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SDC sponsors institutional change (MICROCREDIT)

Indian President A.P.J. Abdul Kalam gave the bank an award for their services to the poor

(Keystone Archive)

The Nagarjuna Grameena Bank (NGB) directly benefited from a programme to improve institutional efficiency sponsored by the Swiss Agency for Development and Cooperation (SDC).

This project aimed to help the hundreds of rural financial institutions under the National Bank for Agriculture and Rural Development's (Nabard) wing, one of which was NGB.

Over five years, the Swiss provided SFr9.5 million ($7.34 million) or 40 per cent of the total cost of the programme. The rest was met by Nabard.

The project was so successful in shaking up NGB, and consequently helping it to make it easier for the rural poor to access financial services, that the bank's director received an award from the Indian President A. P. J. Abdul Kalam in 2004.

The sweeping changes included updating infrastructure, business methods and the introduction of new technology.

The results included increased staff motivation, organisational effectiveness and profits.

The Organisation Development Initiative (ODI) is a three-phase process.

Phase I involves facilitators meeting bank employees and trying to gauge the working atmosphere. They then draw up a framework, which is presented to the board.

Phase II and III involve reviews, which monitor the changes suggested.

NGB director Vadhavan told swissinfo that after the ODI took place, staff had a changed attitude to their jobs, going from being disinterested to taking pride in their work.

The ODI also heralded a technological revolution for the bank's branches in the districts of Khammam and Nalgonda.

During the financial year 2004-5, 40 were fully computerised. Another 60 will join them by the end of next year.

swissinfo, Faryal Mirza

Key facts

The Nagajuna Grameena Bank is classified as a Regional Rural Bank.
It covers the districts of Khammam and Nalgonda in the Indian state of Andhra Pradesh.
The bank's geographical reach is over an area of over 30,000 km2.

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