Self Help groups are groups of rural poor people (especially women). The idea is to help them organize themselves, help them financially, provide them work, help them in other matters including domestic issues. Such groups are helped by the government and its policies.
Government provides such groups loans at very low interests and provides help to market the products of SHG. There are usually a dozen or more members in a group. This group acts an intermediary between the people in the village and the banks.
NABARD (National Bank for Agricultural Rural Development) helps the SHGs to promote the cottage (handicrafts, oils, soaps, packaged agro-products, pickles, chutneys, home foods etc) and village industries.
FUNCTIONS OF SELF HELP GROUP: - A Group consists of 15 to 20 homogenized women members having a common name and elected three leaders. The Group has a Savings Bank account which is operated by any two of the above mentioned three leaders.
- The Group gather once in a week and record Minutes.
- The Group save regularly a fixed amount and deposit it in the Savings Bank account. After three months of savings, the saved money is given to a very needy member in the Group as a loan with minimum interest. This process is continued for six months.
- After six months of successful operation the Bank examines the Group and sanctions Rs. 25,000 as a Revolving Fund to the Group to start micro Enterprises.