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Govt. close to achieving targetof 10 crore SHG members

  • Published
    17th Feb, 2023
Context

According to the Ministry for Rural Development, the government is well on its way to reach the target of 10 crore Self Help Group members by 2024.

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Key-highlights

  • The number of SHG members has reached over nine crore from 2.35 crore in the last nine years.
  • The bank linkage of SHGs has crossed over 6.25 lakh crore rupees during the same period. H
  • Within a few years, the target of ten lakh LakhpatiDidisis expected to be achieved.

What is a Self-Help Group (SHG)?

  • A Self-Help Group is defined as a “self-governed, peer-controlled information group of people with similar socio-economic background and having a desire to collectively perform common purpose”.
  • SHG is a mini voluntary agency for self-help at the micro level and has been focused on the weaker section particularly women for their social defence. 
    • The concept of SHGs serves the principle “by the women, of the women and for the women”.
  • SHGs are informal associations whose members pool their savings and relent within the group on a rotational or need basis.
  • Such groups work as a collective guarantee system for members who propose to borrow from organised sources. 
  • Functions:The most important functions of a Self-Help Groups are:
    • 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.

Objectives

  • Inculcating banking:The main objectives of SHG is to inculcate the habit of thrift savings, banking culture, that is, availing the loan and repaying the same over a given period of time and in the process, again economic prosperity through credit.
  • Empowering women:The SHGs significantly contribute to the empowerment of poor women by involving them in some productive activity which in turn will yield something to overcome their poverty.

Impact on society by SHGs

  • Removal of informal actors:The SHG programme has contributed to a reduced dependency on informal money lenders and other non-institutional sources.
  • Moving towards education:It has enabled the participating households to spend more on education than non- client households. Families participating in the programme have reported better school attendance and lower drop-out rates.
  • Better health and life:The financial inclusion attained through SHGs has led to reduced child mortality, improved maternal health and the ability of the poor to combat disease through better nutrition, housing and health – especially among women and children.
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