Microfinance services in India are delivered through many channels: self-help and joint liability groups, banks, non-banking financial companies, cooperatives, and post offices. Cooperatives had lost ground but the introduction of new laws allows self-financed cooperatives to operate free of government interference. Using this law, self-help promoting institutions (SHPIs) have federated self-help groups (SHGs) into self-reliant cooperatives. This paper uses a case study of cooperatives in Karnataka State, India, to consider questions about enabling and limiting factors in promoting self-reliant cooperatives. The lessons show that when financial and managerial sustainability is achieved, member-owned institutions give the best financial returns to members from microfinance operations, besides giving decision-making power, and improving the positioning of women-owned organizations vis-à-vis formal financial institutions. Setting up governance and financial systems can, however, be constrained by low incomes and low literacy of members, and attitudes and rules of government and banks.

Chidambaranathan, M. (2012) Study on Status of SHGs and their Institutions in Karnataka, Report, Bangalore: Sampark.

De Crombrugghe, A. (2005) ‘The savings-credit cooperatives in Peru and Ecuador and the development of rural finance services’, Zoom microfinance No. 17, Luxembourg: SOS Faim and Microfinance <www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf

Deepika, M.G. and Sigi, M.D. (2011) Financial Inclusion, Empowerment and Poverty Alleviation: An Alternative State-led Microfinance and Microenterprise Model of Kudumbashree in India, Working Paper No. 113/2011, Coimbatore: Amrita School of Business <http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf≯ [accessed 22 May 2013]. http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf

Duursma, M. (2004) Community-based Microfinance Models in East Africa, The Hague, Netherlands and Tanzania: HIVOS, SNV-Tanzania, FACET BV <www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf

Gaboury, A. and Quirion, M. (2006) Why We Can No Longer Afford to Ignore Financial Cooperatives in the Effort to Increase Access to Financial Services, Quebec, Canada: Development International Desjardins.

Kumar, S. (2010) Study on SHG Federations: Challenges & Opportunities, Center for Microfinance Research, Lucknow: Bankers Institute of Rural Development.

Premchander, S., Prameela, V., Chidambaranathan, M. and Jeyaseelan, L. (2009) Multiple Meanings of Money: How Women See Microfinance, New Delhi: Sage Publications.

Puhazhendi, V. (2013) Microfinance State of the Sector Report, Delhi: Sage Publications.

Rajagopalan, S., Krishnagopal, G.V., Madhumurthy, N. Sarat Kumar, G.V., Madhusudana Rao, V., Banikya, P. and Switha Grandhi, V. (2011) Status of Self-Reliant Cooperatives: A Study in Furtherance of the Resurgence of a Vibrant Cooperative Movement Across India, Hyderabad: Access Livelihoods Consulting India.

Regulagedda, R. (2009) An Overview of MFOs in India: Consolidated result of 786 MFO Profiles, New Delhi and Mumbai: GTZ, Rural Financial Institutions Programme and NABARD.

Ritchie, A. (2007) Community-based Financial Organisations: A Solution to Access in Remote Rural Areas? Discussion Paper 34, Washington, DC: International Bank for Reconstruction and Development/World Bank.

Sa-Dhan (2008) The DAKSHIN Bharat Microfinance Report: Quick Data 2008 for Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, New Delhi: Sa-Dhan.

Srinivasan, G. and Tankha, A. (2010) SHG Federations: Development Costs and Sustainability, New Delhi: Access Development Services.

Tankha, A. (2012) Banking on Self-help Groups: Twenty Years On, New Delhi: Sage Publications and Access Development Services.

Chidambaranathan, M. (2012) Study on Status of SHGs and their Institutions in Karnataka, Report, Bangalore: Sampark.

De Crombrugghe, A. (2005) ‘The savings-credit cooperatives in Peru and Ecuador and the development of rural finance services’, Zoom microfinance No. 17, Luxembourg: SOS Faim and Microfinance <www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf

Deepika, M.G. and Sigi, M.D. (2011) Financial Inclusion, Empowerment and Poverty Alleviation: An Alternative State-led Microfinance and Microenterprise Model of Kudumbashree in India, Working Paper No. 113/2011, Coimbatore: Amrita School of Business <http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf≯ [accessed 22 May 2013]. http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf

Duursma, M. (2004) Community-based Microfinance Models in East Africa, The Hague, Netherlands and Tanzania: HIVOS, SNV-Tanzania, FACET BV <www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf

Gaboury, A. and Quirion, M. (2006) Why We Can No Longer Afford to Ignore Financial Cooperatives in the Effort to Increase Access to Financial Services, Quebec, Canada: Development International Desjardins.

Kumar, S. (2010) Study on SHG Federations: Challenges & Opportunities, Center for Microfinance Research, Lucknow: Bankers Institute of Rural Development.

Premchander, S., Prameela, V., Chidambaranathan, M. and Jeyaseelan, L. (2009) Multiple Meanings of Money: How Women See Microfinance, New Delhi: Sage Publications.

Puhazhendi, V. (2013) Microfinance State of the Sector Report, Delhi: Sage Publications.

Rajagopalan, S., Krishnagopal, G.V., Madhumurthy, N. Sarat Kumar, G.V., Madhusudana Rao, V., Banikya, P. and Switha Grandhi, V. (2011) Status of Self-Reliant Cooperatives: A Study in Furtherance of the Resurgence of a Vibrant Cooperative Movement Across India, Hyderabad: Access Livelihoods Consulting India.

Regulagedda, R. (2009) An Overview of MFOs in India: Consolidated result of 786 MFO Profiles, New Delhi and Mumbai: GTZ, Rural Financial Institutions Programme and NABARD.

Ritchie, A. (2007) Community-based Financial Organisations: A Solution to Access in Remote Rural Areas? Discussion Paper 34, Washington, DC: International Bank for Reconstruction and Development/World Bank.

Sa-Dhan (2008) The DAKSHIN Bharat Microfinance Report: Quick Data 2008 for Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, New Delhi: Sa-Dhan.

Srinivasan, G. and Tankha, A. (2010) SHG Federations: Development Costs and Sustainability, New Delhi: Access Development Services.

Tankha, A. (2012) Banking on Self-help Groups: Twenty Years On, New Delhi: Sage Publications and Access Development Services.

Chidambaranathan, M. (2012) Study on Status of SHGs and their Institutions in Karnataka, Report, Bangalore: Sampark.

De Crombrugghe, A. (2005) ‘The savings-credit cooperatives in Peru and Ecuador and the development of rural finance services’, Zoom microfinance No. 17, Luxembourg: SOS Faim and Microfinance <www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf

Deepika, M.G. and Sigi, M.D. (2011) Financial Inclusion, Empowerment and Poverty Alleviation: An Alternative State-led Microfinance and Microenterprise Model of Kudumbashree in India, Working Paper No. 113/2011, Coimbatore: Amrita School of Business <http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf≯ [accessed 22 May 2013]. http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf

Duursma, M. (2004) Community-based Microfinance Models in East Africa, The Hague, Netherlands and Tanzania: HIVOS, SNV-Tanzania, FACET BV <www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf

Gaboury, A. and Quirion, M. (2006) Why We Can No Longer Afford to Ignore Financial Cooperatives in the Effort to Increase Access to Financial Services, Quebec, Canada: Development International Desjardins.

Kumar, S. (2010) Study on SHG Federations: Challenges & Opportunities, Center for Microfinance Research, Lucknow: Bankers Institute of Rural Development.

Premchander, S., Prameela, V., Chidambaranathan, M. and Jeyaseelan, L. (2009) Multiple Meanings of Money: How Women See Microfinance, New Delhi: Sage Publications.

Puhazhendi, V. (2013) Microfinance State of the Sector Report, Delhi: Sage Publications.

Rajagopalan, S., Krishnagopal, G.V., Madhumurthy, N. Sarat Kumar, G.V., Madhusudana Rao, V., Banikya, P. and Switha Grandhi, V. (2011) Status of Self-Reliant Cooperatives: A Study in Furtherance of the Resurgence of a Vibrant Cooperative Movement Across India, Hyderabad: Access Livelihoods Consulting India.

Regulagedda, R. (2009) An Overview of MFOs in India: Consolidated result of 786 MFO Profiles, New Delhi and Mumbai: GTZ, Rural Financial Institutions Programme and NABARD.

Ritchie, A. (2007) Community-based Financial Organisations: A Solution to Access in Remote Rural Areas? Discussion Paper 34, Washington, DC: International Bank for Reconstruction and Development/World Bank.

Sa-Dhan (2008) The DAKSHIN Bharat Microfinance Report: Quick Data 2008 for Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, New Delhi: Sa-Dhan.

Srinivasan, G. and Tankha, A. (2010) SHG Federations: Development Costs and Sustainability, New Delhi: Access Development Services.

Tankha, A. (2012) Banking on Self-help Groups: Twenty Years On, New Delhi: Sage Publications and Access Development Services.

Chidambaranathan, M. (2012) Study on Status of SHGs and their Institutions in Karnataka, Report, Bangalore: Sampark.

De Crombrugghe, A. (2005) ‘The savings-credit cooperatives in Peru and Ecuador and the development of rural finance services’, Zoom microfinance No. 17, Luxembourg: SOS Faim and Microfinance <www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1158235147131_ Zoom17_EN_PRINT.pdf

Deepika, M.G. and Sigi, M.D. (2011) Financial Inclusion, Empowerment and Poverty Alleviation: An Alternative State-led Microfinance and Microenterprise Model of Kudumbashree in India, Working Paper No. 113/2011, Coimbatore: Amrita School of Business <http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf≯ [accessed 22 May 2013]. http://amrita.edu/asb/pdfs/workingpaper/Working-Paper-No.113.pdf

Duursma, M. (2004) Community-based Microfinance Models in East Africa, The Hague, Netherlands and Tanzania: HIVOS, SNV-Tanzania, FACET BV <www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf≯ [accessed 22 May 2013]. www.ruralfinance.org/fileadmin/templates/rflc/documents/1132305871234_Community_Based_Microfinance_Models_in_East_Africa.pdf

Gaboury, A. and Quirion, M. (2006) Why We Can No Longer Afford to Ignore Financial Cooperatives in the Effort to Increase Access to Financial Services, Quebec, Canada: Development International Desjardins.

Kumar, S. (2010) Study on SHG Federations: Challenges & Opportunities, Center for Microfinance Research, Lucknow: Bankers Institute of Rural Development.

Premchander, S., Prameela, V., Chidambaranathan, M. and Jeyaseelan, L. (2009) Multiple Meanings of Money: How Women See Microfinance, New Delhi: Sage Publications.

Puhazhendi, V. (2013) Microfinance State of the Sector Report, Delhi: Sage Publications.

Rajagopalan, S., Krishnagopal, G.V., Madhumurthy, N. Sarat Kumar, G.V., Madhusudana Rao, V., Banikya, P. and Switha Grandhi, V. (2011) Status of Self-Reliant Cooperatives: A Study in Furtherance of the Resurgence of a Vibrant Cooperative Movement Across India, Hyderabad: Access Livelihoods Consulting India.

Regulagedda, R. (2009) An Overview of MFOs in India: Consolidated result of 786 MFO Profiles, New Delhi and Mumbai: GTZ, Rural Financial Institutions Programme and NABARD.

Ritchie, A. (2007) Community-based Financial Organisations: A Solution to Access in Remote Rural Areas? Discussion Paper 34, Washington, DC: International Bank for Reconstruction and Development/World Bank.

Sa-Dhan (2008) The DAKSHIN Bharat Microfinance Report: Quick Data 2008 for Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, New Delhi: Sa-Dhan.

Srinivasan, G. and Tankha, A. (2010) SHG Federations: Development Costs and Sustainability, New Delhi: Access Development Services.

Tankha, A. (2012) Banking on Self-help Groups: Twenty Years On, New Delhi: Sage Publications and Access Development Services.