If I am not wrong then India has the largest number of poor people in the world (nearly 30% of the population live in extreme poverty). Every year, many poor people commit suicide because of extreme poverty. Often they take their own precious lives because of failing to pay a very small amount of loan. In fact, a loan of $100 or $200 in easy terms can save many families in India. That is why, I feel very happy to see that mainstream banks are getting interested to give loan to the poor people. Some of the major local and foreign banks are now seriously entering into this field. They have basically two motivations:
- The market is very big.
- The banks can have a better image as a socially committed company to their share holders.
Of course, a bank is a commercial entity and every book wants to make profit. So, India banks are no exception either. ABN Amro, Standard Chartered, HSBC, Citigroup, State Bank of India, UTI banks and even ICICI Bank- all these banks now think that microfinance may just be the next biggest thing in Indian banking sector.
What do you think?
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