Centre for Micro Finance (CMF) IFMR Research - Chennai

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Centre for Micro Finance (CMF) IFMR Research -
Chennai
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Centre for Microfinance

• The Centre for Micro Finance (CMF) is a
  non-profit, non-partisan research centre housed
  within the Institute for Financial Management and
  Research in Chennai.
• The mission of the Centre for Micro Finance
  is to improve the accessibility and quality of
  financial services for the poor through rigorous
  research, knowledge dissemination, and
  evidence-based policy outreach.

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Organizations Approach

• Develops research ideas and research design to
  conduct studies using rigorous methodology.
• - Impact Evaluation using RCTs
• - Short-term Policy Research
• - Panel Studies
• - Short-term research like a snapshot/
  case-study
• Partners with key stakeholders in an effort to
  translate research/ evidence based results into
  Policy and Practice.
• - Disseminating results through various
  publications and
  
• in person meetings with key
  stakeholders
• - Conducting conferences and Round-table
  discussions
• Conducts trainings and workshops for students and
  practitioners on research tools and methodology.

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Partners

• CMF engages with a wide variety of institutions
  to carry out its mission
• Implementation Partners AIC, Bandhan,
  Hand-in-Hand, KGFS, Mann Deshi, Saath, SEWA,
  Sonata, Spandana, and several others.
• Policy Research Partners BIRD-NABARD, Ministry
  of Finance, CAB-RBI
• Institutional Research Partners Harvard, MIT,
  IIM(C), Yale, IPA, J-PAL, RAND, Wharton,
  Stanford, World Bank
• Principle Investigators Abhijit Banerjee, Esther
  Duflo, Rohini Pande, Erica Field, Shawn Cole,
  Jeremy Tobacman, Karna Basu, Santosh Anagol
• Principle Funders Ford Foundation, 3ie, National
  Science Foundation, Gates Foundation, USAID,
  AUSAID, DFID, World Bank, LSE, MIT

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Areas of Research

• CMF undertakes quantitative and qualitative
  research in 4 broad areas. 25 projects at
  various stages of development are currently under
  way across the country. These areas are
• Financial Inclusion
• Livelihoods
• Social Objectives
• Regulation and Policy
• WWW.CENTRE-FOR-MICROFINANCE.ORG/RESEARCH-PROJECTS

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Research Methodology?
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Methodology for Impact Studies

1. Estimate the Sample size
2. Identify the Sample
3. Conduct Baseline
4. Randomize
5. Provide Intervention
6. Observe
7. Conduct Endline
8. Analyze

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Examples of Impact Studies

• Impact Evaluation of the self help group (SHG)
  model
• Impact Evaluation of KGFS Rural Bank model
• Value of Distributing Treated Bed Nets via
  microfinance
• Health Insurance Combined with Micro-credit
• Impact Evaluation of Rural Micro-credit and
  women's empowerment
• Avaaj Otalo Investigating the impact of a
  mobile-based Agricultural Extension Service

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Examples of Short Term Policy Research

• Understanding the uptake and willingness to pay
  for a bundled Social Security Product (Study with
  Ministry of Finance-GoI and GIZ)
• Evaluation of Pudhu Vaazhvu (Skills Training
  Programme) of Government of Tamil Nadu
• Mapping the performance of Livelihood Promotion
  Groups in the states of Madhya Pradesh, Rajasthan
  and Tamil Nadu (World Bank and FAO)
• Understanding the Financial Viability of Business
  Correspondence Model and Clients Perspective.
  (BIRD-NABARD)
• Analysis of the Performance of No-Frills Accounts
  (CAB-RBI)

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Case of Financial Literacy
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Push of Financial Inclusion
Particulars Year ended Mar 10 Year ended Mar 12 Progress-April 10 - Mar 12
No. of BCs/BC Agents Deployed 33042 96828 63786
Banking Outlets through Branches 21475 24701 3226
Banking Outlets through BCs 32684 120355 87671
Banking Outlets-Through other Modes 99 2478 2379
Total Banking Outlets 54258 147534 93276
No Frill A/Cs (No. in Millions) 49.33 103.21 53.88
Overdraft- No Frill A/Cs (No. in Millions) 0.13 1.52 1.39
BC- ICT Based A/Cs (No. in Millions) 12.54 52.07 39.53
EBT A/Cs-through BCs (No. in Millions) 7.48 21.76 14.28
KCC(No. in Millions) 17.63 22.34 4.71
GCC(No. in Millions) .45 1.27 .82
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Other Initiatives

• Moving towards technology
• Intermediate Brick and Mortar banking structures
• Satellite offices in the form of
• ultra small BC outlets
• Promoting Financial
• Literacy

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Barriers to Financial Inclusion

• Access related like Distance, Documentation etc.
• Low Literacy Levels
• Lower comprehension of complex financial
  landscape
• Inadequate trust on products and services
• Fear from technology

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Role of Financial Literacy

• Establishing need
• Creating awareness and reducing information
  asymmetry
• Building trust
• Improvise decision making process

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Centres Role in Studying Financial Literacy

• RCTs (Experimental)
• -Impact Evaluation of Savings Training on
  Microcredit Clients in Rural India
• -The effect of financial literacy training on
  personal financial decision making
• Non-Experimental
• -Impact of Financial Literacy when imparted to
  BC clients
• Qualitative
• -Evaluation of Financial Literacy Training
  Programmes in India

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Results so far..

• Knowledge and awareness (about savings and
  insurance) of people increases but behavioural
  impact has not been witnessed
• Demand driven recorded messages had good take up
  among farmers
• Reinforcing using Individual Counselling helps as
  people question their decision making
• Trainees perceive a higher level of comprehension
  of financial concepts
• One size fits all principle should not be used
• Teachable moments need to be exploited

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Results so far.. (Contd..)

• Usage of no-frills savings account by the
  treatment group significantly increases in the
  post intervention period
• Pensions and Insurance, the topics of prime
  importance, are not focused upon
• It is believed that complementing financial
  literacy with some livelihood programme would
  increase the take up and influence of the former
• List of all the best practices, innovative ways
  (like setting up a financial literacy hub, use of
  recorded messages, daily tricks to save) and
  relevant suggestions have been documented

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Results so far.. (Contd..)

• Illiterate people might not possess good numeracy
  skills but they are good with money
• Complexity spoils it all
• Trust increases the up-take

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Scope of Collaboration with XIMB

• Academia
• -Partners in Policy Based Action Research on
  Livelihood in Chhattisgarh, Bihar and Tamil
  Nadu
• -Principle Investigators on experimental and
  non-experimental studies of CMF
• Curriculum
• -Contribute in designing development related
  course curriculum
• -Share case studies on livelihoods to be used in
  the courses
• Students
• -Recruitment of potential Research Associates
• -Providing training/ guest lectures in research
  tools statistical package (STATA)

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Thank you