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• The Government of India has drawn several policy measures to achieve “gender equality” and “gender empowerment”.
• One of such measures is the promotion and economic activation of Self-Help groups (SHGs).

What are SHGs?

• Voluntary associations: SHGs are voluntary associations of economically poor, usually drawn from the same socio-economic background.
• Community action: They often resolve to come together for a common purpose of solving their issues and problems through self-help and community action.

SHG-led Women Empowerment: A timeline

• ‘Grameen Bank’ model: In 1984, for the first time, the concept of social mobilisation and business development through organising of SHGs was introduced based on Prof. Yunus’s ‘Grameen Bank’ model.
• NABARD intervention: Initially, the National Bank for Agriculture and Rural Development (NABARD), along with NGOs designed and developed the promotional ecosystem, including the SHGs-Bank linkage programme.
• RBI recognition: In the year 1990, the RBI recognised SHGs as an alternate credit flow model.

Thus, SHGs were accepted as group-based clients of banks for both deposit and credit linkages, collateral-free lending, and lending to groups without specification of purpose/ project.

Various committees related

[A] Prof. S. R. Hashim (1997) committee

• It reviewed the poverty alleviation and employment generation programmes of the Ministry of Rural Development.
• It recommended shifting focus from an individual beneficiary approach to a group-based business development approach.
• Hence, Integrated Rural Development Programme (lRDP) and its associated schemes were merged.
• A new scheme called ‘Swamjayanti Gram Swarozgar Yojana’ (SGSY) was launched to provide self-employment to below the poverty line households through the formation of SHGs.

[B] Prof. R. Radhakrishna (2009) Committee

• It reviewed the performance of SGSY and suggested changes in its design from a ‘top-down poverty alleviation’ approach to a ‘community-managed livelihood’ approach.
• Emphasis was given to linking SHG members to social welfare programs.
• SGSY was restructured into National Rural Livelihood Mission (NRLM) to provide sharper focus on poverty alleviation.
• Now, the NRLM has been renamed as Deendayal Antyodaya Yojana — National Rural Livelihoods Mission (DAY-NRLM).

DAY-NRLM & Women Empowerment

DAY- RLM has a twin objective

1. Organising rural poor women into SHGs; and
2. Constantly nurturing and assisting them to take up economic activities.
3. It aims to reduce poverty by enabling poor households to access gainful self-employment and skilled wage employment opportunities, through building strong grassroots institutions for the poor.
4. The programme aims to ensure that at least one-woman member from each rural poor household (about 9 crores) is brought into women SHGs.

Principles of SHG movement: The Dashasutras

The SHG movement follows five principles or ‘Panchasutra’ viz:

1. Regular Meetings
2. Regular Savings
3. Regular Inter-Loaning          
4. Timely Repayment of Loans and
5. Up-to-date books of Accounts

In addition, five additional principles now followed by SHGs are

1. Health, Nutrition and Sanitation
2. Education
3. Active involvement in Panchayati Raj Institutions (PRIs)
4. Access to Entitlements and Schemes and
5. Creating Opportunities for Sustainable Livelihoods.

These taken together are called – ‘Dashasutras’ under DAY-NRLM.

Women Entrepreneurship and Economic Progress

• There are mainly three central aspects of entrepreneurship:
• Uncertainty and risk
• Managerial competence and
• Creative opportunism or innovation
• Hence, promotion of entrepreneurship through SGs would require empowerment of millions of SHGs.
• If women SHGs are empowered they can ensure job opportunity by effectively utilising available resources into profitable products as per the local need and the acceptability of consumers.

DAY-NRLM & Empowering Process

The nucleus of DAY-NRLM has been built around a basic human nature of the feeling of self-worth and self-help. Following four pillars of the scheme ensure the empowerment process in DAY-NRLM:

(1) Social Mobilisation, Formation and Promotion Of Sustainable Institutions Of Poor:

• These community-based organisations adhere to core principles of democratic governance and financial accountability.
• It participates effectively in local governance and development, mediate livelihood concerns and social issues affecting the poor members, facilitates access of the poor to entitlements and public services.

(2) Pillar of Financial Inclusion:

• Here focus is laid on both demand and supply-side interventions.
• Demand-side interventions ensure the promotion of effective book-keeping: provision of capital support to SHGs; creating a culture of prompt repayments of loans etc.
• Supply-side interventions confirm the formation of sub-committees of State-level Bankers Committee in all states; bankers’ sensitisation on concept, practices, etc.

(3) Livelihood:

• The focus is on strengthening existing and new income sources, promotion of opportunities. The scheme empowered women SHGs to take up non-farm livelihoods activities too.
• Start-Up Village Entrepreneurship Programme (SVEP) promoted rural start-ups in the non-farm sector.

(4) Social Inclusion and Convergence:

• Platforms established by SHGs are leveraged for better implementation of multiple public welfare schemes/programmes.

Issue & Challenges

The SHG movement traversed from the “thrift and saving” in the 1980s to the “livelihood” based economic empowerment method. Despite such progress, it is suffering from many challenges, as discussed below:

• Universal social mobilization: Identification and inclusion of the poor remains a challenge. There is need to develop community resource persons for participatory identification of poor.
• Training, Capacity Building & Skill Upgradation: There is lack of appropriate training plans, quality training and availability of expert training institutions.
• Universal Financial Inclusion: Lack of uniform financial management systems at all tiers of SHGs has impacted the growth in bank accounts, improvement in financial literacy, and absorption capacity of community members.
• Multiple & Diversified Livelihoods: There is lack of progressive leadership for inclusiveness of small-sized enterprises at the federal level. Market/ forward linkages, is largely missing.
• Support Structure at the Community: Creation of business environment, enhancement of skills, and identification of value chains with proper clustering across the state along with positioning competent human resources in the SHGs ecosystem are required.
• Schematic Convergence: Field level schematic convergence is the need of the hour to bring synergies directly or indirectly with the institutions of poor.