Microfinance: The Relevance and Uniqueness of Annapurna Pariwar

This chapter covers a brief history of microfinance in the country; the self-help groups (SHG) movement over three decades, capturing the key factors that contributed to the success of the SHG movement and the missing services, the emergence of lending by NGOs, the key factors that made NGOs lenders and their pros and cons, the conversion to for-profit NBFCs, growth, greed for return on capital, and crises, RBI and Government action, and community-owned financial institutions and their relevance. In Section B, Annapurna Pariwar (AP) as a community-owned financial institution is explained. The research questions addressed in this chapter are: What was the intention of initiating the organisation? The positioning of AP as a member-owned institution. Which organisational form was chosen and why? What factors guided the governance and management structure? What are the key elements in organisational visioning to ensure double-bottom growth (financial and social)? Did it remain member-centric? What were the challenges, and how were they faced? Meeting microfinance standards—which metrics were measured in terms of governance, management, HR, products and services, and portfolio quality. With a plethora of financial institutions and many choices available now—what percentage of members still continue and why? Did AP re-invent itself to meet competition, changes in the external environment, and changes in the demographics of members? Who are the major partners contributing to the growth of AP, and how did they align with the intent of AP? Why is Annapurna Mahila Mandal (AMM) still relevant today? What do members appreciate about AMM? What are the core factors that will keep AMM relevant for another 20 years?