THE CONTEXT: In India, the Covid-19 outbreak has engulfed into misery one and all with almost similar intensity. However, the wrath of uncertainty and hitches has been more unprecedented for the already vulnerable like women. In this scenario, the role of Self-Help Groups (SHGs) becomes pivotal for the cause of the overall development and empowerment of women.
SHGs: A BRIEF BACKGROUND
A Self-Help Group (SHG) is a village-based financial intermediary committee usually composed of 10-20 local women. The members make small regular saving contributions for a few months until there is enough capital in the group for lending. Funds may then be lent back to the members or other villagers. These SHGs are then further ‘linked’ to banks for the delivery of microcredit. It lays emphasis on capacity building, planning of activity clusters, infrastructure build-up, technology, credit and marketing.
EVOLUTION OF SHGs IN INDIA
- The first organized initiative in this direction was taken in Gujarat in 1954 when the Textile Labour Association (TLA) of Ahmedabad formed its women’s wing to organize the women belonging to households of mill workers in order to train them in primary skills like sewing, knitting embroidery, typesetting and stenography etc.
- In 1972, it was given a more systematized structure when Self Employed Women’s Association (SEWA) was formed as a Trade Union under the leadership of Ela Bhatt. She organized women workers such as hawkers, vendors, home-based operators like weavers, etc. with the primary objective of increasing their income and assets; enhancing their food and nutritional standards; and increasing their organizational and leadership strength. In order to broaden their access to market and technical inputs, these primary associations were encouraged to form federations like the Gujarat State Mahila SEWA Cooperative Federation, Banaskantha DWCRA, Mahila SEWA Association etc.
- NABARD in 1986-87 supported and funded an action research project on “Saving and credit management of SHGs” of Mysore Resettlement and Development Agency (MYRDA). The MYRDA has been promoting SHGs in Gulbarga.
- The SHG Bank Linkage Project launched by NABARD in 1992 has blossomed into the world’s largest microfinance project. NABARD along with RBI permitted SHGs to have a savings account in banks from the year of 1993. This action gave a considerable boost to the SHG movement and paved the way for the SHG-Bank linkage program.
- Major experiments in small group formation at the local level were initiated in Tamilnadu and Kerala about two decades ago through the Tamilnadu Women in Agriculture Programme (TANWA) 1986, Participatory Poverty Reduction Programme of Kerala, (Kudumbashree) 1995 and Tamil nadu Women’s Development Project (TNWDP) 1989.
- In 1999, the Government of India, introduced Swarn Jayanti Gram Swarozgar Yojana (SGSY) to promote self-employment in rural areas through the formation and skilling of SHGs.
- Deen Dayal Antyodaya Yojana – National Rural Livelihoods Mission (DAY-NRLM) in 2011, under the Ministry of Rural Development, across the country in a mission mode with the objective of organizing the rural poor women into Self Help Groups (SHGs).
- Initiatives such as the UdyamStree campaign by EdelGive Foundation, for example, have focused on women entrepreneurs in Maharashtra and Rajasthan, among other states, by leveraging SHGs such as MAVIM, and other relevant stakeholders.
- Facebook’s Pragati and Google’s Women Will, among others, have also moved the needle in fostering a level-playing field for women entrepreneurs.
SIGNIFICANCE OF SHGs
POST-COVID ERA DYNAMICS
- Due to amplified importance being given to innovation, technology and self-sustenance, especially in a post-covid era, economically weaker sections have faced an acute loss of jobs and income.
- In this context, the SHGs can help women with income-generating economic opportunities.
SOCIETAL SECLUSION
- In a society with deep-rooted patriarchy, even if women want to attain employment, the dominant tradition of female domestic responsibility coupled with social stigma limits their economic advancement and access to opportunities in comparison with their male equivalents.
- This social barrier is being overcome by SHGs simply due to its all-inclusive and women-centric participation.
NOTABLE ISOLATION
- Even though women have the potential to contribute to household finances, they often do not have the agency to participate in decisions related to avenues of income generation, thus many a time pushing their families to the brink of poverty.
- Since SHGs provide a medium for women to become entrepreneurs, it creates credible ground for more decision-making opportunities.
STATUS OF WOMEN
- While India is at the cusp of a rapid transformation in terms of evolving employment opportunities, urbanization and innovation, female participation in the economy remain crucial to where India stands globally.
- Even though working women account for approximately 432 million, about 343 million are not in paid formal job roles or work. An estimated 324 million of them are not in the labour force, and another 19 million are part of the labour force but not employed.
- SHGs have significant potential in creating jobs for women as seen in various successful examples. This rightly places women on par with the male workforce.
ROLE OF SHGs IN WOMEN EMPOWERMENT
ECONOMIC INDEPENDENCE
- SHGs provide women entrepreneurs with micro-loans to sustain their businesses, while also creating an environment for them to develop greater agency and decision-making skills.
- SHGs inculcate the habit of saving and using banking facilities among the members.
- The saving habit thus strengthens the bargaining capacity of the women and they are in a better position to acquire loans for productive purposes.
- The women gain from collective wisdom in managing their finances and distributing the benefits among themselves.
INCLUSIVENESS
- An SHG comprises a small group of women who come together to make regular monetary contributions.
- Emerging as important micro-finance systems, SHGs work as platforms that promote solidarity among women, bringing them together on issues of health, nutrition, gender parity and gender justice.
SOCIAL UPLIFTMENT
- SHG culture has brought the country changed in the gender dynamics of power within a family and ultimately the society at large.
- They now have greater say in family matters and also are seen as stakeholders and partners in taking the community forward.
- Financial independence has eventually paved the way for societal upliftment of women and their voices.
POLITICAL MOBILITY
- Many members of SHGs are being elected as legislators for bringing change and inclusive development.
- Their participation in the governance process enables them to highlight issues such as dowry, alcoholism, the menace of open defecation, primary health care etc. and impact policy decisions.
- Leadership skills learned through SHGs helped several SHG members to get elected as Sarpanch/Pradhan.
EMPOWERING WOMEN IN CRISIS
- According to a World Bank report, Women in SHGs are also working as bank correspondents, referred to as ‘bank sakhis’.
- Even during distressing times like pandemics, they are helping with the distribution of pensions, providing door-to-door service to remote communities to access their account credits from direct benefit transfers.
SHGs: SUCCESS STORIES
The footprints of the SHGs as community warriors against Covid-19 can be felt across various Indian states. For example, in Tamil Nadu, each PDS shop has been stationed with two SHG volunteers to ensure that people in the queue maintain adequate distance. In Odisha, rural women organized in these SHGs produced more than 1 million cotton masks for police personnel and healthcare workers.
KUDUMBASHREE
- In Kerala, an SHG named Kudumbashree is helping dispel fake news through its network of WhatsApp groups with more than 100,000 women as members. These platforms are specifically leveraged to disseminate urgent and authentic information regarding the pandemic.
- It is also involved in running 1,300 kitchens across Kerala and is providing food to those who are bedridden or under quarantine. The Mahila Arthik Vikas Mahamandal (MAVIM) and the numerous women SHGs operating under it played a crucial role in combating the socio-economic impact of the pandemic in rural Maharashtra.
- These women even contributed approximately ₹11 lakh to the Chief Minister’s Relief Fund through a MAVIM-driven donation campaign.
JEEVIKA & PRERNA
- JEEViKA, an organization in Bihar has stepped into the information, education, and communication (IEC) domain to disseminate awareness and preparedness materials for the outbreak.
- Prerna, an SHG in Uttar Pradesh, has attempted in communicating messages on social distancing through street art and wall paintings. A few SHGs in Jharkhand have opened a 24×7 helpline called Didi, which provides verified information to migrant labourers on evacuation and return processes to their hometowns in Jharkhand.
MAHILA ARTHIK VIKAS MAHAMANDAL (MAVIM) IN MAHARASHTRA
- SHGs in Maharashtra were unable to cope with the growing volume and financial transactions and needed professional help. Community managed resource centre (CMRC) under MAVIM was launched to provide financial and livelihood services to SHGs. CMRC is self-sustaining and provides need-based services.
- SHGs such as Mahila Arthik Vikas Mahila Mandal, UMED Abhiyan under Maharashtra’s department of rural development’s State Rural Livelihood Mission, and government schemes such as Tejaswani, etc, have proven beneficial in the development of women entrepreneurship for the cause of women’s empowerment.
MISSION SHAKTI IN ODISHA
- “Mission Shakti” is the self-help mission for empowering women through the promotion of Women Self Help Groups (WSHGs) to take up various socio-economic activities which were launched in Odisha on 8th March 2001 on the eve of International Women’s Day. Mission Shakti has the clear objective of empowering women through gainful activities by providing credit and market linkage. Empowerment of women through WSHGs under Mission Shakti is a flagship programme of the Government of Odisha. It envisages that over a period of time more & more women would be part of a WSHG. Nearly 70 lakh women have been organized into 6 lakh groups in all blocks and urban local bodies of the State so far.
KEY GOVERNMENT POLICY MEASURES FOR SHGs
- Infuse funding: Apart from NABARD, there are four other major organizations in the public sector which too provide loans to financial intermediaries for onward lending to SHGs. They are:
(a) Small Industries Development Bank of India (SIDBI),
(b) Rashtriya Mahila Kosh (RMK), and
(c) Housing and Urban Development Corporation (HUDCO).
Then, there are public sector/other commercial banks which are free to take up any lending as per their policy and RBI guidelines. Under the Self-Employment Programme (SEP), interest subvention over and above 7 per cent rate of interest is available to all SHGs accessing bank loans. An additional 3 per cent interest subvention is also available to all women SHGs who repay their loan in time.
- In 1999, the Government of India, introduced Swarn Jayanti Gram Swarozgar Yojana (SGSY) to promote self-employment in rural areas through the formation and skilling of SHGs.
- Deen Dayal Antyodaya Yojana – National Rural Livelihoods Mission (DAY-NRLM) in 2011, under the Ministry of Rural Development, across the country in a mission mode with the objective of organizing the rural poor women into Self Help Groups (SHGs) and continuously nurturing and supporting them to take economic activities till they attain an appreciable increase in income over a period of time to improve their quality of life and come out of abject poverty. Women’s SHGs are being supported by the Government of India’s National Rural Livelihoods Mission (NRLM) which is co-financed by the World Bank. NRLM has scaled up the SHG model across 28 States and 6 Union Territories of the country, reaching more than 67 million women.
- Augment Skills & Entrepreneurship: To boost the participation of women in the entrepreneurship ecosystem, the government has introduced a plethora of schemes, such as the Mudra Yojana, Udyogini Scheme, Annapurna Scheme and Stand-Up India.
- Prime Minister recently participated in ‘Aatmanirbhar Narishakti se Samvad’ and interacted with women Self Help Group (SHG) members/community resource persons promoted under the Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM). During the event, a compendium of success stories of women SHG members from all across the country, along with a handbook on the universalization of farm livelihoods was released. The Prime Minister also released capitalization support funds to the tune of Rs. 1625 Crore to over 4 lakh SHGs.
- In a bid to promote entrepreneurship among women through the formation of Micro Enterprises of Mission Shakti SHGs, the Department of Mission Shakti, Odisha in collaboration with Apparel Made-ups and Home Furnishing Sector Skill Council (AMHSSC), New Delhi has signed an agreement to launch an initiative for skill development of 10,000 Mission Shakti SHG members on apparel manufacturing.
ISSUES WITH SHGS SUSTENANCE
HIGHER NPA
- Whether the economic gains of the SHG movement are adequate to bring a qualitative change in their life is a matter of debate in India.
- The biggest challenge with SHGs currently is higher NPA percentage due to multiple financing, inadequacies in account keeping and other things.
- On average NPA of SHGs stands at around 7-8 per cent which NABARD intends to bring down to 2 per cent in the next five years.
LACKING TECHNOLOGICAL SKILLS
- Many of the activities undertaken by the SHGs are still based on primitive skills related mostly to primary sector enterprises.
- There is a lack of qualified resource personnel in the rural areas who could help in skill up gradation/acquisition of new skills by group members.
- Further, members of a group do not come necessarily from the poorest families.
DEPENDENT FOR RESOURCES
- Even after many years of existence, by and large, SHGs are heavily dependent on their promoter NGOs or government agencies.
- The withdrawal of NGOs / government agencies even from areas where SHGs have been federated, has often led to their collapse.
- The leadership and management of most SHG federations continue to be in the hands of NGOs.
- Capacity building of small groups/members is an important component of organizational effectiveness.
PARLIAMENTARY COMMITTEE REPORT (2016-17)
- The ‘Committee on Empowerment of Women’ (Rajya Sabha) found that even after the number of Self-Help Groups has gone up by nearly 70 per cent over the years, the north-eastern state of Arunachal Pradesh does not have even a single SHG.
- The committee also found irregularities in Literacy levels, a less patriarchal mindset in the south, etc.
REGIONAL DISPARITY
- There are a greater number of SHGs in Southern states compared to Northern states.
- Out of 66,000 federations, 60,000 are located in the four southern states viz. undivided Andhra Pradesh, Karnataka, Tamil Nadu and Kerala.
- The success rate of SHGs has been around 50% only and its failure is more pronounced in the North than south
THE WAY FORWARD:
Amartya Sen explains that the freedom to lead different types of life is reflected in the person’s capability set. Thus, the government policies must be directed towards increasing the socioeconomic capabilities of all of these women’s SHGs by means of the perennial flow of sustainable credit and institutional backing.
The 2nd ARC is of the view that the role of the Government in the growth and development of the SHG movement should be that of a facilitator and promoter. The objective should be to create a supportive environment for this movement.
- Since a large number of rural households in the North-Eastern States and Central-Eastern parts of the country (Bihar, Jharkhand, Uttar Pradesh, Uttarakhand, Orissa, Madhya Pradesh, Chhattisgarh and Rajasthan) do not have adequate access to formal sources of credit, a major thrust on the expansion of the SHG movement in these areas should be facilitated.
- Commercial Banks and NABARD in collaboration with the State Government need to continuously innovate and design new financial products for SHGs.
Untapped potential: In Maharashtra alone, 527,000 SHGs have had a role to play in accounting for over 50% of all women-led small-scale industrial units in India, which shows that SHGs can lead to holistic development of women entrepreneurship. This needs to be replicated in other states.
SHGs response during crisis: According to the World Bank, in over 90 percent of India’s districts, away from the limelight of the cities, SHG women are producing facemasks, running community kitchens, delivering essential food supplies, sensitizing people about health and hygiene and combating misinformation. This shows that investments in the institution of SHGs will only return good interests even in the most testing times.
Examples to learn from: Observing the crucial role they play, corporations and foundations globally have designed SHG-led programmes to help women achieve economic empowerment. Initiatives such as the UdyamStree campaign by EdelGive Foundation, for example, has focused on women entrepreneurs in Maharashtra and Rajasthan, among other states, by leveraging SHGs such as MAVIM, and other relevant stakeholders. Facebook’s Pragati and Google’s Women Will, among others, have also moved the needle in fostering a level-playing field for women entrepreneurs. This can be adopted by industrialists and unicorns from India too.
An SHG 2.0 as emphasized by the World Bank which addressed the structural and credit-related challenges of SHGs need to be implemented for making the SHGs a true vehicle for women empowerment and making the people-centered development. The government policies thus must be in line with this idea so as to achieve efficient resource mobilization and consequent upliftment of women.
THE CONCLUSION: It is important to recognize the talent of women and provide them with the right opportunities. Self Help Groups have immensely benefited people in rural areas, especially women. The self-help group movement has been one of the most powerful incubators of female resilience and entrepreneurship in rural India. It is a powerful channel for altering the social construct of gender in villages. Women in rural areas are now able to create independent sources of income. The revolutionary momentum that SHGs have created has given women an important sense of self-assurance in their journey to become aatmanirbhar or self-reliant.
QUESTIONS TO PONDER
- “There is no denying that like most difficult times in the past, women have again risen to the fore in India’s fight against the pandemic.” Discuss the given statement in the light of SHGs and their role in the COVID-19 Pandemic.
- SHGs are one of India’s most important tools for women to achieve socio-economic self-reliance. Examine
- Although SHGs have a significant history in the Indian dynamics, they are off late marred with various challenges. Examine Critically.
