Banking in Backward Regions: Banks-NGO-POOR Interface - Alternatives for Action

The problem of improving access of poor to formal banking system in risky ecological regions has acquired added importance in recent times. The ecological imbalances, reduced opportunities for productive investments, fluctuations in outputs, lack of technological break through, seasonal as well as permanent migration, poor infrastructure, multi-enterprise based household survival strategies etc. pose tremendous challenge to designers of accessible organizations. We have taken into account the spatial, seasonal, sectoral dimensions of social stratification while conceptualising the problems of access of poor to natural resources, assurance from the institution and abilities or the skills of the poor to convert access into investments. The socio-ecological paradigm so developed has been used to abstract lessons from six cases of Bank – NGO – Poor interface. While we do not believe that the challenge of developing poor in backward regions can be left primarily on the shoulders of NGOs, we do recognise the need for learning from innovative approaches. The experience of six cases studied by colleagues at IIM and GIAP has been synthesized in this paper. Several policy options identified earlier have been validated while need for some more has also become apparent. It is hoped that NABARD will be able to use insights emerging from this ongoing group research effort to make banking in backward region more accessible to poor.