microfinance and self help group case study

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MICRO FINANCE THROUGH SELF HELP GROUPS -A SURVEY OF RECENT LITERATURE IN INDIA

In the development paradigm, micro-finance has evolved as a need-based programme for empowerment and alleviation of poverty to the so far neglected target groups (women, poor, deprived etc.) and micro-finance has become one of the most effective interventions for economic empowerment of the poor. The experience across India and other countries has shown a robust potential of Microfinance to integrate with the development issues thereby significantly impacting the lives of poor. This paper critically reviews the various empirical studies carried out in India and it will help the researchers in the field of SHG and microfinance. Though the literature available is fairly large, the review is limited to the 53 major studies carried out in India to identify the major trends. Studies carried out in India, as evident from this paper, indicates that micro finance and Self Help groups, by and large contributed to the development of core poor in terms of economic well being, alleviating poverty and empowerment leading to over all development of rural poor.

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IBMRD's Journal of Management & Research, 2016

Micro finance and micro credits are sometimes used interchangeably. However the term micro credit refers to the provision of the small amount of loan whereas the term microfinance has a broader meaning encompassing other financial services in its umbrella such as savings, insurance, etc. along with the provision of credit facilities. Rural India faces a serious problem of poverty. In order to reduce poverty in the rural India, an active participation of the government and non-government organization is required simultaneously on the two fronts, i.e., production and distribution of goods and services. Poverty is generally concentrated in that region where there is a huge problem of literacy and employment. In order to reduce this problem, the fifth five year plan has put an emphasis on employment generation in the rural and urban areas. Hence in order to achieve the goal of employment generation and poverty reduction in the rural area, micro finance has been introduced which provides credit, savings, insurance and other basic financial services within the reach of the common man. Recently, micro credit revolution in the form of self-help group (SHG) movement is gaining momentum among the people in the rural India. This research paper tries to determine various benefits that a rural India has obtained through the formulation of SHG and the impact of Microfinance on the savings, income and the financial positions of the members of the SHG. Paper also focuses on the empowerment of women and the resultant rural development as a result of the benefits from microfinance through SHG.

Journal of Rural and Development, 2012

This paper is an empirical study conducted in Nalbari district, Assam about the impact of micro-finance on poverty. It examines the nature of loans provided by the SHGs to its members, and finds that the amount of loans provided under the programme to its members is too small to help them cross the poverty line. Again these loans were utilised mainly for consumption purposes, followed by expenditure on current productive activities. Thus, there were only a few capital investments. But these capital investments were also not enough to provide the members full employment opportunity and sufficient income to cross the poverty line. Again it was seen that still the members of the SHGs go either to the moneylenders or to the banks for higher amount of loan. Moreover, it was found that a large segment of the SHGs are closed down. The closing of SHGs was found more in case of those formed under NABARD-sponsored SHG- Bank linkage programme and those formed under SGSY. Actually these SHGs we...

International Journal of Finance and Commerce, 2019

Women in both rural and urban areas face a higher risk of poverty and more limited economic opportunities. The number of rural women living in extreme poverty rose by about 50 percent over the past twenty years. World Data Lab anticipates the effects of these methodological adjustment will result in a level of extreme poverty in India today of 50 million people, which is expected to come down to 40 million (a poverty rate of below 3 percent) by end 2019. As per the latest Indian Human Development Survey released on May 11, 2019, the Indian households that have more than five children are severely deprived of shelter, water, sanitation, health and education as compare to 7.8 per cent of poor families without children. Under these circumstances, it has become essential to take some definite measures for new employment opportunities and to reduce poverty among rural women. Microfinancing through self help groups in India has been viewed as a development tool which would generate employment, remove inequality and enhance the growth of the country through financial services to the needy poor. Self help Groups provides training to the borrowers to increase their productivity, to increase their income and consumptions, which contribute to lowering vulnerability. This paper examines the role of micro finance through self help groups for the upliftment of social and economic condition of poor women in rural India.

Micro finance is a financial service of small quantities provided by financial institutions to the poor people. These services may include savings, credit, insurance, leasing, money transfer etc., that is any type of financial services, which are provided to customers to meet their financial needs. It was found that despite organized banking expansion in the rural areas, majority of poor people remained outside the fold of the formal banking system. Thus, began the search for an alternative delivery mechanism, which would cater the financial needs of the poor people especially the women members of such households. SHG is a group of 10-20 persons from homogenous class who come together for addressing the common problem. They collect voluntary savings on regular basis and utilize the pooled resources to make small interest bearing loans to their members. The paper examines the SHGs in three states of India-Bihar, U.P. and M.P. and the loans sanctioned to SHGs of these states by the banks. A comparative analysis is done of the rural female SHGs and the conclusions are drawn.

Microfinance in India presently is too small to create a great impact in poverty alleviation, but if provide new technologies with skills and opportunities for the development of the poor, it holds to change the socio economic face of the India's poor. The self-help group (SHG) model with bank lending to groups without collateral has become an established part of rural finance. SHG-based microfinance look after and supported by NGOs, have become an significant alternative to traditional lending in terms of reaching the poor without increase in operating and monitoring costs. The government and financial institution have accepted this and have highlighted the SHG model and take initiatives to work along with NGOs. Million of SHGs have been linked to banks over the years but still most of the states are not doing well to established the development process of the poor and also do not link up and nurtured the various schemes of the Govt. This paper throw light on women empowerment through Self Help Group and it also discuss the growth of SHG in India. The fact that almost half of our women are illiterate speaks of serious genderdiscrimination within the systemWomen's empowerment plays a very important role in the overalldevelopment of the country. It not only helps in the development of half of thehuman resources, but in improving the quality of life at home and outside.

International Journal of Advances in Engineering and Management (IJAEM), 2022

In many developing nations, particularly India, the SHG program is gaining recognition as an innovation in the field of rural lending to assist the rural poor in alleviating poverty and empowering women. It is seen as a route for reaching the underprivileged and neglected segments of society, who would not normally be able to obtain loans from banks. The primary purpose of SHG beneficiaries is to remove poverty from their roots, and it assists them in combating poverty since there is a need for adequate money to be available for rural people. Women's empowerment in India is still a work in progress. Currently, self-help groups are playing a significant role in this direction. Women's participation in these groups has a significant impact on increasing their quality of life as well as their social upliftment in society. The current study is descriptive in nature and critically evaluates numerous empirical studies conducted in the Uttarakhand state of India on SHGs and microfinance. According to the findings of this study, studies conducted in Uttarakhand show that microfinance and self-help groups, in general, contributed to the development of the core poor in terms of economic well-being, poverty alleviation, and empowerment, resulting in the overall development of the rural poor.

The Indian Economy Sixty Years After Independence, 2008

The present study assesses the benefits of microfinance through self-help groups, based on a specially designed survey in selected villages in Pune district. While the benefits in terms of higher income, consumption, and savings matter for the poor, the focus here is broader, as an attempt is made to also assess some key dimensions of women's empowerment-defined broadly as expansion of freedom of choice and action to shape their own lives. While the targeting of microfinance through SHGs was unsatisfactory in terms of an income criterion, it was better in terms of other indicators of deprivation such as low caste, landlessness and illiteracy. What is, however, noteworthy is that the loans were used largely for health and education of children and for production-related expenses-especially by the disadvantaged. Using different methods and data sources, various dimensions of empowerment were confirmed. Some of the mechanisms involved in it were identified and assessed. Not only do SHGs benefit from the presence of networks, the former also contribute to trust, reciprocity and associational capital (e.g. through strengthening of local institutions). Domestic violence was reduced. However, greater responsibilities for women also involved longer hours of work.

According to Milton Freedman, NobelLau rate, Poor stay poor, not because they are lazy but because theyhave no access to capital”. This statement is an enough argument to believe that poverty is the result of deficiency of capital and other factorshasleast,effects comparatively. Realizing this,a number of countries, theworld wide over initiatea number of policy measures and strategies. Some measures like advancement in education, extension in health services and infra-structurefacilities, suitable capacity building measures,etc. were expected to have telling effects on poverty. But the immediateeffect necessitatesthe implementation of income transfer programmes like food for worked, cash grants or the programmes which will enable them to get immediate income for livelihoodas well as sustainable income in future. The former will not help much to avoid poverty of the beneficiaries on long term basis than meeting immediate requirements, but the later is not easy to identify,not is it so easy to implement by government alone. Itneeds a lot of supporting factors and combined efforts ofgovernment,non-governmentorganizations(NGOs) and a host of institutionsand people’s participation. Such aprogramme ismicro-credit financing popularly known as micro-financing for self employed income generating projects, which is globally accepted and got executed to eradicate poverty. In Bolivia,Micro –credit loan clients doubled their income in two years. They were likely to access health care and send their children to school with the help of micro -credit ( Mosley & Paul, 2001) In Brazil almost 1.5 million people work in the informal sector economic as micro-entrepreneurs who have availed micro-finance facilitiesof them93% run profitable business ( Morduc $ Haley 2001). In Bangladesh 48% of poor households rose above the poverty line when provided access to micro-credit loan. Additionally5% of the Grameen Bank graduated out of poverty each year by participating in micro-finance programmes ( Kandker, 2003).

International Journal of Research -GRANTHAALAYAH, 2019

The dynamic development of the microfinance business has been advanced by market powers as well as by cognizant activities of national governments, Non-Governmental Organizations (NGOs), and the benefactors who view microfinance as a successful device for killing neediness. The incredible push behind this immense and expanding support for microfinance showed that national monetary and social effects are noteworthy and it should be analysed all the more intently. Self Help Group (SHG) provides microfinance services for people in rural regions so they can use the capital for small business, productive work and become financially stable and independent. In this article, we have described the impact of microfinance on poverty alleviation its impacts on people and society. Here we have explained, the main purpose of this article is to present Microfinance and how it can be useful for poor people and the reduction of unemployment.

Microfinance is essentially a financial service, routed to the poor generally through Self Help Groups (SHGs), in sheer belief that it will enhance their available choices, opportunities and empower them both socially and economically. With more than 387.38 million Indian people living below poverty line (World Bank, 2011), it becomes imperative to provide them a stimulus to overcome the quagmire of poverty and ignorance prevalent among them. The study area comprises of the selected villages of Rangjuli revenue circle of Goalpara district of Assam, where the Self Help Groups have been surveyed, regarding the microcredit and its role-both positive and negative, in their economic and social lives including their satisfaction level regarding microfinance. The study also bears significance as most of the SHGs surveyed (45 out of 57) are women groups, who are seen as most reliable in terms of repayment and utilization of loans (Joy Deshmukh-Ranadive, 2005). The result suggests that the f...

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