A number of schemes to alleviate poverty were introduced through the official development planning process. It was then thought that the poor has no capital and he needs money/credit to improve his conditions. Hence schemes with capital subsidy were introduced. The mainstream formal financing agencies are spatially and psychologically distant form the rural poor (especially the women). They do not appreciate the economic realities of the poor in different socio-cultural and livelihood processes. Thus, their standardized products, services and lending technologies are often inappropriate for the range, diversities and fluctuations of credit need of the poor. The experience of formal financing institutions of subsidy related programmes, with high transaction cost, poor recovery and shortage of manpower inhibited the Banks not going for such type of credit any further. Hence the emergence of SHGs to reduce the cost of transitions, numbers of accounts and improve the rate of recovery. But people’s  participation in various programmes, i.e. savings and thrift and credit habits were lacking. To improve the quality of life of the poor, State Govt., NABARD and NGOs in Orissa focused their attention in promoting Self Help Groups, with peoples participations, strengthening their capacity and also linking them to a wider network.

As response to the emerging socio, economic and legal requirements. CYSD (Centre for Youth and Social Development, Bhubaneswar), an NGO registered under Societies Registration Act 1860 is engaged in development of underprivileged and marginalized section of the society in various parts of Orissa in civil society building, providing basic services on education,cysd health and sanitation and improvement of individuals through self reliance for last 25 years. It was felt by the management that the peoples’ participation was lacking, skill development was not given proper thrust, the habit of thrift and credit did not improve in rural areas. Rigid rules of banks, process of documentation, terms and conditions, unfriendly products and technologies could not make the Banks client-friendly for the poor. CYSD started mobilising groups and helped them in mobilizing thrift and saving habits amongst them. But CYSD’s effort in this direction has been restricted in some locations in the State and the management decided to scale up the activities through out the State. But as an NGO, CYSD had certain limitations to carry out the desired activities. Hence, it was thought of establishing a separate outfit for micro finance activities. Then it facilitated formation of an MFI called “Swayamshree Micro Credit Services” – a not–for-profit Company. SMCS emerged for supplementing the efforts of existing players in the field of micro finance and help giving a boost to SHG movement in the State of Orissa. 

The Swayamshree Micro Credit Services (SMCS) is a leading Non-Government Development Financial Institution in the State of Orissa, registered under Section 25 of the Companies Act, 1956 in the year 2003 and incorporated as a not-for-profit Company under Section 25 of the Companies Act, 1956. The registered office of the Company is at E-1, Institutional Area, P.O.RRL, Bhubaneswar – 751013, Orissa, (India) With initial support from CYSD, the organisation has been set up at M-75, Samanta Vihar, Near Nalco Chhak, Bhubaneswar – 751017, Khurda, Orissa, (India).