Microfinance has emerged as a transformative force in North India, playing a pivotal role in driving economic growth and alleviating poverty, experts said at a ‘Regional Conference on Advancing Financial Inclusion’ organised by Sa-Dhan in Chandigarh on Thursday.

Sa-Dhan, a collective of impact finance institutions including microfinance institutions (MFIs) and a self-regulatory organisation (SRO) for the microfinance sector.

Raghunath B, the chief general manager (CMD) of NABARD, Punjab, said microfinance has enabled countless individuals, particularly those from underserved and marginalised communities, to access small loans, savings, and insurance services that were previously out of reach. In Punjab, where agriculture forms the backbone of the economy, it has empowered smallholder farmers to invest in modern agricultural practices, acquire vital inputs, and expand their productivity.

Deepa Bordoloi Guha, CGM, NABARD, Haryana said the northern and northwestern parts of India represent the latest phase of microfinance development in the country and are still in their nascent stages. Remarkably, microfinance’s penetration in North India stands at a mere 8.24%, in contrast to the Eastern region’s 32.20% and the Southern region’s 27.87%.

Shrimati Jayashree Vyas, co-chair of Sa-Dhan and Managing Director of SEWA Bank, underscored the vital connection between empowering women and propelling economic growth. She stressed the importance of supporting women-led microenterprises and urged the microfinance sector to play an active role in facilitating this empowerment.

Amardeep Samra, MD Midland Microfin, said that microfinance institutions have fostered entrepreneurship by providing budding entrepreneurs with the capital needed to launch and sustain their ventures. This has not only spurred job creation but has also diversified the economic landscape. Beyond the economic impact, microfinance has contributed to social empowerment by promoting financial literacy and inclusion, empowering women to take charge of their financial destinies, and fostering community development initiatives. In essence, microfinance stands as a cornerstone in Punjab’s journey towards inclusive growth, propelling individuals and communities towards a brighter and more prosperous future.

The other speakers included Puskar Tarai, Hemant Tamta, RP Singh, Balbir Singh, Amitesh Kumar, Mohit Rana, Pramod Kumar Paliwal, Arpita Pal Agrawal, and Anil Dewani.