WOMEN EMPOWERMENT AND ERADICATION OF POVERTY THROUGH SELF HELP GROUPS

WOMEN EMPOWERMENT AND ERADICATION OF POVERTY THROUGH SELF HELP GROUPS

BY

Dr.P.PACKIRISAMY      Associate Professor, Department of  Corporate Secretaryship,

SIVET College, Chennai-600073.

INTRODUCTION:

Empowering women is empowering the nation. Women constitute nearly 50% of the total human resources in our country. But they are economically and socially backward.  To overcome this disparity, WSHGs play an attractive role in their development.  In 2009-10, the Govt. of India has planned to enroll at least 50% of Rural Women in the country as members of SHGs over the next 5 years and link them to various banks. SHG provides community platforms to women from which they become active in village affairs. Women in general are the most disadvantaged people in Indian society, though their status varies significantly according to their social and ethnic backgrounds.

The empowerment of women through SHGs has been initiated in Tamilnadu as early as in 1998 in Dharmapuri District.  The success of this had led to out come of Mahalir Thittam (Plan for Women) was launched from 1997-98. In 1992, NABARD (National Bank for Agricultural and Rural Development) conducted a pilot project, as a partnership model between SHGs, BANKS, and NGOs and found that it was more successful and effective.

Self Help Groups:

SHG is “a voluntary association of people formed to attain certain collective goals both economic and social.  Each group consists of 15 to 20 members mostly female groups”. Eradication of poverty is the prime aim of promoting SHGs which empowers the women in self-reliant, decision making process, leadership and standard of living.

Objectives of the study:

  • To study the method of functioning various WSHGs in Kanchipuram Districts.
  • To evaluate the overall performance of MFIs,NGOsand Banks in promoting SHGs
  • To identify the problems in SHGs and suggestions to overcome them
  • To measure and evaluate the Empowerment of SHG Members

Methodology:

The study has been done through the primary data collected from selected WSHGs, mostly covered under Bank→NGOs →SHGs Linkage models in Kanchipuram District and the secondary data collected from NABARD and RBI Reports and Tamil Nadu Corporation for Women Development.  The Simple Random sampling Method is adopted.

WOMEN EMPOWERMENT:

Women empowerment takes place in the fields of Economics, Education, Social, Cultural, Psychology and Politics.  It represents Economic Independence, Self-reliant, Self-confidence, Leadership, Respect, Recognition, Political, Social and legal awareness. SHG promotes thrift,

savings, entrepreneurship skills besides  changing the social attitude and status of women in society.  Micro finance activities are economic activities in developing empowerment of women.  SHGs are not only a micro-credit groups but also a social security groups.  The United Nations’ third Millennium Goal is, to promote Gender Equality and Women Empowerment.

WOMEN ENTREPRENEURS:

SHGs help the rural women to enter into farm, non-farm and entrepreneurial activities. Making Handicrafts, Bags, candle, leaf plates, cattle rearing, sale of food products, flowers, fruits, vegetables and agricultural activities are various income generating activities for the members.  It leads them to be self – reliant and economic independence.  These enterprising activities make them to repay the loans, saving in the bank and tremendous changes in their standard of living. SHGs provide them BANKING ACCESS AND ACCOUNTABILITY.

Micro Finance Leads to Households’ Income

It is understood that the households’ income of SHG members are higher than the non members’ household income.  The following comparison among three South Asian Countries depicts the  income growth level of SHG members and non members.

Table: 1. Country wise comparison on SHG Members Household Income

Country

MFI-Borrower Households

Income Increase in %

Non-Borrowers income

Increase in %

India

46%

24%

Sri Lanka

15.6%

9%

Bangladesh

29.3%

22%

Source: Micro Finance Book review – Pondicherry University

In Bangladesh, the MFI borrower households’ income is higher than Sri Lanka.  Because the Grameen Bank Model which was initiated by the father of Micro- Credit Dr.Mohamed Yunus,  a Noble Price Winner for Peace. Indian households’ income increases at higher rate when compared to all other countries because of the largest net work of NABARD and its Agencies.

SHGs AND WOMEN EMPOWERMENT

SHGs have brought about several changes in the society over the years. Some of them are listed below:

SHG has improved the confidence and communication skills among its members.

Awareness about various Government welfare schemes and participation of poor women in                   those schemes have increased.

The economic status of SHG women has improved as they have taken up various economic        activities.

SHG women have come together breaking the caste and communal barriers.
Higher level of participation of women in Grama sabha and Panchayat Raj Institutions.

More than 6,800 SHG members have won the Local body elections held in 2006.
Easy access to bank loans since the credibility of the SHGs have increased from the point of

view of the bankers.
Problems relating to lending have been solved to a greater extent.

It helps better nutrition and health.

Table: 2.SHGs AND BANK FINANCE

Year

No. of SHGs financed by Banks in Lakhs

Cumulative No.of SHGs financed in Lakhs

2003-04

3.62

10.79

2004-05

5.39

16.18

2005-06

6.20

22.38

2006-07

6.87

29.25

2007-08

12.39

34.00

Report is based on NABARD.

NABARD had covered more than 5.80 crores poor households and making itself as the largest Micro Finance Programmes in the world. The World Bank estimates that the Indian Micro Finance activity currently reaches only 4% of the poor.  According to the World Bank Report one-third of worlds poorest are in India.  The economic growth alone will banish the intensity of poverty.

Table:3.  Distribution of Micro Credit to Members through various Models.

Model

Agency

% of Total Members

1.

Grameen Bank

44.9%

2.

Individual Banking

2.3%

3.

Mixed Model (MFIs and Grameen,SHGs Model)

6.3%

4.

SHGs

46.5%

Rate of Interest:

There is larger criticism among members about the exorbitant interest rate charged by some of the MFIs.  The present interest rate is stipulated by NABARD.  However freedom is given to them to fix their own rate of interest based on their services.

Table.4   SHGs and Interest Rates

Description

Banks

NGOs

MFIs

Average Interest Rate on lending  %

8.3%

10.6%

19.1%

Average Interest Rate on borrowing %

5.3%

6.3%

6.6%

Operation Cost on % of Loan

3.9%

2.5%

9.6%

(Source: rbi.org.in)

The exorbitant interest rates charged by the MFIs are really a grieve concern for the WSHGs.

Uniform Rate of Interest will benefit the SHGs in a greater level.

MEASUREMENT OF WOMEN EMPOWERMENT:

There are no any concrete methods to measure the women empowerment, but we can measure them by the following indicators:

(i) Economic Empowerment: The income of the members before and after joining the SHGs and possession of various luxurious as well as essential goods. eg. Refrigerator, washing machine.etc.

(ii) Family Empowerment: The women should play a vital role in decision making process in the family, freedom to spend earnings for the family and self respect with in the family.

(iii) Socio – Psychological Empowerment: Ability to face and solve any problems, power of decision making, leadership, enhanced knowledge and the courage to voice against injustice

(iv) Political and Legal Empowerment: Participation in political process, removal of legal discrimination against women. Are the few indicators for measurement of women empowerment.

STATUS OF SHGs IN TAMIL NADU (AS ON 31-03-2010)

  • Total No. of SHGs  4,41,311
  • Total No. of SHGs women members 69.91 Lakhs
  • Total No. of Rural SHGs 3,02,092
  • Total No. of Rural SHG members 48,33,472
  • Total No. of Urban SHGs 21,57,894
  • Total Savings Rs.2,568 Crores
  • Total No. of SHGs Credit linked 4,02,046
  • Total No. of SHGs 4.69 lakhs as on 30-10-2010 with 70 lakhs members.
  • 99% of SHGs Bank Loans are promptly repaid by the groups.

FINDINGS OF THE STUDY:

  • Generally SHGs making savings between Rs.40,000 to Rs.1,20,000. per year
  • The average internal finance of each group is Rs.80,000 per year
  • The WSHGs are comparatively more efficient and effective in functioning
  • The recovery rate of WSHGs is 99%
  • 72% of SHGs are funded by bank linkage
  • Interest rate by MFIs are higher than the bank lending rates
  • MF Credit at present available only Rs.300-400 crores but Rs.2000 crores of equity is needed for Micro Finance Market.
  • NGOs play a vital role in promoting SHG in India
  • Kanchipuram district stands FIRST in promoting large no.of SHGs 24,000 with 3,72,339 women members
  • Indian Banks stand FIRST in promoting SHGs in Tamil Nadu and awarded the BEST PERFORMING BANK.
  • Tamil Nadu Women Development Corporation has promoted 46.5% of WSHGs in Tamil Nadu under Mahalir thittam with the help of NGOs
  • As on 31.03.2010, 469 NGOs have been affiliated with TNCDW.
  • The SBI stands FIRST in India, promoting 7,68,000 SHGs with credit link of Rs.24.2(billion)
  • Indian Bank stands SECOND in India, promoting 93,000 SHGs with  credit link of Rs.575 billion
  • IOB comes in THIRD place with nearly 93,000 SHGs with credit link of Rs.549 billion as on 31-3-2007.

CONCLUSION:

In a country like India, still 60% of people do not have bank accessibility and still 56% of the people borrow from the local informal money lenders.  Eradication of poverty can be done only by providing jobs to rural unemployed.  Empowerment of women is a collective activity by the Govt. MFIs, NGOs and Banks. Providing micro-credit, skills training and entrepreneurship ability are essential for women empowerment.  According to Bonaparte Napoleon – the French Emperor rightly quoted that, “Give me good mothers, I give you good Nation” – Women Empowerment alone will bring a developed India.

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Source by P.Packirisamy

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