Microfinance: implications for natural resources
Student name: Mr Bhavook Bhardwaj
Guide: Mr Soumendu Sarkar
Year of completion: 2015
Host Organisation: Indian Institute of Technology, Roorkee
Supervisor (Host Organisation): Dr Subir Sen
Abstract: Credit market imperfections are widely observed. These imperfections have resulted in microfinance gaining prominence of late. Since the primary objective of Microfinance is poverty reduction, existing literature is more or less silent on the impact of microfinance on environment. Its presence has been highly concentrated in rural areas globally. Rural areas are characterized by another kind of poverty, namely energy poverty. Energy poverty and economic poverty are intricately related and the need for financing energy transitions is crucial. Government of India has been actively promoting renewable energy through subsidies and various support programs. This study analyses one such scheme: Prathama Jyoti microcredit scheme for solar energy. A sample of 80 households from three villages of Moradabad district in Uttar Pradesh has been collected to analyse the household and economic determinants of obtaining microcredit for solar energy. Interviews of NABARD, MNRE, Prathama bank officials and the energy service provider were conducted. The study shows the education level of household head to be a significant factor. Another major factor is the number of children in the household. Lower income households are more likely to avail solar microcredit. The findings suggest the scope of energy linked micro loans is immense in India and private players must enter this arena more actively
Keywords: Green Microfinance, Renewable Energy, Energy Poverty, Microcredit
