Micro Credit Innovations Department
1.  Genesis
The key objective of the Micro Credit Innovations Department has been to facilitate sustained access to financial services for the unreached segments of the population viz. the poor in rural hinterlands, through various products and delivery channels in a cost effective and sustainable manner. The department came into being in the year 1998 with the mainstreaming of the microfinance innovation viz. SHG-Bank linkage programme to a nation-wide scale. NABARD, through the department of ‘Micro Credit Innovations’, has continued its role as the facilitator and mentor of microfinance initiatives in the country. 
2.  Core Functions of the Department
NABARD has been continuously focusing on bringing in various stakeholders on a common platform and building their capacities to take the initiatives forward. This has resulted in tremendous growth of microfinance sector in India through different approaches like:
A.    Promotion of Self Help Group – Bank Linkage Programme (SHG-BLP) 
Based on the observations of various research studies and an action research project carried out by NABARD, the model of ‘SHG-BLP’ was evolved as a cost effective mechanism for providing financial services to the unreached and underserved poor households. What started as a pilot to link around 500 SHGs of poor to the formal financial institutions during the year 1992-93, has now become the largest microfinance programme in the world, in terms of the client base and outreach. 
The NGO sector has played a prominent role of working as a Self Help Group Promoting Institution (SHPI) by organizing, nurturing and enabling credit linkage of SHGs with banks. NABARD later co-opted many others as SHPIs including the rural financial institutions (RRBs, DCCBs, PACS, Farmers’ Clubs (FCs), SHG Federations, NGO-MFIs, Individual Rural Volunteers (IRVs) etc.
These stakeholders were encouraged to take up promotion of SHGs by way of promotional grant assistance from NABARD. This savings-led microfinance model has now become the largest coordinated financial inclusion programme in the world covering almost 106 million households in the country. With more than 85% of the groups being exclusively women groups, the programme has provided a much needed push to women empowerment in the country.  Current status as on 31 March 2018 is given in the end.
B. WSHG scheme of GOI    
NABARD is implementing and supporting the Women SHG scheme (WSHGs) announced by Govt. of India in backward and Left Wing extremism affected districts through NGOs. NGOs play role in promotion and credit linkage of WSHGs with banks.
C.  Promotion of Joint Liability Groups (JLGs) and their financing by banks
JLGs are essentially credit groups of small/marginal/tenant farmers/asset less poor who do not have proper title of their farmland. These informal groups of 4-10 members are engaged in similar economic activities and are willing to jointly undertake to repay the loans taken by them from the Banks. Financing of JLGs was introduced as a pilot project in 2004-05 by NABARD in 8 States with the support of 13 RRBs. The scheme was later mainstreamed for the banking system in the year 2006.
Apart from extending refinance support of 100% to the financing Banks, NABARD also extends financial support for awareness creation and capacity building of all stakeholders under the Scheme. NABARD also extends start up grant support for formation and nurturing of JLGs to Banks and other JLG Promoting Institutions (JLGPIs).
D. Digitisation of SHGs- EShakti 
'The department has initiated a pilot project EShakti to digitize the books of accounts and other records at SHG level and make available updated records in digital form to banks aiding the the ease of doing business with SHG. After launching pilot in 2 district, the project EShakti has been expanded to 100 districts of the country by 31 March 2018. Details of the achievement can be accessed from the project website 
3. Others Initiatives
  • Livelihood promotion: To enable the SHG members to take up livelihood activities, NABARD has been supporting Micro Enterprise Development Programmes (MEDPs) and Livelihood and Enterprise Development Programmes (LEDPs) by involving NGOs and other suitable institutions.
  • Publications: The department brings out various publications relating to SHG- Bank linkage and other microfinance activities on a regular basis. Status of Microfinance in India is one of the most important annual publication, which is used as reference source by research scholars, policy planners, Govt. departments etc.
  • Interest Subvention: Administration of Interest Subvention Scheme for Women SHGs under National Rural Livelihoods Mission (NRLM) of Ministry of Rural Development 
  • Support for training and capacity building of personnel of partner agencies such as banks, NGOs, Govt. departments and other institutions
  • Extending support to NGOs and other institutions for formation and credit linkage of SHGs and JLGs with banks.
  • Supporting and sponsoring training and capacity building programmes, seminars and workshops for the benefit of all stakeholders viz. the bankers, govt. agencies, NGO partners and more importantly the SHG members.
Achievements of SHG-Bank Linkage Programme – 2017-18
Sr. No. Particulars Achievements


(No. in lakh)
(Rs. in crore)
1 Total number of SHGS saving linked with banks 87.44 19592
(i) Out of total SHGs – exclusive Women SHGs 73.90 17498
(ii) Out of total SHGs – under NRLM/SGSY 41.84 10434
(iii) Out of total SHGs – under NULM/SJSRY 4.25 1351
2 Total number of SHGs credit linked during 2016-17 22.61 47186
(i) Out of total SHGs – exclusive Women SHGs 20.75 44559
(ii) Out of total SHGs – under NRLM/SGSY 12.70 25055
(iii) Out of total SHGs – under NULM/SJSRY 1.06 2424
Total number of SHGs having loans outstanding as on 31 March 2017
50.20 75598
(i) Out of total SHGs - exclusive Women SHGs 45.49 70402
(ii) Out of total SHGs - under NRLM/SGSY 27.93 38225
(iii) Out of total SHGs - under NULM/SJSRY 2.90 5351
Data on Joint Liability Groups

(i) Cumulative JLGs promoted as on 31 March 2017 34.73
(ii) Cumulative loan disbursed to JLGs as on 31 March 2017

Contact Information

Shri Arun K Shukla
Chief General Manager
4th Floor, 'D' Wing
C-24, 'G' Block
Bandra-Kurla Complex, Bandra (East)
Mumbai 400 051
Phone No. : 02226530084
Fax No. : 02226528141