A recent article from LiveMint.com highlighted the results of ‘State of the Sector 2009,’ a study of 230 microfinance institutions (MFIs) in India performed by ACCESS Development Services, “a not-for-profit organization that offers consulting services to MFIs” [1,2,3]. According to the report, “one out of three microfinance institutions (MFI) in India made losses in fiscal 2009,” which ended on March 31, 2009 [1]. Additionally, 42 percent of MFIs with a loan portfolio at or below INR 5 crore, the equivalent of over USD 1 million, reported losses in the same fiscal year [1]. On the other hand, 80 percent of MFIs with a loan portfolio above INR 50 crore, the equivalent of over USD 10.7 million, were profitable [1]. The article cites operating costs for smaller MFIs, which can be as high as 60 percent of total costs, as an explanation [1]. In terms of repayment, the report claims that the MFIs in the study recovered 99 percent of loans [1]. Overall, the MFIs in the study nearly doubled their loan portfolio in fiscal year 2009, reaching INR 11,734 crore, the equivalent of over USD 2.5 billion, and added 8.5 million borrowers, resulting in a total of 22.6 million borrowers [1].
By Christopher Maggio, Research Assistant
About:
ACCESS Development Services
Description:
ACCESS Development Services, which is based in India, is “a not-for-profit organization that offers consulting services to microfinance institutions (MFIs)” through various means. It offers capacity building and technical services on topics such as operational organization, portfolio management, and financial management. It also works to facilitate funding to 130 member MFIs through the ACCESS Microfinance Alliance (AmFA). Lastly, it organizes the Microfinance India Summit annually in order to provide “the microfinance community the opportunity to meet and learn from each other, participate in discussions and debates on key issues and be exposed to the international experiences and innovations.” ACCESS Development Services was founded in 2006.
ACCESS Development Services does not report to the MIX Market, the microfinance information clearinghouse.
Organization’s Website:
http://www.accessdev.org/index.php
Contact:
Head Office
New Delhi
28 Hauz Khas Village
1st floor
New Delhi-110 016
Tel +91 1126510915
Fax +91 26850821
Additional Resources:
Live Mint article entitled ‘Size does matter when it comes to microfinance’: http://www.livemint.com/2009/12/10210535/Size-does-matter-when-it-comes.html
State of the Sector 2009 Power Point: www.microfinanceindia.org/download_reports/N_Srinivasan.ppt
Bibliography:
[1] Live Mint article entitled ‘Size does matter when it comes to microfinance’: http://www.livemint.com/2009/12/10210535/Size-does-matter-when-it-comes.html
[2] ACCESS Development Services: http://www.accessdev.org/
[3] State of the Sector 2009 Power Point: www.microfinanceindia.org/download_reports/N_Srinivasan.ppt
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