Shg Movement Case Study

2367 Words 10 Pages
1.1. Background of the study
1.1.1. SHG movement in India
A number of experiments were made during the last century towards poverty alleviation in the country. The attempts were at finding technical solutions, infrastructural solutions, financial solutions, institutional solutions; skill training solutions, rights based solutions. Large scale projects, large bureaucracies, large scale developmental institutions, programs and schemes were seen as a means which would address poverty in the country. A major experiment which attracted large scale attention of development players is the concept of self-help groups (SHGs). SHGs were seen as a means of enhancing financial inclusion, poverty alleviation and women empowerment.
Beginning with grassroots
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SHG federation has emerged as a critical institutional mechanism to ensure sustainability of SHGs besides providing them both financial and non-financial support. The main objective of federating the SHGs is to make them stronger and ensure their organizational, operational and financial sustainability. The earliest SHG federation was formed by the then PRADAN (presently the Dhan Foundation) in Tirupati in 1992 and later in Madurai, soon followed by CDS, Alappuzha in 1993 and MYRADA in 1996. Rapid expansion in the number of SHG federations took place in South India in the later 1990s, particularly with the introduction of several externally funded projects through DRDAs. There are more than 1,70,000 primary federations, 7,091 secondary federations and 66 tertiary federations in the country. Southern and eastern regions account for more than 90 percent of total number of federations in the …show more content…
In legal dimensions, Trusts / Society acts places restrictions on financial services by federations. Federations find it difficult to provide adequate services to SHGs which has a bearing on the quality of SHGs. In relation to credit supply, it remains grossly low in relation to demand. In financial services, there are issues related to lack of robust accounting systems and accounting processes in place. In sector development, while SHGs may be having auditing they do not have AGM to discuss audit reports and for appropriation of profit / loss. In social services, federations are not pursuing the same due to poor ability to generate funds. In livelihood, there is more focus on marketing of external products and relatively less on marketing of the member’s

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