Citation
Dr. Shankar Chatterjee
Former
Professor & Head (CPME),
NIRD & PR, Hyderabad
Email: shankarjagu@gmail.com
Abstract:
Self-help
Groups (SHGs) of women are voluntary associations of economically backward
women who pool savings, lend to each other, and later access bank credit as a
group. They are the backbone of India's rural microfinance and the main
delivery vehicle for women-led development. SHGs are now popular in rural areas
of India, as millions of households are involved in economic activities. The
Government of India and respective state governments have been promoting SHGs
in rural India.
The study
was carried out at Borvav village, Talala block, Gir Somenath district of
Gujarat in the first week of July 2026. It is evident from the study that if
rural economically backward women under the umbrella of Self-help Groups (SHGs;
henceforth, SHG will be used) are appropriately guided and supported with
backward and forward linkages, they will earn income, whatever their
qualification. The income is used for the welfare of the households, and with
the earnings of women members, their living standards are enhanced.
PRA
(earlier known as Participatory Rural Appraisal) as a methodology and Group
Discussion as a tool were used to conduct the survey. For this purpose, three
different SHGs were selected and studied.
Keywords:
DAY-NRLM, Gujarat, Income, PRA, SHG, and Women members
Introduction
Self-help Groups (SHGs) of
women are voluntary associations of economically backward women who pool
savings, lend to each other, and later access bank credit as a group. They are
the backbone of India's rural microfinance and the main delivery vehicle for
women-led development. SHGs are now popular in rural areas of India, as
millions of households are involved in economic activities. The Government
of India and respective state governments have been promoting SHGs in rural
India.
After the successful experiment
of Self-Help Groups (SHGs) by Professor Muhammad Yunus in Bangladesh under the
umbrella of Grameen Bank, the concept of Self-Help Groups (SHGs) has become
popular worldwide for empowering women through income-generating activities.
Prof Yunus, in his book Banker to the Poor, has highlighted some advantages of
self-employment over wage employment. Some of the important points are
presented below:
1. The hours are flexible and can adapt to fit any family situation. It
allows people to choose between running a business full-time or part-time when
they need to meet crises or put their business on hold and work full-time for a
salary.
2. Self-employment is tailor-made for anyone who is street-smart and has
many skills acquired from books and technical schools. This means the
illiterate and the poor can exploit their strengths, rather than be held back
by their weaknesses
3. It allows a person to turn hobbies they enjoy into gainful
employment.
4. It offers a way out of welfare dependency, not just to become wage
slaves, but to open a store or start a manufacturing business.
5. It gives those who have just been fired from a job moral support to
start a business before they become depressed and isolated.
6. The average cost of creating a self-employment job is ten, twenty, or
a hundred times cheaper than creating an employment job.
The author studied across the country many SHGs formed by rural women
members and documented in books and research articles for the
benefit of readers and researchers. The studies were carried out in different
states of India from time to time, viz., Assam, Andhra Pradesh, Bihar,
Chhattisgarh, Gujarat, Jammu and Kashmir, Madhya Pradesh, Maharashtra,
Rajasthan, Telangana, Tamil Nadu, Uttar Pradesh, West Bengal, etc., and
observed that after forming self-help groups, women felt empowered. Because of
the earnings of the women members, the standard of living of the family also
went up. The author observed that by investing comparatively less capital, one
can earn substantial income for a below-poverty family, which can help cross
the poverty line (Chatterjee, 2017, 2018, 2019, 2020).
It is
pertinent to mention that SHGs are informal groups of people who come together
to address their common problems. A critical feature of a self-help group is
mutual support – people helping each other. In the case of rural SHGs,
essential features are monthly/weekly savings and rotating the money among the
members with a low interest rate (FAO, 1992). When the discussion of SHGs crops
up, the Ministry of Rural Development, Government of India’s National Rural
Livelihood Mission (NRLM), which was implemented by restructuring the
Swarnajayanti Gram Swarojgar Yojana (SGSY), is highlighted. NRLM has been
renamed DAY-NRLM (Deendayal Antyodaya Yojana - National Rural Livelihoods
Mission) since March 29, 2016.
Deendayal
Antyodaya Yojana - National Rural Livelihood Mission (DAY-NRLM) is a flagship
poverty alleviation programme being implemented by the Ministry of Rural
Development, Government of India, to reduce poverty by enabling poor
households to access gainful self-employment and skilled wage employment
opportunities, resulting in sustainable and diversified livelihood options for
the poor. DAY-NRLM aims at mobilizing rural poor households 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 come out of abject poverty.
As per the
information provided by the Press Information Bureau , Government of India
(source: static.pib.gov.in/WriteReadData/specificdocs/documents) DAY-NRLM
has mobilized 10.05 crore rural women households into more than 90.90 lakh SHGs
across 28 States & 6 UTs. Other notable achievements include:
• 4.62
crore SHG members engaged as Mahila Kisans.
• 3.5 lakh
Krishi Sakhis & Pashu Sakhis deployed.
• 6,000
Integrated Farming Clusters formed.
• 1.95 lakh
Producer Groups, benefiting over 50 lakh rural women.
• 3.74 lakh
enterprises supported in 282 blocks.
• Women
SHGs accessed ₹11 lakh crore in loans since 2013-14.
• 47,952
Bank Sakhis deployed in the bank branches to facilitate credit linkage of the
SHGs
In Gujarat,
more than 2.79 lakh self-help groups support 27 lakh households (up to
2024-25), all of whom belong to rural and economically backward women. The
SHGs were constituted for all castes, creeds, religions, and others.
-Study area and methodology:
To understand the functioning of SHGs, the study was conducted in Borvav
village, Talala block, Gir Somnath district, Gujarat. Three SHGs consisting of
30 members each were functioning, and among them, seven members were contacted.
For the study, the PRA (Participatory Rural Appraisal, now known as PRA)
methodology was used as a tool, and group discussions were conducted.
About
Borvav village: Borvav village, block Talala, Gir Somnath district
Borvav is a village in the Gir Somnath district, Gujarat. As of the
2011 census, the population of Borvav was 5247: male population 2718 and female
population 2529. The Scheduled Caste population was 279, and the Scheduled
Tribe population was 35. The total literacy rate was 67 percent
(villageinfo.org/village). The total number of Self-Help Groups (SHGs) in the
village was 12 (each SHG consists of 10 members, so 120 women members); the
total revolving fund (i.e., RF, a one-time grant) disbursed to all 12 SHGs was
Rs 155,000. The Community Investment Fund (CIF, also a one-time grant) was
a total of Rs six lakh.
Field
Study:
Madhuram SHG-1 and Madhuram SHG-2: In both the SHGs, a total of 20 women
members were working. Each group consisted of 10 members. All the women members
were involved with decorative items, which are used as showpieces made of nails
and coloured thread. It is pertinent to mention that 'nails' mean a 1/2-inch
size of nail inserted in a frame, and then different threads of different
colours are used with each name, and thus a garland is formed. Initially, in
2015, Madhuram-1 SHG was formed with 10 economically backward women members.
Because of the expansion of business and the high demand for the showpieces,
Madhuram-2 SHG was formed in 2023 with 10 members. The members were involved in
different activities pertaining to the showpieces. Some members make the
frames, some insert nails on the frame, some members tie the colourful threads
to the nails, and some members do the finishing work, i.e., insert a glass
cover. The Madhuram SHG-1 was given a revolving fund (RF, a one-time grant from
the Government) of Rs. 12,000 in 2016 and later on a community investment fund
(CIF, also a one-time grant) of Rs. 50,000. Also, the SHG received a
bank loan of Rs 1 lakh; after repayment, another bank loan was provided to the
SHG to the tune of Rs. 1 lakh. And again, as the third one, an amount of
Rs 1.5 lakh was given to the SHG. When the study was conducted, the members informed that repayment was going on. The
decorative items are made from small nails (half-inch size or
small in length) and colourful threads. It may be mentioned here
that screws and nails are both common fasteners used for broad application. The
showpieces are eye-catching and are used purely for decorative purposes.
As a senior citizen and former professor, after conducting extensive studies
on rural women entrepreneurs in India and abroad, I observed, for the
first time, decorative items made of nails and colourful
threads. Different types of showpieces are made of these. The
case concerns the Madhuram Mangalam Self-Help Group (SHG), which makes
artworks. Altogether, 20 economically disadvantaged women formed two
self-help groups (10 in each group) in the village to make nail-based
decorative items. Both the SHGs received support from the government. Some
women make the photo frames, some do the drawings on the paper inserted into
the frames, some put in the nails, and some put on the glass covers; thus, the
finished decorative items are made. About the activities, income, etc., of the
SHGs, one SHG leader, Ms Shreetaben Sureshbhai Rupareliya (24 years /
completed post-graduation), was interviewed. She informed us that all women
members earned between Rs 6,000 and 7,000 per month per member, which was their
additional income, as most of them had little agricultural land (that is,
marginal farmers). In addition, many of their husbands work as agricultural or
non-agricultural labourers. Ms Shreetaben further informed us that
products are sold within Gujarat and outside Gujarat, and they plan to
sell in foreign countries in the future. The showpieces are sold locally and
through two shops which are located in Shashan Gir. The
products are made throughout the year except during the rainy season of three
or four months. The SHG members requested the author that the Gujarat
government should help them with marketing and transport facilities.
On the other hand, Madhuram SHG-2, which was established in 2023,
received a revolving fund of Rs. 30,000. No bank loan was received till the
date of study. In the case of both the SHGs, savings per member per month were
at the rate of Rs 100. They are also part of the same nail-based
decorative items making because the product is in high demand in the area.
The husbands of all the SHG members were either earning as agricultural
labourers or through other activities, as in both groups, around 40% had
agricultural land, and they were in the category of marginal farmers. So those
who had agricultural land were not sufficient to sustain a family. All women
members earned between Rs 6,000 and 7,000 per month per member, which was their
additional income, as most of them had little agricultural land (that is,
marginal farmers). In addition, many of their husbands work as agricultural or
non-agricultural labourers. Ms Shreetaben further informed that products are
sold within Gujarat and outside Gujarat, and they plan to sell in foreign
countries in the future. The showpieces are sold locally and through two shops
which are located in Shashan Gir. The products are made throughout the year
except during the rainy season of three or four months. The SHG members
requested the author that the Gujarat government should help them with
marketing and transport facilities.
Another case of SHG is presented here. Nirbhav SHG was
established in 2021 with 10 members. Of the 10 households, eight had
agricultural land (marginal farmers), and two did not have any land, so they
were eking out their livelihood as labourers. Each member was saving at the
rate of Rs 100 per month, which continued till the day of study. The SHG
was provided a revolving fund of Rs 15,000 and a community investment
fund of Rs 1.50 lakh. In 2023-24, the SHG was provided with a bank loan of
Rs 2 lakh. The case is from Nirbhav SHG, where 10 women members were involved
in economic activities. In Nirbhav SHG, one woman member, Varshaben
(48 years old, intermediate pass), was making herbal products, a traditional
skill she inherited from her family. She was making products at home, such as
shampoo, herbal hair oil, various soaps made with neem and camphor, face
wash, Dantmanjan (herbal tooth powder), etc. She borrowed Rs 2 lakh
in 2023-24, which was under repayment at the time the study was carried out.
She has got the registered trademark and applied for a license.
According to her, her products are sold locally and at exhibitions in the
State. During the interaction, she stated that once the license is available,
her market will be large. Anyway, after all expenditures, including repayment
of the bank loan, her net income was around Rs. 15,000 per month.
The earnings of other members were from different activities, mainly
through petty trade.
Conclusion: From the above discussion, it is evident that by
forming SHGs, rural women, by earning income, felt empowered; subsequently,
households could develop economically, and ultimately, this led to the welfare
of the family. The SHG members stated that they received good support from the
district DAY-NRLM department, and all officials were helpful to them in
sustaining the SHGs. It is evident that rural women have the capability to
earn, as they have entrepreneurial skills, and considering their educational
background, sex, and geographical location, the SHG is the best alternative to
work.
(The author expresses his
deep sense of gratitude to Hiren Yadav, Asst Project Manager, Talala Block, Gir
Somnath District, Gujarat for his support in carrying out the study).
Note:
1) Revolving Fund (RF): DAY-NRLM provides a
Revolving Fund (RF) support to SHGs in existence for a minimum period of 3/6
months and follows the 'Panchasutra'—regular meetings, regular savings, regular
internal lending, regular recoveries and maintenance of proper books of
accounts. Only such SHGs that have not received any RF earlier will be provided
with RF as corpus. The purpose of RF is to strengthen their institutional and
financial management capacity and build a good credit history within the group.
2) The Community Investment Fund (CIF) is administered through the federations. CIF
comes from both the state and the central government at the cluster-level
federation (CLF). CLF, in turn, gives the money to the village organizations
(VOs) as a loan, and the VOs, in turn, give it to self-help groups as a loan
for income-generation activities.
References:
1) Yunus Muhammad “Banker to the poor”; the story of the
Grameen Bank”, (2007) Published by Penguin Books
3) FAO, Rome, (1992) , “ Glossary of terms for agricultural
insurance & rural finance”
4) Chatterjee Shankar
(2017) “Emerging Trends in Rural self-employment in India” (Dedicated to
Prof Swaminathanan sir, (Father of Green
revolution in India) RBSA Publishers, Jaipur.
5) Chatterjee Shankar (2018) “Rural Development in India:
Present Perspective”, Edupedia Publications
6) “Major RuralDevelopment Programmes with Case Studies at
Samastipur District, Bihar” (2019) Published by New Delhi Publishers, New Delhi
& Kolkata, ISBN 978-93-88879-55-2
7) https://static.pib.gov.in/WriteReadData/specificdocs/documents/2025/oct/
