While several micro finance models have evolved subsequently across the globe, the search for delivering financial inclusion to the rural households and hinterlands, has evolved through two distinct approaches for developing a micro finance model in India, first – the bank led approach mainly through Self Help Group (SHG) – Bank Linkage Programme (SHG-BLP), and the second one through the specialised micro finance institutions led model.
The recognition of and emphasis on micro finance at a larger scale and beginnings of a formalised structure of micro finance in India can be traced back to the SHG – bank linkage programme (SBLP) which was started as a pilot project in 1992 by National Bank for Agricultural and Rural Development (NABARD). This programme proved to be quite successful over the years.