How Self Help Groups in India is Transforming Lives
Self Help Groups are the association of financially weak people or members, which are solely created for the benefits or common interests of the group members itself.
All the members of Self Help Groups have one common interest i.e seeking the financial well being of their members belonging to the group.
In this post, you would learn What are Self Help Groups or SHG? What are the Features of Self Help Groups or SHG in India? What are the functions of Self Help Groups in India? How do Self Help Groups in India work? Importance of Self Help Groups in India. Advantages of Self Help Groups in India.
In India, there is an old saying that “God help those who help themselves”. I found this myth quite true for these Self Help Groups. Is not it?
In line with this, the Self Help Groups or SHGs started helping themselves on their own by creating self-employment and have been successful to eradicate their basic common problems by a great extent so far.
Generally, Self Help Groups are formed by taking 10 to 20 local people or members. This SHG is an informal association with a view to addressing their common problems or issues ideally form the homogeneous background.
The main reason for the creation of the Self Help Groups is the development of socio-economic conditions of the members within the group.
They are much more self-reliant and seek to enhance their current financial situation which would not have been possible without forming this group.
What are Self Help Groups or SHG?
Self Help Groups or SHG can be defined as a voluntary organisation of financially downtrodden local people working within defined rules and regulations with common socio-economic objectives.
It has been a constant endeavour of the Government towards women empowerment and economic development through Self Help Groups in India.
Before 1992 there was a huge supply of credit facilities to the formal sectors across India. But no one was even bothered to supply the same credit facilities to the informal sector like SHG.
Then the NABARD came to the rescue of these informal sectors and launched the Self Help Groups scheme as one of the informal credit facilities.
This SHG also acts as a medium for earning bread and butter for the unemployed and low-income groups who don’t have usual access to the formal credit systems.
Therefore, Self Help Group can be summarised as below:
1. Self Help Groups or SHGs are informal groups or association of a small number of people,
2. This SHG is a mutual group and the members help each other mutually,
3. Members of SHGs have similar kind of common financial problems. So, the formation of the group takes place to overcome these common problems,
4. The common interests of the SHG group are to make a better standard of living by uplifting their current social and economic conditions.
5. The members of the SHG group save a little amount of money equally each and every month and deposit the corpus in a Bank.
6. After 6 months or so, the group members can take a loan from the bank with the help of their group.
What are the Features of Self Help Groups or SHG in India?
The main features of the Self Help Groups are as follows:
1. Self Help Groups are formed with a small number of members say 10 to 20 members,
2. All the members are homogeneous in regards to socio-economic conditions,
3. All the members of the Self Help Group have one common interest i.e. upliftment of socio-economic conditions,
4. All the SHG members have equal rights and privileges within the group,
5. SHG is controlled and operated in a democratic manner,
7. Self Help Groups in India is enrolled and treated as an individual,
8. Self Help Groups are considered to be a part of the Micro Finance class,
9. An SHG provides finances to their members primarily for production purposes such as pickles, papad, dairy products, animal husbandry, ornamental fishing, jewellery and many more,
10. Loans are also given to individual members for consumption purposes but the liability to repay the loan lies on the entire group itself,
11. Most importantly members of the SHG Group must maintain the monthly thrift amount,
12. Either women only or men only SHG group is formed in India. Mixed SHG group is not preferable.
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