S A Aiyar Sunday July 26, 2009 In his Budget speech, the FM hailed bank nationalization as visionary and revolutionary. Yet, nationalized banks have, by and large, not reached the poor. However, micro-finance is now reaching people whom nationalized banks could not.
Households getting micro-credit now outnumber poor households. Outstanding micro-finance loans total 80 million. Some borrowers have multiple loans, so net beneficiaries may total 60 million households. This is more than the 55 million poor households, and more than a quarter of India’s 220 million households.