Empowerment and Financial Inclusion: Self-help groups (SHGs) play a crucial role in empowering individuals, particularly women, by providing them with a platform to come together, collectively save money, and access credit facilities.
Poverty Alleviation: SHGs help in alleviating poverty by promoting entrepreneurship and income-generating activities within communities.
They provide members with the opportunity to start small businesses, engage in livelihood activities, and improve their economic conditions.
77
Skill Development and Capacity Building: SHGs focus on enhancing the skills and capabilities of their members through various training programs.
These programs cover areas such as financial literacy, leadership development, entrepreneurship, and vocational skills, enabling members to become self-reliant.
Social Cohesion and Women's Empowerment: SHGs promote social cohesion by fostering a sense of belonging and mutual support among group members.
78
They provide a platform for women to voice their opinions, participate in decision-making processes, and challenge social norms, leading to increased gender equality and women's empowerment.
Access to Financial Services: SHGs enable marginalized communities, especially women, to access formal financial services such as savings accounts, loans, and insurance.
This access enhances financial security and enables members to invest in education, healthcare, and productive assets.
79
Community Development: SHGs contribute to the overall development of communities by addressing social issues, promoting education and health awareness, and undertaking collective initiatives for community welfare.
Microfinance and Poverty Reduction: SHGs act as intermediaries for microfinance institutions, facilitating access to credit for their members.
This access to microfinance helps in poverty reduction and enables members to invest in income-generating activities and improve their living standards.
80
Sustainable Development: SHGs promote sustainable development by addressing social, economic, and environmental issues at the grassroots level.
Through their collective efforts, SHGs contribute to poverty reduction, women's empowerment, and overall community development.
81
Challenges
Lack of knowledge and proper orientation among SHG-members to take up suitable and profitable livelihood options.
Patriarchal mindset – primitive thinking and social obligations discourages women from participating in SHGs thus limiting their economic avenues.
Lack of rural banking facilities – There are about 1.2 lakh bank branches and over 6 lakh villages.
Moreover, many public sector banks and micro-finance institutions are unwilling to provide financial services to the poor as the cost of servicing remains high.
82
Sustainability and the quality of operations of the SHGs have been a matter of considerable debate.
No Security – The SHGs work on mutual trust and confidence of the members.
The deposits of the SHGs are not secured or safe
Only a minority of the Self-Help Groups are able to raise themselves from a level of micro-finance to that of micro-entrepreneurship.
COMMENTS