The full form of SHG is the Self Help Group.
A self-help group is a type of informal committee where few people from almost similar socioeconomic backgrounds. These people come collectively to help each other and find a path as a group or team to develop their comprehensive habitat condition.
Self Help Groups are encouraging their members for little regular savings and most of the time they keep these savings with the bank. These are common funds of that SHG. After some time when there is enough money, SHGs start to lend this money to their members with little interest.
Features of Self Help Groups
- Self Help Groups are mostly found in India. Furthermore, In other South Asian and South-East Asian countries, we can find this type of group.
- SHGs are self-governed and consist of people from the same village or area and with the same type of problems. They work together to achieve a common objective.
- There are almost 664,369 villages in India. Here, most people are connected with poverty, illiteracy, lack of skills, lack of formal credit, etc. Most of the time as an individual it’s become a little difficult for them to tackle it. So as a Self Help Group they make a collective effort to solve their problem.
- Initially, an “animator” who is well known to the community and educated helps the poor to form a Self Help Group.
- The State Government, the local branch of a bank, and different NGOs help these SHGs with proper guidance and training.
- Mostly Self Help Groups are composed of 10 to 25 people, especially women between the ages of 25 to 40.
Major Objectives of Self Help Groups
Some of the major functions of Self Help groups are listed below.
- Self Help groups focus on constructing operative potential for developing ways of income or employment in the village expanse for the poor and marginalized folk.
- People in SHG use to save money and also loan that collective money amongst the group members with a lower rate of interest than informal service providers with their criteria.
- Self Help Groups also can get loans from banks at small rates of interest if their savings are regular and thus they function as a unified guarantee system for the group member who wants to borrow from organized sources.
- With mutual discussions, SHGs also settle conflicts of the people of the area from where they belong.
- Furthermore, Self Help groups provide microfinance assistance to the poor.
Benefits of Self Help Groups
- The SHGs promote banking literacy amongst their members by motivating them to save money regularly. It also acts as an organized system to reach the banking facilities.
- This group empowers women and by embodying leadership activity amongst them they are fighting against gender inequality and also the participation of women in gram sabha and elections is increasing.
- SHGs also work together to protest against social issues like alcoholism or the dowry system. Furthermore, they become a voice to highlight problems like poor health care and social injustice.
- These groups are also increasing the efficiency of different schemes of the government and curtailing fraud through social surveys. Thus poor and marginalized people are getting benefits as most of the government schemes target the improvement of these people.
Disadvantages of Self Help Groups
There are also few weaknesses of the SHGs, like
- Though these groups are mainly for poor people, nowadays groups don’t inescapably appear from the neediest background.
- Also though the social life of the poor is elevating their economic condition is not improving after joining SHG.
- Most activities of the Self Help Groups are founded on primitive skills which are directly related to the primary sector, due to this the group members are not getting adequate value and wages in return for their work.
- Also, most of the time SHGs are entirely dependent on NGOs or other government agencies, thus they collapse when the backing is interrupted.
Challenges, that SHGs are facing in a country like India
- Lack of proper knowledge amongst the SHGs regarding sustainable and profitable livelihood options is one of the biggest challenges for the Self Help Groups in India.
- Also, lack of skill and resources are preventing them from achieving handsome wages by doing micro-unit enterprises.
- The Patriarchal Society of India is also creating resistance in the way of women empowerment through these SHGs.
- Also, lack of security and sustainability is an important issue that the SHGs are facing nowadays.
SHGs are one of the finest tools for eradicating rural poverty as they encourage poor people’s access to credit and financial services. It also empowers women and poor people to raise their voices against exploitation. Though there are some weaknesses of SHGs and they are also facing some challenges, it is believed that with proper guidance of forms and the government’s help these issues could be solved. However, Self Help Groups teaches to work and solve problems together which is always inspiring for the betterment of the community.