are managing sustainability. Though this knowledge is important for them to improve sustainability, it is also pertinent for MFIs to understand the dangers that are imminent, if they mismanage the sustenance factors. Mismanagement occurs if MFIs become overly conscious of sustainability, oblivious of its impact on client welfare. By referring to Indian microfinance crisis and the literature associated with it, the author portrays such mismanagement issues and the adverse affects it can have on microfinance clients. This discussion ends by reminding the MFI players of an old tenet that governs the sector: sustainability is only a means to achieve the goal of poverty alleviation, and not an end in itself.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsNotes
- 1.
In our discussions in Chap. 6 we have seen that the borrower to credit officer ratio crossing 550 can result in downside portfolio risks
References
Bamzai (2010) We’ve never been accused of abetting suicides. Business Today
Banerjee A, Bardhan P, Duflo E, Field E, Karlan D, Khwaja A, Mookherjee D, Pande R, Rajan R (2010) Help microfinance, don’t kill it. Indian Express
Consultative Group to Assist the Poor (CGAP) 2010 Indian microfinance goes public: the SKS initial public offering. http://www.microfinancegateway.org/gm/document-1.9.47761/FN65-1.pdf. Retrieved 25 Jan 2010
Guha, Marakkath (2013) Are microfinance services relevant for micro-entrepreneurial growth: a case based discussion from Indian microfinance models. Paper accepted for presentation at 4th international conference on Institutional and Technological Environment for Microfinance (ITEM4), Paris
Kumar V, Rozas D (2010) Exclusive: SKS microfinance journey to IPO—an inside story. microfinance focus. http://www.microfinancefocus.com/news/2010/05/17/exclusive-sks-microfinance-journey-to-ipo-an-insidestory/. Retrieved 25 Jan 2010
Malegam Committee Report (2011) Report of the Reserve Bank of India sub-committee of its central board of directors to study issues and concerns in the Micro Finance Institutions (MFI) sector. Reserve Bank of India. http://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=23780. Retrieved 25 Feb 2010
Nadiya M, Olivares-Polanco F, Radha Ramanan T (2012) Dangers in mismanaging the factors affecting the operational self-sustainability (OSS) of Indian microfinance institutions (MFIs) – an exploration into Indian microfinance crisis. Asian Econ Financ Rev 2(3):448–462 (Asian Economic and Social Society)
Prabhu G (2011) Publically held microfinance firms are a form of organized crime in emerging economies. Paper presented at academy of management meeting, cross divisional paper session of managing in emerging economy and multinational contexts, San Antonio
Rhyne E (1998) The Yin and Yang of microfinance: reaching the poor and sustainability. MicroBank Bull 2(1):6–8
Sinha S (2010) How to calm the charging bull: an agenda for CGAP in the decade of the Teneeis. Micro-Credit Rating International Limited, Gurgoan
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2014 Springer India
About this chapter
Cite this chapter
Marakkath, N. (2014). Qualitative Phase: Mismanagement of the Factors Affecting and Discriminating Sustainability—Learnings from Indian Microfinance Crisis. In: Sustainability of Indian Microfinance Institutions. India Studies in Business and Economics. Springer, New Delhi. https://doi.org/10.1007/978-81-322-1629-2_7
Download citation
DOI: https://doi.org/10.1007/978-81-322-1629-2_7
Published:
Publisher Name: Springer, New Delhi
Print ISBN: 978-81-322-1628-5
Online ISBN: 978-81-322-1629-2
eBook Packages: Business and EconomicsEconomics and Finance (R0)