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    Icici Bank'S Innovations in Rural Finance

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    Ip Singh Khurana
    ICICI Bank is India's second largest bank with $22 billion in total assets. It has an explicit social commitment to enable the poor to become active participants in economic processes. It uses two main strategies for rural India - directly providing micro-loans through self-help groups, and indirectly through lending to microfinance institutions and partnering with rural kiosk networks. Self-help groups build skills and solidarity while gaining affordable access to credit, and partnerships with kiosks and MFIs expand access to financial services in rural areas.

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    Icici Bank'S Innovations in Rural Finance

    Uploaded by

    Ip Singh Khurana
    9 views6 pages
    ICICI Bank is India's second largest bank with $22 billion in total assets. It has an explicit social commitment to enable the poor to become active participants in economic processes. It uses two main strategies for rural India - directly providing micro-loans through self-help groups, and indirectly through lending to microfinance institutions and partnering with rural kiosk networks. Self-help groups build skills and solidarity while gaining affordable access to credit, and partnerships with kiosks and MFIs expand access to financial services in rural areas.

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    653_e_choupelICICI

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    ICICI Bank is India's second largest bank with $22 billion in total assets. It has an explicit social commitment to enable the poor to become active participants in economic processes. It uses two main strategies for rural India - directly providing micro-loans through self-help groups, and indirectly through lending to microfinance institutions and partnering with rural kiosk networks. Self-help groups build skills and solidarity while gaining affordable access to credit, and partnerships with kiosks and MFIs expand access to financial services in rural areas.

    Copyright:

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    9 views6 pages

    Icici Bank'S Innovations in Rural Finance

    Uploaded by

    Ip Singh Khurana
    ICICI Bank is India's second largest bank with $22 billion in total assets. It has an explicit social commitment to enable the poor to become active participants in economic processes. It uses two main strategies for rural India - directly providing micro-loans through self-help groups, and indirectly through lending to microfinance institutions and partnering with rural kiosk networks. Self-help groups build skills and solidarity while gaining affordable access to credit, and partnerships with kiosks and MFIs expand access to financial services in rural areas.

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    ICICI BANK’S

    INNOVATIONS
    IN RURAL FINANCE
    ICICI
    ICICI BANK
    BANK
     2nd largest bank in India
    total assets $22 billion
     Explicit social commitment
    enabling the poor to become active, informed
    participants in economic processes
     Universal, technology-driven bank
    over 1 million online customers
     Insistence on commercially viable model

    World Resources Institute


    Two
    Two Strategies
    Strategies for
    for Rural
    Rural India
    India
     Direct provider of financial services
    micro-loans via village self-help groups

     Indirect distribution channels


    lender to MFIs, sometimes an investor;
    partner with enterprises building Internet
    kiosk networks in rural areas

     New financial products for rural India


    rain insurance, crop futures derivatives

    World Resources Institute


    Self-help
    Self-help Groups
    Groups
     Each 20 women below poverty line
    training, regular monthly savings program;
    loans after 1 year: $250, 18% interest
     Social service consultants
    experienced local woman, form 20 new groups
     Coordinators
    oversee 6 consultants, 120 SHGs
     Bank project manager
    oversees coordinators, trains SHGs, reviews
    loan applications
    8000 SHGs, growing rapidly
    World Resources Institute
    Indirect
    Indirect Channels
    Channels
     Partnering with 4 of largest MFIs
    line of credit to cover 3 years cash flow
    some equity investments
     Partnering with rural kiosk networks
    training the operator as credit agent
    placing inexpensive ATM at kiosks
    savings, loans, other products
    providing loans for crop inputs via suppliers
     N-Logue, ITC e-choupal, EID Parry,
    BASIX

    World Resources Institute


    Development
    Development Benefits
    Benefits
     SHGs build self-confidence, group
    solidarity, governance skills, regular
    savings
     Some SHGs active in village politics
     Positive impact on income, communication
    skills, participation in household decision-
    making—decline in social problems
     Access to credit at affordable rates,
    growing trust in formal system

    World Resources Institute

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