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It has been felt for some time in India that the credit needs of poor women, particularly in the unorganised sector, have not been adequately addressed by the formal financial institutions in the country. The vast gap between demand for and supply of credit to this sector established the need for a National Credit Fund for Women.
The National Credit Fund for Women or the Rashtriya Mahila Kosh (RMK) was set up in March 1993 as an independent registered society by the Department of Women & Child Development in Government of India’s Ministry of Human Resource Development with an initial corpus of Rs. 310,000,000 - not to replace the banking sector but to fill the gap between what the banking sector offers and what the poor need. Its main objectives are :
- To provide or promote the provision of micro-credit to poor women for income generation activities or for asset creation.
- To adopt a quasi-informal delivery system, which is client friendly, uses simple and minimal procedures, disburses quickly and repeatedly, has flexibility of approach, links thrift and savings with credit and has low transaction costs both for the borrower and for the lender.
- To demonstrate and replicate participatory approaches in the organisation of women’s groups for thrift and savings and effective utilisation of credit.
- To use the group concept and the provision of credit as an instrument of women’s empowerment, socio-economic change and development.
- To cooperate with and secure the cooperation of the Government of India, State Governments, Union Territory administrations, credit institutions, industrial and commercial organisations, NGOs and others in promoting the objectives of the Kosh.
- To disseminate information and experience among all these above agencies in the Government and non-government sectors in the area of microfinance for poor women.
- To receive grants, donations, loans, etc., for the furtherance of the aims and objectives of the Kosh.
The office of the Kosh is situated in New Delhi. The Kosh does not have any branch offices. The Executive Director is the chief executive officer of the Kosh. The Executive Director functions under the overall supervision, direction and control of the Governing Board. The Governing Board comprises 16 members consisting of senior officers of the Government of India and State Governments, specialists and representatives of NGOs active in the field of microfinance for women. The Governing Board is chaired by the Minister in charge of the Department of Women & Child Development in the Government of India.The General Body of the Kosh consists of all members of the Board, institutional members and individual members.
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