Financial institutions in India were so far more focussed on providing group based microcredit. But the need of the poor for quality market-led financial products does not end here. Poor need a range of financial products and not just microcredit. Considering this fact financial inclusion has become a part of the mandate of Indian government system. This makes micro savings an often-discussed topic now-a-days among financial institutions and development practitioners.
It is a common misconception that micro savings is not possible in India because of the strict regulatory rules. There are several ways in which saving options are available in India. These can be categorised into two major categories.
The less regulated informal sector that comprises of SHG’s, cooperatives and chit funds, etc., and
The regulated formal sector and this includes banks, regional rural banks, postal services, etc.
Informal sector presents some challenges and have their own strengths. This note attempts to provide a brief profile, of some of the micro savings options provided by informal and community-based/owned methods.
