Self Help Groups (SHGs)- Loan Repayment Rate by SHGs to Banks is 97.71%

Loans to Self Help Groups (SHGs) are sanctioned by the banks in the name of SHGs. Distribution of loan to individual SHG members is done by the SHG, which is used by them for various activities.

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Self Help Groups (SHGs) UPSC Relevance

Self Help Groups (SHGs): Self Help Groups (SHGs) are important part of Indian governance system. They help in promotion of financial inclusion and grassroot democracy. Self Help Groups (SHGs) are important for UPSC Prelims 2023 and UPSC Mains Exam (GS Paper 2- Governance, Administration and Associated Challenges).

Self Help Groups (SHGs) in News

Recently, Union Minister of State for Rural Development Sadhvi Niranjan Jyoti informed in Lok Sabha that the Loan repayment rate by SHGs to Banks is 97.71% as on 30^thNovember, 2022.

Women Self Help Groups (SHGs) Conference 2022

Self Help Groups (SHGs) Loan Repayment

The Loans to Self Help Groups (SHGs) are sanctioned by the banks in the name of Self Help Groups(SHGs).
The distribution of loan to individual SHG members is done by the SHG, which is used by them for various activities.

Self Help Groups (SHGs) Impact Evaluation Findings

The Ministry has commissioned several impact evaluation studies to understand the overall impact of the Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM).
An impact evaluation study of DAY-NRLM was conducted during 2019-20 by the International Initiative for Impact Evaluation (3ie) with the support of the World Bank.
The assessment covered 9 states with around 27,000 respondents and 5,000 SHGs across Bihar, West Bengal, Odisha, Jharkhand, Madhya Pradesh, Chhattisgarh, Maharashtra, Rajasthan and Uttar Pradesh.
The evaluation indicates that an additional exposure to the Mission for 2.5 years led to-
- Increase in income by 19% over the base amount.
- Decline in share of informal loans by 20%
- Increase in savings by 28%
- Improved labour force participation – proportion of females reporting secondary occupation is higher (4%) in treatment areas
- Improved access to other Schemes – Significant increase in number of social schemes availed by treatment households (6.5% higher over the base value of 2.8 schemes)

What are Self Help Groups (SHGs)?

About: Self Help Groups are informal associations of people who come together to find ways to improve their living conditions. They help to build social capital among the poor, especially women.
Members: The SHG members generally have similar socio-economic background.
Key Objectives: Self Help Groups are formed with following key objectives-
- To encourage and motivate its members to save,
- To persuade them to make a collective plan for generation of additional income,
- To act as a conduit for formal banking services to reach them.
Significance: Such groups work as a collective guarantee system for members who propose to borrow from organised sources.
- Consequently, Self-Help Groups have emerged as the most effective mechanism for delivery of micro-finance services to the poor.
SHG examples: SEWA in Gujarat, MYRADA in Karnataka, TANWA in Tamil Nadu, Ramkrishna mission in Jharkhand, ADITHI in Bihar.

Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM)

DAY-NRLM aims to mobilise rural poor households into SHGs in a phased manner and provide them long-term support to diversify their livelihoods and improve their incomes and quality of life.
The Mission is also working towards empowering the women SHG members through awareness generation and behaviour change communication on issues like domestic violence, women’s education and other gender-related concerns, nutrition, sanitation, health etc.

Self Help Groups (SHGs) FAQs

What is Self Help Group (SHG)?

Ans. Self Help Groups are informal associations of people who come together to find ways to improve their living conditions.

What are the examples of the Self Help Groups (SHGs)?

Ans. Some of the most famous Self Help Group (SHG) in India are SEWA in Gujarat, MYRADA in Karnataka, TANWA in Tamil Nadu, Ramkrishna Mission in Jharkhand, ADITHI in Bihar.