Microfinance institutions (MFIs) are working hard on bringing the balance between the authoritarianism and capitalism, by creating opportunities in the market, says Sudhir Sinha, Chief Executive Officer, Uttar Pradesh Microfinance Association.
In a recent interview, former RBI (Reserve Bank of India) governor Raghuram Rajan, had said that the capitalism is under serious threat because it is not providing equal opportunities. This will lead to authoritarian regimes, which arises when you socialise all the means of production. A balance is needed, you can’t pick and choose – what you need to do is improve the opportunity.
Taking a cue from his interview, Sinha said, that the microfinance institutions are trying their best to maintain this balance by creating more opportunities.
“At present we are catering to around six million clientele in the country, with around 6,000 crore of trade counting. This figure is significant because it shows that we are making efforts in order to reduce unemployment,” Sinha said.
Currently the organisation is supported by SIDBI (Small Industries Development Bank of India) and NABARD (National Bank for Agriculture and Rural Development), which is providing us lot of equity. So there are several opportunities in this sector and we are also looking forward to tie-up with some more entities, he said.
I would like to thank Elets Technomedia and other state associations of MFIs for working with us in creating opportunities, he added.
This will eventually lead to the balance between the capitalism and authoritarianism, Sinha said.
Microfinance sector was created to open access to capital for individuals previously shut out from financial services. In its direct contact with the poor, they represent a new way for financial capital to potentially stimulate economic growth in developing countries.