Gramya Shakti

Gramya Shakti (Strengthening Community Based Federations in Orissa)
A joint initiative of ACCESS and Rabobank Foundation

The microfinance market in the state of Orissa has shown good potential in terms of growth and outreach. The advent of Mission Shakti, initiated by the Women and Child Development Department, Govt. of Orissa in 2001, has provided a further boost to the microfinance movement boasting of approximately 3,22,000 SHGs in the state.  As a promoting agency, Mission Shakti holds the largest stake in the SHG movement with 68% of SHG formation from the basket of all the Govt. agencies put together.

The present challenge is to build quality and standards, greater financial deepening, sustainability and encourage market-led micro-enterprises. While SHGs are recognised for financial intermediation and linkages, SHGs federations registered under the Mutually Aided Cooperative Societies (MACS) act are yet to get due recognition by the FFIs, which show some apprehension about the structure and functioning of the federations (absence of any established systems, procedures, basic management practices including MIS and governance).

Key Issues and Challenges encountered by the clusters and federations in Orissa:

  • Most of the Federations in Orissa whether promoted by Govt. agencies or NGOs are owned, controlled and managed by the promoting agencies.
  • Experience of weak governance with limited knowledge in microfinance operation
  • Federations, except those promoted by the district Administration in Ganjam, are not recognised as financial intermediaries by the financial institutions.
  • Except the CARE-ACCESS supported federations, almost all others lack computerised MIS.
  • Lack of scale or critical mass of client base has eroded the potential of their financial viability in most cases.
  • Federations are yet to be rated by any accredited rating agencies.

Gramya Shakti: The Project

The proposed project “Gramya Shakti” entails Shakti (power) of the Gramya (Rural Women) by accessing to need based financial services by strengthening 10 to 12 COMFIs registered under the Orissa Self Help Cooperative Act in the state.

Project Duration : Three Years

Role of ACCESS

  • Establishing a Gramya Shakti Resource Centre for Federation Building in the state.
  • Institutional Capacity Assessment / Partner selection; Identification and MOU with partners; Providing fund support to partners
  • Baseline for each federation will be established so that both qualitative and quantitative progress can be measured.
  • Development of Business plan for three years in each federation
  • Capacity Building of staff and Federation; streamlining the system and procedures in each Federation
  • Strengthening Governance and internalisation of organisational Vision and Mission
  • Tie-up with financial market in order to bridge the gap between credit demand and supply.
  • Convergence with Govt. schemes & programs.
  • MICRO SCAN of all the partner federations will be prepared every semester and disseminated to all key stakeholders for better leveraging.
  • Developing a robust withdrawal strategy.