Reliance Capital foray into microfinance

Reliance Capital is providing funding (I suppose loans) to MAS Financial Services and Vardan Trust, two microfinance institutions in India. Initially they have been given Rs. 5 crore and Rs. 40 lakh respectively. Reliance Capital is earmarking Rs. 100 crore for Microfinance initiatives.

Details from The Economic Times

The Independent: Microcredits go mobile in India...

I couldn't understand much from this article though.

But now hundreds of Indians have become attached to a mobile bank manager, which means they can be in direct contact with lenders. Using smart cards and handheld biometric fingerprint readers, Indian banks such as ICICI and Punjab National are now taking their services direct to India's 350 million once un-bankable people.

All I could locate from this article was the name of the company FINO, which must be this one. Should find out what they do.

New Yorker article: What Microloans Miss

Pretty much the usual criticism that what developing countries require is more job creation and not micro loans.

What poor countries need most, then, is not more microbusinesses. They need more small-to-medium-sized enterprises, the kind that are bigger than a fruit stand but smaller than a Fortune 1000 corporation. In high-income countries, these companies create more than sixty per cent of all jobs, but in the developing world they’re relatively rare, thanks to a lack of institutions able to provide them with the capital they need. It’s easy for really big companies in poor countries to tap the markets for funding, and now, because of microfinance, it’s possible for really small enterprises to get money, too. But the companies in between find it hard. It’s a phenomenon that has been dubbed the “missing middle.”