Lessons from failures

My View on  "Banks can be happy small lenders": 

I join Mr Surnan in asking the author to check his figures right. Today the SHGs are gradually surfacing the NPA portfolio with a 7 percent of them notwithstanding huge sops like interest subventions and zero interest credit to them by States like Andhra Pradesh. The author may like to look at some of the initiatives of the CCD, Hyderabad chaired by Prof. Trilochan Sastry and the Access Livelihoods Consulting, Hyderabad who are promoting producer cooperatives and producer companies respectively. Their model envisages heavy pre-investment capacity building efforts of the farmers and women engaged in production of the commodities around which the primary organisations are created and later federated for gaining economies of scale and handholding until these organisations realize their goal of sustainability and self-governance. As long as organisations like BASIX, a long standing and one of the first few MFIs in the country under Mr Vijay Mahajan concentrated on livelihood promotion and pre-investment training it flourished and when finance and profit ruled over governance the organization went southwards nearing extinction. MFIs have to learn lessons from failures and concentrate on livelihood promotion as key to their success. 

- Yerram Raju