Question

Imagine you are a part of a 'Self Help Group' (SHG). Explain the working system of the Self Help Group (SHG) to the new member.

Hint:

Self Help Groups (SHGs) empower people financially by encouraging savings, loans, and skill development.

Answer 1

1. Group Composition: Self-Help Groups (SHGs) are composed of 10-20 individuals, predominantly women, who pool their savings.
2. Consistent Savings and Lending: Members regularly deposit small sums, and the group offers loans to its members as needed.
3. Affordable Credit: SHGs offer financial assistance with interest rates lower than those of banks and private lenders.
4. Capacity Building: Members receive training for income-generating pursuits such as tailoring, crafts, and dairy farming.
5. Enhanced Social Standing: SHGs foster self-sufficiency, decision-making capabilities, and the empowerment of women.