B. S. Raghavan

THE growth of self-help groups (SHG) in this country, especially in the Southern States, has been nothing short of phenomenal. What a unique success story it has been will be evident from these figures: There are seven lakh SHGs in India, which works out to an average of more than one per village.

The membership of 90 per cent of them is made up of only women, and all together have a record of 95 per cent repayment of loans on time and with interest. Up to the end of March 2003, 1.16 crore poor families (comprising approximately 5.80 crore individuals) have been assisted through bank credit and the average bank loan per SHG amounts to Rs 28,560.

While, as many as 504 banks have been active in financing SHGs, the State Bank of India, the Andhra Bank and the Indian Bank have catered to the maximum number, cumulatively disbursing Rs 2,049 crore. They normally charge 8.75-9 per cent interest for SHG loans up to Rs 50,000. Thanks to the SHGs, the amount of net credit to women by banks has touched the target of 5 per cent of total credit.

There is no requirement of physical collateral other than the savings of the groups, the members of which jointly execute an undertaking to repay the loan advanced to any single member.

The peer pressure of joint liability only partly explains the incredible rate of timely repayment; rural women, in general, are found to be particular in adhering to commitments with a sense of purpose and honesty.

Contrary to the urban image of village women, every member participates in decision-making and the group as a whole assumes collective responsibility for proper and efficient management. They have also been quick to master the documentation and accounting requirements.

Most of them come from families living below the poverty line but, within a short time, are able to pool sufficient resources to edge out money-lenders and take care of the basic funding needs. As of now, the flow of a larger proportion of loans taken by members is for consumption, but the situation is fast changing with SHGs going for productive (asset-creating and income-generating) investments too,

It is fitting, therefore, that the national seminar organised by the M. S. Swaminathan Research Foundation in Chennai on July 18, should pin its hopes on them to be the harbinger of a self-help revolution bringing about water, food and livelihood security, without depending on the Government.

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