In 1970, Ilaben Bhat, founder member of ‘SEWA’(Self Employed Women’s Association) in Ahmadabad, had developed a concept of ‘women and micro-finance’. The Annapurna Mahila Mandal’ in Maharashtra. ‘Working Women’s Forum’ in Tamilnadu. Since 1987 ‘Mysore Resettlement and Development Agency’ (MYRADA) has promoted Credit Management Groups (CMGs). CMGs are similar to self-help groups. In 1991-92 NABARD started promoting self-help groups on a large scale. And it was the real take-off point for the ‘SHG movement’. In 1993, the Reserve Bank of India also allowed SHGs to open saving accounts in banks.
Why SHGs….? More than 27% of rural population lives below poverty line. Most of them have no access to banking system. Formal credit system not able to reach unreached. Gender issues needed to be addressed.
SHG’s Group (SHG) is a A Self-Help registered or unregistered group of micro entrepreneurs having homogenous social and economic backgrounds, voluntarily coming together to save regular small sums of money, equally agreeing to contribute to a common fund and to meet their emergency needs on the basis of joint help.
BASIC FEATURES OF SHG Small- homogenous group of 10-20 peoples. Registered or unregistered. Has a code of conduct rules and regulations for effective administration. Maintenance of simple books. Participatory Decision making Process. Mobilises Local Resources through regular savings. Plans own Programme with own Resources.
PRINCIPLES OF SHG 1. Interaction / Meetings / Reflection / Analysis and Action. 2. Regular Savings. 3. Trust in one’s self and among members in the group. 5. Records. 6. Access to Funds. 7. Team management of Resources.
Objective of SHG’s * Sustainable access to financial services * Stronger livelihood support systems * Enhancement of collective bargaining power * Self reliance and sense of dignity * Improvement in overall standard of living and empowerment
SHG model in India In India three different models of linkage of SHGs to the financial institutions have emerged. They are: Banks, themselves, form and finance the SHGs. SHGs are formed by NGOs and other agencies but financed by banks. Banks finance SHGs with NGOs and other agencies as financial intermediaries. The second model is the most popular model. Almost three-fourths of all the SHGs come under this model. Only 20% of the SHGs are covered under the first and 8% under the third model respectively.
SHG BANK LINKAGE MODEL FORMING AND NURTURING SAVINGS SHGBANK CREDIT LINKED TO SAVINGS MEMBERS 11
SHG BANK LINKAGE MODEL NGO, GO, Federation FORMING, of SHGs DEVELOPING MONITORINGBANK CREDIT LINKED TO SAVINGS SHG SAVINGS MEMBERS 12
SHG BANK LINKAGE MODELS NGO, Federation FORMING,COMMON of SHGs PROMOTING,CREDIT MONITORING CREDIT SAVINGS BANK ? SHG SAVINGS ? MEMBERS 13
Indian scenario India has adopted the Bangladesh’s model in a modified form. To improve the poverty and to empower the women, the micro-finance has emerged as a powerful instrument. With availability of micro-finance, self-help groups (SHGs) and credit management groups have also started in India. And thus the movement of SHG has increase out in India.
The movement of SHG was nourished in the states of Gujarat, Maharashtra, Andhra Pradesh, Rajasthan, Tamilnadu and Kerala. Now many banks are provide help like - NABARD Bank of Maharashtra State Bank of India Cooperative Banks Regional rural banks The Government institutions like Maharashtra Arthik Vikas Mahamandal (MAVIM) District Rural Development Agency (DRDA) Municipal corporations & also 3,024 NGOs are collectively and actively involved in the promotion of SHG movement.
Number of new SHGs financed by banks during last five years Chart Title600,000 5,39,365500,000400,000 361,731300,000 255,882200,000 197,653 149,050100,000 0 1 2 3 4 5 6
Success State Nos. in Lakh Andhra Pradesh = 48.5 Tamil Nadu = 12.5 Uttar Pradesh = 6.6 Orissa = 4.1 Maharashtra = 3.9
BALSRIGITTIM WOMEN’S SELF-HELP GROUPUNDER SAMANDA DEVELOPMENT BLOCK, EAST GAROHILLS, MEGHALAYA
Advantages of SHGs1.To the group: Access to large resources Up gradation in skill and technology Exposure2.To the bank: Externalization of work Reduction in transaction cost Better margin Wider coverage Larger smaller savings Improvement in general credit
Conclusion: If we join our hands together to support SHGs we will start talking about rural prosperity instead of rural poverty. …………..