Diagnosing Financial Stress in Group Methodology

• by Venkat Attaluri, Suresh Krishna and Veena Yamini
• Apr 20, 2010
• 1 min
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This focus note presents the learning from a study conducted by MicroSave in collaboration with Grameen Koota to look at the group lending methodology.

The recent past has seen instances in the south of India where groups refuse en masse to repay, which has, unsurprisingly, challenged MFI operations. The reasons for this are many, including the competitive environment, multiple borrowing, the perceived threat from MFIs to the SHG movement and the increasing attention being focused on the sector. This focus note presents the learning from a study conducted by MicroSave in collaboration with Grameen Koota to look at the group lending methodology and assess the drivers of financial stress in the kendras, and if/how this can be diagnosed.