CHAPTER-1

INTRODUCTION

Microfinance has become one of the most discussed subjects in the last two decades all
over the world. Microfinance means the provision of thrift, credit and other financial services
and products very small amount to the poor in rural, semi urban areas for enabling them to
cause their income levels and improving their living standards. One such form of
microfinance has been the development of the self –helpment based on the concept of ‘self –
help’ , small group of women have formed into groups of 10 to 20 and operate saving
business model where by the members saving are used to fund loans.

The results from these self help groups (SHGs) are promising and have become a focus of
intense examination as it is proving to be an effective method of poverty reduction.

The rise of SHG and formal SHG federation coupled now with SHG Bank linkage have
made this a dominant form of microfinance in addition to micro finance institutions (MFI) .
The policy environment in india has been extremely supportive for the growth of the
microfinance sector in india.

A most notable milestone in the SHG movement was when NABARD launched the pilot
phase of the SHG Bank linkage programme in February 1992. This was the first instance of
mature SHGs that were directly financed by a commercial bank. The informal thrift and
credit groups of poor were recognized as bankable clients soon after the RBI advised
commercial banks to consider lending to SHG as part of their re credit operations thus
creating SHG Bank Linkage.

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 The formation of common-interest group consisting primarily of women has had a
substantial impact on their lives. The impact of SHGs on women empowerment and social
security has been invariably an improvement from the status queue but there is a need for
support in several areas. The status of women has generally improved as they have developed
stronger contend which has changed gender dynamics and their role in the house.

One of the powerful approaches to women empowerment and rural entrepreneurship is

the formation of self help groups (SHGs) especially among women.

Self –help group linkage bank program has covered 3.47 million SHGs and 45.1 million
households. More than 90% SHGs comprise women borrowers. Women, despite their
unbearable hardship and commitment to their children for food , health and education have
beyond doubt demonstrated their loyalty to financing banks through over 95% repayment of
loans. Despite this they have difficulties to get long term loans and adequate loan of high
value.

As many as 41,60,584 SHGs saved sum of Rs. 35,127 billion with banks, showing
Rs.8,443 per SHG . Intact, the actual savings of the group would be higher as the amounts
saved with banks do not reflect the amount of savings of members of SHGs used for internal
lending within the groups as per the practice currently in vague . Government and Banks
should gratefully acknowledge their hard earned saving deposited for nations economic dev
elopement.

The present study contributes to the literature in many ways. First, kerala is head of
almost all Indian states in social indications at low levels of economic growth. But recently
several factors have contributed to fueling much political and social tension in the state; large
scale unemployment, mainly among the educated, deteriorations in agriculture .especially the
large drop in the total area under cultivation (including recently, the plantation sector);
unfavorable credit scenario (low credit-despite ratio); and the underdevelopment of the
industry sector.

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As a result close to 2000 farmers committed suicide in the state (government of kerala, 2006,
vaidyanathan 2006, jeromi,2007).these factors have also put poverty into the focus of public
policy debates and the organizations like kudumbasree could represents an alternative model
of economic advancement. Secondly, it is increasingly recognized that women share a greater
burden of poverty within the house hold.

It is in this background there is a search for alternative delivery models of micro

finance. The kudumbashree program in the state of kerala, represent an alternative delivery to
the commercial model of delivery and embraces a number of elements: microenterprises,
insurance, education, old-age assistance, etc. like microfinance programs worldwide,
kudumbashree is hailed as a success because of its high (94.5) repayment rates (government
of kerala.2005b)

The main aim of the present studies is to analyses the working pattern and savings
mobilization and other productive services the kudumbashree micro credit program.
kudumbashree being a women centered micro credit program it is interesting to examine how
such a program contributes to the removal of gender inequalities and empowerment of
women. Lastly, kerala being a state with relatively low credit deposit ratio and poor
depending on non institutional source of finance, the impact of micro finance, borrowing on
the indebtedness of borrowers, especially the issue of loan recycling and vulnerability of the
poor is an interesting area of investigation.

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Objectives of the study

1) To understand the functioning of the SHGS ,their composition, methods of working

and their linkages with financial institutions
2) To study the improvement of social, cultural and economic condition of beneficiaries.
3) To study the impact of SHGs on women empowerment.
4) To analyze the constraints and problem faced by the beneficiaries

Hypothesis

SHGs have created a conducive environment for women empowerment through

savings mobilization, credit facilities and employment oppurtunities

Methodology
For the purpose of the study both primary and secondary data have been used .primary data
is collected from the respondents with the help of questionnaire, secondary data is collected
from journals ,books ,weeklies ,internets.etc. The area chosen for the primary enquiry was
Ambalapuzha block panchayat belong in Alappuzha district.

Important of the study

In india government give more priority for the development of women entrepreneurship
several schemes (SGSY,SWASHKTI,DWCRA.ETC) have been initiated by both central and
state government to penetrate women entrepreneurs’. When women move forward the family
moves the village moves and the nation moves employment gives economic states to women.
Economic status paves the way for social status.

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 Micro finance has become one of the most discussed subjects in the last two decades all
over the world one group advocates that it has significant impact in reducing poverty. Today
microfinance programs and institutions’ have become an increasingly important components
strategies to reduce poverty or promote micro and small enterprises development. In this
context , the present study is great significance.

Scheme of the study

The thesis is categorized into five chapters which are as follows

Chapter 1: Introduction of the study.

Chapter 2: Review of literature

Chapter 3: Role of SHGs in India

Chapter 4: Role of SHGs in Kerala

Chapter 5: Analysis.

Chapter 6: Major findings and suggestion.

Limitations

1) The present study is conducted as a part of the post graduation program. so time
constraints remarkable
2) Financial constraints are there.
3) In spite of a reasonably good sample size there is doubt regarding the reliability of
information supplied by the respondents.

Chapter -2
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 Literature review

Recently NABARD has initiated bank linkage micro credit agency called self –help
group in rural areas. The women self help group is an informal organizations uopto 20n
women members from the poorer section of the village society , organized, owned, operarted
and controlled by the members , based on solidarity, common interest and resource pooling.
These group have common perception need and impulse towards collective activity. These
group promote saving among members and use the pooled resources to meet the emergency
needs of embers including the consumption needs.

Links between micro finance and women’s empowerment are viewed as optimistic,
limited by design, cost effective in eliminating poverty, and a misplaced diversion of
resources. Micro finance program range from small scale self help group to large poverty
targeted banks.

The origin micro finance can be traced to the 1976 when mohammed younus set up
grameen bank experiment on the out skirts of the Chittagong university campus, as an
experiment yunus is recognized as the father of micro credit.

In his address tat 85th rotary. International convention held in Taipei,Taiwan on june 12-
15,1994(“does the capitalist system have to be the hand maiden of the rich”) ,he illustrated a
clear picture about the slope of micro finance for eliminating poverty. In his words “if we can
come up with a system which allows everybody access to credit while ensuring excellent
repayment – i can give you a gurantee that poverty will not last long”.

“This summit is to celebrate the success of millions of determined women who

have transformed their lives from extreme poverty to dignified self sufficiency through micro
credit programmes. this summit is about creating a process that will send poverty to the
museum we will create a poverty free world”. (muhammed yunus speaking of the micro
credit summit , Washington february1997).

The world bank defined empowerment as the process of increasing the capacity of
individual or groups to make choices and to transform those choice into desired actions and
out comes “. Thus as the world bank (2001) report confirms ,societies that discriminate on
the basis of gender pays the cost of greater poverty ,slower economic growth ,weaker

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governance and a lower living standard of their people . the world bank also identifies four
key elements of empowerment to draft institutional reforms :access to information ,inclusion
and participation , account ability and local organization capacity

Rabindra nath tagore was perhaps the first person to start rural development program in
india through his ‘shantinikatan’ during pre-independent period. The government had
implemented a series of self employment and wage employment. Program like rural works
program (rwp),integrated dry land schemes(IDLAD), Area Development schemes (ADS).etc.

Choudhary (1996), in her studies stressed the need for sharpening woman’s empowering
stratagies to make them effective and result oriented.

Shylendra (1998) in his paper attempted to evaluate the performance of eight women SHGs
promoted in the vidal village by the institute of rural management ,anand (IRMA).

Gain and satish(1996) and kartar singh jain (1995) also described about group dynamics and
evolution and survival of SHGs in their paper.

In kerala however, more than nine years have passed since the program gained any
momentum. A few studies under taken by experts like leelamenon (1994). lilana marulanda
(1994) are certain examples.

TABLE 2.1: Allocations and working of SHGs among various status

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 No. of No.of Cumulative New Repeat Cumulativ
new existing no.of SHGs customers customer e bank loan
SHGs SHGs provided bank loan bank loan up to 2005
provided provided with bank during
2004-05
with bank with loan up to 2004-05
loan repeat 2005
during bank
loans
2004-05
during
2004-05
Northern
region
33,622 3381 86,018 927 145 2395
North –
eastern
21,960 125 34,238 815 3 1020
region
Eastern
region
1,07,391 24,557 2,65,628 2101 477 5183
Central
region
70,356 5431 1,97,365 1883 368 5015
Western
region
41,451 51837 96,266 1319 223 2951
Southern
region
2,64,585 2,18,761 9,38,941 10,221 11,461 52,421
Grand 5,39,365 2,58,092 16,18,456 17,266 12,676 68,985
total
(Source:-www.NABARD.com )

The NABARD conducted a study on the allocations and working of SHGs among various
status and also published relevant information in yearly. This shows in the table above.

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 Prof. arjun y.pangannavar (head of the department of economics govt arts and
commerce college gokak, kanataka) wrote an article “rural development, women self help
group” and published in southern economist march 2009. He provided a clear picture about
women self help group.

The magazine kurukshetra published in june 2010. Includes many articles regarding
women empowerment of rural women. Through this article says that” india has been an
agricultural country .women constitute about 66% of the agricultural work force. Around
48% self employed farmers are women 64%of the informal sector work force depending on
agriculture is women rural woman have , since many centuries been putting in unfathomable,
unbearable and inadequately paid joyless ,to earn for their families livelihood and provide
food security to the country’s 1.13 billion.

According to arjun.y. pangannavar ( in his articles “women SHG program and rural
poverty” published in southern economist) tells that incidence of poverty is more in rural
india. government made their efforts through rural development program to overcome the
problem of poverty. But these programmers are reduce to mere subsidy giving progammes
and by failed tom provide safety nets are guaranteed employment stable assured income and
gender justice so women empowerment issue has receive more thrust and significance in
rural development studies. Unless and until village are free from poverty, the efforts of
development of Indian economy are facile, fruitless and rather burden some.

P .sanjeev kumar in his article SHG movement and women empowerment in andra
paradesh published in southern economists says that the complexity of the concept of women
empowerment is clear from the various perspective and methodologies that have been used to
measure it is therefore not surprising that every investigation of the impact of micro finance
programmes on women empowerment has its own incomplete interpretation of the concept.

The new microfinance literature highlights the gender by emphasizing the role of women in
the microfinance revolution. Traditionally, women has less access to credit.some of new
lending schemes like higher loan amount overtime and easy installments are important tools
to attract female borrowers.

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 Chapter - 3

Role of SHGs in india

Over the years a plethora of poverty alleviation programmers have been implemented in
india and a huge amount of social and financial investment has been made to achieve the sole
aim and objective of poverty eradication. Most of the programmers were based on top down
approach and did not consider needs and requirements of the people .according to the
economically vulnerable groups continued to remain under – confident and guarantee for
security of the livelihood was found missing in the entire endeavour to eradicate poverty from
the soil of india. Considering the large number of persons still living below the poverty line ,
there is no doubt that the resources pumped down for poverty alleviation and provision of
subsidies in the name of poor have not been much effective inn achieving the goal of poverty
alleviation.

For the eradication of rural poverty, there was need for the self employment and wage
employment programmes like rural works programme (RWP), integrated duty land
agricultural development (IDLAD), area development schemes (ADS).etc. the credit
institutions like nationalized commercial banks , regional rural banks , co –operative banks
.etc. have been instituted in rural areas to extend credit facilities to the rural poor.

SHG BANK LINKAGE

India has the worlds extensive banking infrastructure .there are about 60,000 retail credit
of the formal banking sector comprising 12,000 branches of the district level co-operative
banks ,over 14,000 branches of regional rural banks and over 30,000 and semi – urban branch
of commercial banks in addition to 1,12000 co-operative credit societies at village level.
There is at least one retail credit outlet on an average for about 5000 rural people or every
1000 households. This is an extensive and remarkable network that is present no where in the
world and is capable of meeting the financial needs of the entire rural population.

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 A most notable milestone in the SHG movement was achieved when NABARD
launched a pilot phase of the SHG bank linkage programme in February 1992. This was the
first instance of mature SHGs that were directly financed by a commercial bank. The
informal thrift and credit groups of poor were recognized as bankable clients. Soon after , the
RBI advised commercial banks to consider vending to SHGs part of their rural credit
operation for crediting SHG bank linkage with linking of SHGs with the low income
households, transaction cost were low and repayment rules were high. The SHGs were able to
scale up their operations with more financing and they had access to more credit products.

Under the SHG –bank linkage programme in 2004, 16.7 million poor house holds
were accessing credit through 35,000 branches of 560 commercial and co-operative banks.
The government of india made linking SHGs with banks a national priority from 1999 and
NABARD continuous to nurture the expansion of the outreach of the programme by
providing umbrella support to various state holders. The programme is growing at a pace of
about 2.5 million house holds annually. It is the largest and fastest growing micro finance
programme in the world in terms of the outreach and sustainability.

WOMEN SELF-HELP GROUP

One of the powerful approaches to women empowerment and rural entrepreneurship

is the formation of self help groups (SHGs) especially among women. Women self –help
groups are increasingly being used as tool for various developmental intervention. Credit and
its delivery through self-help groups have also been taken as a means for empowerment of
rural women.

The SHG approach has proved successful not only in improving the economic
condition through income generation but in creating awareness about health and hygiene,
sanitation and cleanliness, environmental protection ,important of education and better
response for development schemes.

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 Through organizing informal self-help groups (SHGS), rural women in india are
provided credit and extension support for various production –oriented income generating
activities. SHGs are self –governed, with decisions about production and marketing taken
collectively, although the group leader is responsible for identifying potential marketing
centers and consumers . these groups represent a new culture in rural development , breaking
with traditional bureaucracy and top-down management. Informal groups empower rural
woman to manage rural industries and make decision collectively for their common economic
interests. Informal self-help groups in rural areas serve to empower women and provide a
basis for the provision of credit and other support for various production and income –
generation activities.

According to the survey conducted by centre for bharatiya marketing development

(CBMD), highest number of SHGs are found in the southern states on an average southern
states constitutes 65% SHGs, eastern 13%, central 11% ,northern 5% and western 6% at the
national scene. Andhra Pradesh ,followed by Tamilnadu , has the highest number of woman
SHGs working independently and setting up a micro enterprise, which help in income
generation.

The most identified self help groups role in empowerment of woman are:

A) The SHGs provide the poor woman the access to economic resources like money and
here by they enable the woman to spend them on productive and consumption needs.

B) The SHGs enable the women to participate in decision making on economic and
financial issues like family financial needs, supplementing of family income, rising of
loans , sale and mortage of assets.etc.

C) The SHGs enhance the economic and social status of women at family and society
level.

D) The groups change the women from house keeper to organiser, manager and decision
maker.

E) The SHGs enables the women to participate in social- political decision- making at
local level through their participation in village gramasabha ,panchayat meeting and
political activities

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F) The groups change the outlook of the woman

SHGs –An alternative strategy for rural development

When individuals act at as a thematic level in a conglomeration on their own

initiative in an attempt to meet their individual and common needs with primary focus
on self reliance we call them a SHG self help implies a step further from the stage of
passivity to activity and of making creative contribution. A common bond like cast
affiliation community or place of residence or activity links the individuals.

The SHGs are voluntary association of rural poor people, homogeneous

autonomus and non- political formed to achieve collective, social and economical
goals. People came together and function as a group around some need, which
furthers their common interest. These groups are organised by themselves or by an
NGO or a self help promoting institution. The SHG is not a state institution it grows
on the resources and management skills of its members and their increasing
confidence to get involved in the issues and programmes that require their
involvement in the public and private spheres.

The SHGs provide the benefits of economics of scale, cost effective alternative
for different financial resources, collective learning, democratic and participatory
culture ,a firm and a plat form for dialogue and cooperation. Moreover , the benefits
of SHGs are based ion cooperation rather than competition. It follows the real
principle of “contribute according to your ability and extract according to your need”.

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 In recent years SHGs have become significant institutuion for rural development ,
particularly in the case of rural people.

FEATURES OF SHG

1) LENDING:-

Lending among themselves out their savings is an important aspect of

group functioning. Members request for loans in the meeting. The group
discusses the loan request of members and decisions are taken by consensus.
Since they live close to each other, the members have intimate knowledge of loan
requirement, genuineness demand and also repayment capacity of each member
which facilitates decision making. The nominal rate of interest ie, 2% to 3% per
month. The repayment period of loan vary from group to group and the groups
are very strict about the repayment of loans.

2) Peer pressure :-

The unavailability of fund with the group is not enough to satisfy the
demands of all the members at a time. Thus the members who have availed the
loans are always under pressure to repay so that other member’s requirements can
also be fulfilled. So that the intimate knowledge about the members and peer
pressure helps in very good recovery of loan

3) Fines :-

The groups levy fines for instilling discipline among the members. Fines
are collected for not attending meetings , saving irregularity and failure to repay

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 the loans . some of the groups levy fines for even smoking, pan chewing etc.
some groups levy fines for talking during meetings and walking out of the
meeting half way through.

4) LEADER SHIP :-

2 OR 3 members are chosen by the group members as leaders. The

responsibilities of the leaders are to convene the meetings , maintenance of books
of accounts , conflict resolution among members , accounting for cash and also
dealing with banks and other outside agencies. The leaders are trained by the
NGOs to carry out their duty regularly and effectively. The leaders are rotated
normally once in a year in order to develop leadership among all the members.

5) Maintenance of records:-

SHGs are trained by the NGOs in maintaining proper books of accounts

regarding working of groups. The details of the records maintained by the groups
are proceedings in the meetings, attendance , savings , loans and repayment and
other activities of the groups. In case of fully illiterate groups the members
depend on NGOs, outsiders or any educated relatives of the members to maintain
books.

6) Participatory decision making:-

The groups normally discuss thread bare the various agenda put forth in a meeting
and take decisions. Open trancsactions are encouraged and mobilization of savings, collection
of loans installment and disbursement of loans are carried out in the groups meetings to
ensure openness and accountability.

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 7) Common fund:-

The common funds of the groups consiost of membership fee if any, savings of
members , fines, interst on loan and interest earned on deposits with the banks . some NGOs
have a system of contributing seed money assistance to the groups in the initial year for
augmenting their resources for internal lending. Such assistance is usually a grant, which is
repayable after the specified period.

8) Linking with banks:-

The groups open saving bank account with the banks for depositing
their savings. The leaders usually operate the account for depositing savings ,
loans repayment.etc. and for withdrawal. Some NGOs insist that other members
in turn should insist the banks for bank dealing so that all in the group inculcate
the banking habit. The groups are eligible for bank loans on completion of six
months of their existence and successful conduct of meetings collection of
savings and inter loaning.

After the introduction of financial sector reforms in 1991 in india , lending to the poor
especially to the priority sector had suffered with banks reducing the small –loan accounts
and showing less interest in lending under the programs. Instead ,banks were enthusiastic of
keeping the short fall in priority sector lending in RIDF scheme.

In india the NABARD and RBI has actively promoted it by providing increasing
funding to micro finance institutions (MFI). Under the NABARD’s self help group bank
linkage model (which is different from the grameen bank model), SHGs bring together about

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10-20 women who pool their savings for after months allocate them to members who need
small amount temporarily this making them eligible for a bank loan.

In india , a number of self help groups (SHGs )were created in the 1980 ‘s for providing
credit facilities to the poor , especially women , in both urban and rural areas.

TABLE 3.1 :-Progress of SHGs and distribution of micro credit as on 31st

march 2005 (Rs.in million)

CUMULATIVE CUMULATIVE
NO .OF SHGs NO.OF BANKS
SI.NO REGION PER CAPITA
BANK LOAN UP
ST
LOAN UP TO 31ST CREDIT PER
TO 31 MARCH
MARCH 2005 SHG
2005
SOUTHERN REGION
1 Andhara 492,927 27460.93 55709.9
pradesh
2 Karnataka 163,198 5501.53 33710.7
3 Kerala 60,809 2495.53 41038.8
4 Tamil nadu 220,698 16,779.00 76026.9
5 pondicherry 1,309 184.43 140893.8
Total 938941 52421.42 347380.1

CUMULATIVE NO CUMULATIVE PER CAPITA

.OF SHGs BANK NO.OF BANKS CREDIT PER
SI.NO REGION
LOAN UP TO 31ST SHG
LOAN UP TO 31ST
MARCH 2005
MARCH 2005
NORTHERN REGION
6. Himachal
Pradesh

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 17798 565.03 31746.8

7 Rajasthan 60,006 1414.04 23564.9

8. Haryana 3,351 200.63 59871.6
9. Punjab 3091 145.76 47156.2
10. Jammu&
kashmir
1647 56.58 3453.38
11.

New delhi 125 13.14 10512

Total 86018 2395.18 207204.8
NORTH –EASTERN REGION
12. Meghalaya 249 7.78 31244.1
13. Tripura 1515 19.07 12587.4
14. Sikkim 42 1.35 32142.8
15. Manipur 796 30.10 37814
16. Arunachal 280 11.97 4275
Pradesh
17. Nagaland 94 4.69 49893.6
18. Mizoram 28 2.84 101428.5
Total 16440 453.58 2627.92

CUMULATIVE CUMULATIVE PER CAPITA

NO .OF SHGs BANK NO.OF BANKS CREDIT PER
SI.NO REGION ST
LOAN UP TO 31

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 MARCH 2005 LOAN UP TO 31ST SHG
MARCH 2005
EASTERN REGION
19. Orissa 123,256 2517.94 20428.5
20. Bihar 28,015 681.86 24339.1
21. Jharkhand 21,531 714.73 33195.3
22. West 92698 1262.77 13622.4
Bengal
23. Ut of AN 128 5.76 4500
islands
TOTAL 265628 5183.16 96085.3
Central region
24. Madhya 45,105 1,110.77 24626.3
pradesh
25. Chattisgarh 18,569 171.95 92605.7
26. Uttar 119,648 3155.79 26375.6
Pradesh
27. Uttranchal 14,043 579.05 41020.4
Total 197365 5014.56 184628
Western region
28. Gujarat 24712 686.44 2777.5
29. Maharashtra 71146 2234.11 31401.7
30. Goa 408 30.22 74068.6
Total 96266 2950.77 133247.8
Grand total 1600658 68421.57 1236338.7
(source :www.NABARD .com)

The above table clearly shows that there are vast credit variations among the stated and
among the regions. Among the regions, southern region is the best region in financing SHGs.

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In the southern region 52421.42 million Rs distributed among SHGs. Next to that
performance of central region, eastern region and western region is moderate and the credit
distributed to the region as 5014.56, 5183.06 and 2950.77 million Rs respectively poor and
they have distributed 2395.18 and 453.58 million Rs respectively. While considering the
number of groups the region southern, central region, eastern region have enrolled more
SHGs.

Other region enrolled less SHGs. With the help of credit per SHGs one can understand the
progress of SHGs . One can understand the progress of SHGs among the regions and states.
Among the regions distributed more credit per SHGs are very high. While considering the
states among the region Pondicherry and tamil nadu states are performing well and had
distributed more credit. In central region chattisgarh state distributed more credit and per
capita credit calculated at 92605.7 copies. In western region Goa state per capita credit is
high and calculated at 74068.6 Rs and in the northern region Haryana and Punjab states per
capita credit is very high and calculated at 59871.6 and 47156.2 Rs respectively. Eastern
region and north eastern region per capita credit per SHGs are up to level and Mizoram, the
only state in north eastern region, recorded 101428.5 Rs per capita credit distributed to the
SHGs.

SHGs and microfinance:-

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 SHGs means small, economically homogeneous and affinity groups of rural/
urban poor , voluntarily formed to save and contribute to a common fund to be lent to its
members as per group decision and for working together for social and economic uplift meant
for families and community.

Micro finance in india.

TABLE 3.2:- Micro finance in india

Bank

Cumulative number of disbursement per SHGs provided bank loan SHG in

lakhs
Public sector Up to Mar 01-02 Up to Mar 04 During 2001-02 During 2003-04

Banks 118855 516697 0.020 0.057

Private sector 5391 21725 0.051 0.155

banks

Regional rural 84775 405998 0.023 0.013

banks

Co-operatives 12773 134671 0.019 0.036

Total 221794 1079091 0.021 0.051

(source : NABARD,2004)

This table shows that number of SHGs having been financed by FFI s has increased from 0.2
million in2001 to 1.1 million in2004 at the rate of 128 percent per annum. Number of SHGs

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financial during a year has increased from 0.26 million in 2001-02 to 0.36 million in 2003-
04 .In 2003-04 with an annual growth of 19.8 percent.

Growth of the SHG –bank linkage programme in india -1999 -2005

The SHG bank linkage model was introduced in 1991-92 with pilot project of linking
500 SHGs with banks which increased to more than 16 lakhs by end of march 2005.
Cumalitively, these SHGs have accessed credit of Rs 6,898 crore from banks during the
period about 2.4 crore per households have gained access to the formal banking system
through the programme. During the last six years the number of SHGs linked to banks has
gone up from 32,995 during 1998 to 16,18,476 during 2004-05. This is shown in the above
diagram,

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 Not with standing the remarkable progress, geographically these has been a skewed
development of SHG bank linkage programme in india. It has been observed that the
programme has been more successful in southern states alone accounted for 31 percent of the
total linkage at the end of march 2005, while the northern and north- eastern region together
accounted for just 7.4 percent of the total programme.

CHAPTER -4

ROLE OF SHG IN KERALA

Since 1970, the india government has implemented a number of programmes designed to
eradicate poverty which have made an impact on poverty. Poverty alleviation can be achieved
along with a reduction in spatial and gender gaps the two important gaps that are quite
prominent in the development experience. The formal refers to the gap between rural and
urban areas; the latter refers to the gap between men and women. Kerala experiences shows
that while the rural- urban gaps quite narrow, there are a number of indicators where in
women perform as well as men or even better.

The failure of some anti poverty programme in the part can be attributed to the fixation
of target, lack of involvement of beneficiaries absence of poor under standing of poverty and
its cause and manifestation, the top down approach seeking to achieve a break in
participatory poverty reduction through kudumbashree, which is implemented by the state
poverty eradication mission through the local self government institution. All urban local
governments and village panchayat have been included under kudumbhashree.

Microfinance is being used as a major tool for poverty eradication. The kudumbhashree
mission follows a simple model of microfinance to facilitate easier availability and better
utilization of loans for poor people.

The kudumbhashree program in kerala comes under the bank SHG model where social
intermediatory is a state government entity. The kudumbhashree program is classified as a
neighbor hood group (NHG). The main difference between SHG and NHG is that SHG are
non governmental informal organization promoted by voluntary agencies. NHGs are
promoted by the government for the upliftment of the poor by bringing the activities of

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various departments into one umbrella. The kudumbhashree programme is co-sponsored by
the government of kerala, local bodies and UNICEF.

Kudumbhashree is a woman –central initiative against poverty that has been in

poverty that has been in operation in the state of kerala since 1998 in rural areas and since
2000 in urban areas. The community development societies(CDs) system act as a subsystem
of the local government (panchayat and municipality and takes a de-centraliastion of power
further down to the grass root level. The program was initially implemented in 13 towns in
the district of alleppey, ernakulam, and later extended during the eight or five years plan to 16
more towns and then to the entire malapuram district.

TABLE.4.1:-PROGRESS OF KUDUMBHASHREE PROGRAM IN KERALA;1999-06

SI.NO No. of No. of No. of Informal Amount of Velocity of

NHGs ADS families amount of loan (in internal
covered thrift lending
million
Rs)
1999-2000 7,538 - - 883.9 561.4 0.63
2002-03 1,13,675 13,423 22,10,033 1,634.9 1,695.9 1.04
2003-04 1,25,735 13,766 16,45,369 2528.3 31925.6 1.55
2004-05 1,47,989 13,262 29,23,425 5,330.1 13,078.7 2.45
2005-06 1,67,907 14,574 33,81,764 6,640 15,352 2.30

SOURCE; kudumbhashree, annual report (various issues).

This table shows, over the years, number of NHGs created under kudumbhashree program
has raised from 7,538 in 1999-2000 to 1,67,907 by 2005-06. The amount of thrift collected
from house holds has increased from Rs 884 million to Rs 6,640 million during the same
period. The velocity of internal lending from 0.63 in 1999-00 to 2.3 in 2005-06.

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Community based organization for poor people

Kudumbhashree promotes thrift mobilization by setting up thrift and credit

societies at NHG level to encourage the poor to save and to provide them cost effective and
easy credit. Thrift and credit societies facilitate easy and timely credit to the unreached. The
amount of loan and the priority of disbursement are decided by the NHG. The repayment is
collected weekly during the routine NHG meetings.

TABLE4.2:- DISTRICT WISE DETAILS OF COMMUNITY BASED

ORGANIZATION

SI.NO DISTRICT NO.OF TOTAL THRIFT (Rs) THRIFT

GPS NHGs LOAN(Rs)

1. Thiruvananthapuram 78 19,341 1,35,68,07,151 3,14,51,92,772

2. Kollam 71 12,444 80,93,76,958 1,82,80,55,476
3. Pathanamthitta 54 6,729 39,98,72,989 69,58,31,943
4. Alappuzha 73 13,809 99,39,28,937 2,42,51,26,540
5. Kottayam 75 11,277 66,14,41,003 12,72,20,089
6. Idukki 52 9,688 76,88,41,776 17,93,36,16,629
7. Ernakulam 88 14,187 85,34,77,995 3,47,48,70,074

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 8. Thrissur 92 15,745 78,58,24,840 3,27,23,16,062
9. Palakkad 91 20,653 1,30,31,80,741 3,63,81,85,438
10. Malappuram 102 15,482 1,04,99,29,317 1,61,71,59,435
11. Kozhikode 78 15,309 11,87,29,317 33,82,43,158
12. Wayanad 25 7,731 45,60,27,956 1,45,16,20,517
13. Kannur 81 11,419 84,29,06,576 2,95,79,59,833
14. Kasargode 39 6,225 46,18,28,167 1,91,24,05,979
Total 999 1,80,039 11,93,07,35,665 32,82,25,48,945
(source: kudumbhashree, Govt of Kerala)

Linkage banking

The bank linkage programme has helped the NHGs to augment their existing
resources collected through thrift. The cumulative amount which has been lent to NHGs
under linkage banking is Rs 8,05,50.76 lakhs and number of NHGs that have borrowed from
banks atleast once are 1,08,032 (as on September 2009.). district wise details are given
below.

TABLE 4.3:- District wise details linkage banking as on september2009.

CUMULATIVE

SI.NO NAME OF DISTRICT NHGs linked Amount (Rs in

lakh)
1. Thiruvananthapuram 13057 10569.46
2. Kollam 11536 10692.09
3. Pathanamthitta 3017 3716.19

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 4. Alappuzha 11602 7636.20
5. Kottayam 4873 3705.14
6. Idukki 6159 6915.54
7. Ernakulam 11249 5964.95
8. Thrissur 9131 6638.71
9. Palakkad 13431 7882.02
10. Malappuram 5832 2643.01
11. Kozhikode 5843 3536.21
12. Wayanad 5400 5909.29
13. Kannur 3135 2669.48
14. Kasargode 3767 2052.53
Total 108032 80550.76
(source:kudumbhashree, Govt of Kerala)

Lease land farming (LLF)

LLF is introduced to improve the livelihood of poor families in the neighborhood

groups and increasing the agricultural production by bringing fallen and cultivable waste land
into agricultural use. The programme is implemented in all the district with the support of
LSGs. The activities include distribution and of inputs and release of incentives.

Rural microfinance enterprises (RME)

RMEs is specially designed for providing self employment assistance to women

belonging to rural areas started during the financial year 2001-02. The minimum number of
people required for a group enterprises is five. In the case of individual enterprise, maximum
subsidy admissible is Rs 7500/- or 30% of the project costs which ever is less.

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Linkage with banks

The role of NABARD in the growth of SHGs in kerala is worth mentioning. Besides the
financial support, their guidance in group formation and imparting of training in leadership,
maintenance of record, book keeping and accounts, have given a sound footing to many
SHGs. Their timely intervention has provided the much needed stability to the thrift
initiative. Formation of SHG and their linkage with banks in the state have taken place on
two fronts.

(1) Through the CDs, formed with the support of stay government, local administration.
NABARD,UNICEF, and banks.

(2) Through efforts of voluntary agencies and banks under the leadership of NABARD.
Farmers clubs promoted (under a programme called ‘ vikas volunteer vahini,) by
NABARD have promoted SHGs too.

NABARD has stipulated certain norms for linking SHGs to bank credit such as
the following:

(1) The group should have been in existence for at least six months: and
(2) The group should have scored 120/150 marks based on its evaluation criteria.

Once the groups are linked to the scheme, in the first stage they become
eligible for credit equal to their thrift. Subsequently repeat loans may be availed at
the thrift- credit ratio of 1:2 and 1:4 depending on the repayment performance of
the groups concerned. These provisions are seen to motivate members to exert
peer pressure for prompt repayment.

Kerala remains the third largest in the country next only to Karnataka and
Andhra Pradesh, in the matter of the number of linked groups and accounted for
13 percent of the total linked groups in india in 1999. The linkage programme
involved 47 agencies promoting self help (kerala state focus paper,NABARD
1999-2000) of which 41 were NGOs and 6, vikas volunteer vahini.

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 SL.NO YEAR NO.OF SHGs Bank loan (Rs Loan per SHG(Rs)
linked in lakh)
1 1994-95 352 13.02 3698.90
2 1995-96 402 21.96 5462.70
3 1996-97 536 52.37 9770.50
4 1997-98 536 78.97 14733.20
5 1998-99 1291 223.70 17327.70
6 1999-2000 2434 565.48 23232.60
Total 5551 955.50 17213.20

(source:NABARD 2000)

Figures showing the year wise growth of bank linked SHGs in the state indicate the
success of the programme in kerala . The number of self help groups increases from 352 in
1994-95 to 2432 in 1999-2000, recrding a growth of around seven times, over a period of five
years. Similarily the flow of bank credit to these groups: which had been Rs 13.02 lakh in
1994-95 went upto the tune of Rs 565.8 lakh during the same period .

CHAPTER-5

ANALYSIS

The areas chosen for the analysis is Ambalapuzha panchayat. In this respective area
almost ten kudumbhashree units were taken as the sample unit. Each group consisted of 15 to
20 members. With a total of 178 members. Data was collected with the help of

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questionnaire. The survey reveals the relevant information regarding the economic, political,
and social back ground of beneficiaries.

TABLE 5.1:-NUMBER OF MEMBERS IN THE GROUP AND NATURE OF ACTIVTY

SIZE OF THE NATURE OF ACTIVITY

GROUP
SL.NO Name of SHG

1 POURNAMI 18 AGRICULTURE

2 SOUBHAGYA 15 AGRICULTURE

3 SURYA 20 NON AGRICULTURE (SOAP

MAKING)

4 AKSHAYA 17 PICKLE

5 MAHATMA 19 MAKING SOAP POWDER

6 DEVI 20 AGRICULTURE

7 SURABHI 18 SOAP MAKING

8 DURGA 16 MAKING VATALS

9 JAYALAKSHMI 20 MAKING JAMS, SWEETS

10 SREEDEVI 15 AGRICULTURE
(SOURCE: PRIMARY SURVEY).

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 It is clear from the table that out of 10 SHGs about 3 have 20 members each, two
groups have 15 members each, other groups consists 18,17,19 members respectively.

Out of 10 groups 4 groups are engaged in agricultural activity and 2 groups are
engaged in soap making, and soap powder making and 1 group engaged in the activity of
jams and sweet making.

TABLE 5.2:-SOCIO-ECONOMIC PROFILE OF THE GROUP

AGE GROUP FRQUENCY PERCENTAGE

BELOW 30 32 18
30-40 53 30
40-50 65 36
50-60 28 16
(SOURCE: PRIMARYSURVEY)

(source: primary survey)

It is clear from the table that highest percentage of sample population belongs to the
age group 40-50. The lowest percentage of sample population belongs to the age group 50-
60. This shows the increasing enthusiasm among the middle – aged people to develop and
improve their standard of living.

TABLE 5.3:-EDUCATIONAL STATUS

SI.NO PARTICULARS NOOF RESPONDENTS PERCENTAGE

1 ILLITERATE 0 0

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 2 UPTO 4 4 2

3 UPTO 8 14 8

4 UPTO 10 71 40

5 SSLC 53 30

6 ABOVE SSLC 36 20

(source: primary survey)

(source: primary survey)

It is been from the table that the kudumbhashree concept is more popular among the
people who are educated at the level of high school. It is not that much the case with those
who are educated at up to 4, and up to 8 and above SSLC level;.

The table also shows that level of education of the respondents is also not very poor.
Majority of the respondents (40%) are educated up to 10 and none are illiterate. This reflects
the 100% literacy rate among the sample population

TABLE 5.4:-RELIGIOUS STATUS

NAME OF RELIGION FREQUENCY PERCENTAGE

HINDU 142 80

MUSLIMS 7 4
CHRISTIANS 29 16
(source: primary survey)

(source: primary survey)

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 The table shows that majority (80%) of the members of the groups were Hindus. Only
4% and 16% are Muslims and Christians respectively. Thus the persons become the member
of the groups irrespective of their castes.

TABLE 5.5:-CASTE STATUS

Name of religion Frequency Percentage

Nair 21 12
Ezhava 71 40
OBC 36 20
SC 14 8
Muslims 7 4
Christians 29 16
(source: primary survey)

(source: primary survey)

The caste status shows the mixed trend of the group. The majority of the members of
group(40%) are ezhava second largest share is made by OBC (20%). Nair includes 12% and
SC includes 8%. Muslims and Christians community constitutes 4% and 16% respectively.
This shows that socially backward classes are more poor compared to the upper classes and
thus they are proposed to participatory in such programmes which would help them to
improve their status.

TABL5.6:-MARTIAL STATUS

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 Martial status Frequency Percentage
Married 142 80
Un married 21 12
Widow 15 8
(source: primary survey)

(source: primary survey)

The table shows that the majority 80% of the respondents was married and about 8% were
widows. Only 12% of the respondents were unmarried.

TABLE 5.7:-Showing respondents by their house type

House type Frequency Percentage

Thatched 22 12
Tiled 64 36
Terraced 50 28
Light roof 42 24
(source :primary survey)

It is clear from the table that majority of respondents (36%) lived in tiled houses. The next
highest percentage of respondents (28%) lived in terraced housed.

TABLE 5.8:-Showing respondents by their indebtedness

NO.OF
RESPONDENTS
SL.NO PARTICULARS PERCENTAGE
01 INDEBTEDNESS:
YES 121 68
NO 57 32

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 02 FROM:-
COOPERATIVE SOCIETIES 14 11.7
MONEY LENDERS 28 23.5
BANKS 32 26.4
RELATIVES 7 5.9
FROM GROUP 18 14.7
FRIENDS 21 17.6
03 AMOUNT;-
UPTO 1000 7 5.8
1000-5000 11 8.8
5000-10000 7 5.8
10000-15000 21 17.6
15000-20000 11 8.8
20000 AND ABOVE 64 52.9
04 RATE OF INTEREST:-
FREE OF INTERST 22 18.8
2-5% 36 29.4
5-10% 42 34
10-15% 21 17.8
05 PAID OFF:
NILL 46 38.2
PARTIALLY 61 50
WHOLLY 14 11.76
(source: primary survey)

The above table shows that the majority of the respondents have borrowed money from
one source to the other. Analyzing the sources from which the respondents have availed
loans, it is clear from which the respondents have availed loans, it is clear that only 23.5%of
the total sample population have borrowed money from bank rest of the 76.5% percentage

Page | 35
have borrowed money from other informal sources. About 23.55 have borrowed money from
money lenders at high rate of interests. About 11.7% of the sample population has borrowed
money from cooperative societies. About 14.7% have borrowed from group. The group
provides loans to its members in emergency situations of their thrift account.

The maximum amount of money borrowed per person range from Rs 20000 and above.
Thyis shows the high indebtedness of the rural poor.

As regards the rate of interest, the table shows that about 34% of the sample population
are paying a high rate at interest ranging 5%- 10%. About 11.7% of sample population are
paying still higher rate of interest the poor poverty. Here there is the necessity to provide
these people maximum credit at minimum interest rate so that they could get out of this
poverty circle.

Lastly about repayment of loans, the table shows that only 11.7% of the sample
population has fully repaid their loan. About 50% have partially repaid and about 38.25 have
repaid nothing, which clearly shows the difficulity of these people in repaying their debts
because of increasing expenditure.

TABLE 5.9:- Showing respondents by their saving habit

Sl.no Particulars No.of respondents Percentage

Before After Before After

Page | 36
1. Savings Yes:20 Yes:50 40 100
No:30 No:0 60 0
2. Place Bank:2 Bank:50 4 100
Post Post 12 12
office:6 office:6
Chit Chit 20 20
funds :10 funds :10
Lic:2 Lic:2 4 4
3. Amount (monthly in Rs) 10-50:1 10-50:5 1.8 10
50-100:3 50- 6 28
100:14
100- 100- 12 24
200:6 200:16
200 and 200 and 20 40
above:10 above:15
(source: primary survey)

But after availing assistance from kudumbhashree the whole sample population s i.e ‘s
(100%) started saving.

Secondly, before availing assistance from kudumbhashree, only 4% were saving in banks
but now about 100% are saving in bank. This reflects the increasing awareness among the
people about the benefits of saving in banks.

Thirdly , before availing assistance from kudumbhashree,onl;y 25 were saving the

amount ranging from Rs. 10 to 50, about 6% were saving the amount ranging from Rs 50 to
100, about 12 were saving the amount ranging from 100 to200. And only 20%were saving
the amount ranging from Rs 20 and above. But after joining kudumbhashree programme
these percentage has increased to 10%, 28%, 24% and 40%, respectively.

The above difference in data before and after availing credit from kudumbhashree clearly
reflects that the programme has tremendously impact on the savings pattern of the people.
Both, the percentage of people who have started savings and the increased tremendously as is
clear from the table.

TABLE 5.10:- showing the respondents family income &nature of employment

Page | 37
Si.No Particulars No.of respondents Percentage
1. Nature of employment
Permanent 36 20
Temporary 89 50
Seasonal 53 30
2. Family income(monthly in Rs)
0-500 43 24
500-1000 57 32
1000-1500 50 28
1500-2000 14 8
2000 and above 14 8
3. Income from kudumbhashree
0-500 29 16
500-1000 43 24
1000-1500 63 36
1500-2000 43 24
(source : primary survey)

The table shows that the majority of the respondents family (50%) earn their livelihood
from temporary employment and about 30% earn their livelihood from seasonal employment.
Only 20% had permenant employment. This shows the irregularity in their income.

Page | 38
 Further only 24% of the total sample population receives a family income monthly
income ranging from 0 to 500. About 32% of respondents family receives monthly income
ranging from 500 to1000, 28% had income ranging from 1000-1500. About 16% of the total
respondents family receives monthly income ranging from above 1500. This reflects the great
difficulty for them to get both ends meet.

TABLE 5.11:-Members participation on assuring leadership

Perception Number Percentage

Interested 78 64
Not interested 43 36
(source :primary survey)

About 36% of the selected members expressed that they were not interest in assuming
the leadership role of their group. The reason for their unwillingness to take up leadership
roles are given.

TABLE 5.12:-Reasons for abstaining from leadership

Factors No.of people Percentage

Existence of social norms 12 10
Lack of confidence 15 12
Lack of knowledge 7 6
Absence of child care facility 10 8
(source : primary survey)

Among the members of the kudumbhashree 10% are not willing to take leadership due to
the existence of the social norms, 12% have lack of confidence and 6% have lack of
knowledge. 8% are unwilling mainly due to the absence of child care facility.

Motivating factors

TABLE 5.13:- MOTIVATING FACTORS

Reason’s No of persons Percentage

Page | 39
 For getting loan 36 20
For promoting savings habit. 71 40
For availing loan and
promoting saving habit
21 12
Family welfare 32 18
Other reasons 18 10

(source : primary survey)

The table shows the reasons given by the members for joining the SHGs. Abut 40% of
them opinion are that they joined the group for promoting saving habit, and 205 were joined
the group for getting loans. 12% of them opinioned that they joined the group for availing
loan and promoting saving ha bit. 18% were joined for families welfare. 10% joined the
group for other reasons.

Group meetings and attendance

The practice of holding regular group meetings is found to build better understanding.
For get solidarity and develop qualities of self help and mutual help among members. All
groups meetings are held on every Saturdays on a week the survey revealed that about 70-90
% of the members attend the meeting regularly. the function arises insist on holding regular
weekly meetings

Thrift

Thrift is a very important indicator of a group’s success because consistent growth in

thrift as a clear indication of the growing confidence of the members in the group. Collection
of thrift is a major activity of SHGs ,carried out successfully since their instruction in all the
10groups the poor who need money for purchase of various conception goods quiet often
meet their contiguous from borrowing from professional money lenders and others at a high
rates of interest

Page | 40
 SHGs have been extremely effective in creating the habit of savings among the rural
poor and mobilizing it for common good. A fixed amount as decided by the members is
collected as thrift depending the group meeting. The members savings are entered in their
pass books as well as in the savings account maintained in the group.

The amount of monthly savings varied with the socio-economic status of members. In
some groups, members were seen remitting the credit repayment instalment only after
availing loan from the group. There are instances where members had left the group because
they felt that the thrift collected in the weekly meeting were not deposited by the leaders in
the bank, but were rolling it for other purposes. In some groups, 10 percentage of amount
collected is deposited in the credit union and the balance is distributed to the members as loan
on priority basis. The process of lending right from the inception is a peculiarity of this
group. In some group, the imposition of penalty for non-remittance of weekly thrift has
ensured prompt thrift contribution.

Credit

The success and effectiveness of intermediatories like SHGs is determined largely by the
extent to which they have been able to create for the their members a reliable and easy source
of borrowing for household and productive purpose. The SHG strategy has helped these
members who are from the weaker sections to gain easy access to institutional credit. For the
formal credit agency, lending with minimal transaction cost and reaching a large number of
poor with assured repayment, sounds great in the present context of the declining credit –
deposit ratio in the state. Besides the monetary element, the lending operations enable the
groups to learn the way prioritizing and identifying their felt needs, enforcing credit terms
and conditions, and monitoring loan utilization and repayment.

The kudumbhashree unit provide credit at low rate of interest. The members takes loans for
their children’s marriage for funeral, medical treatment and repayment of debt.etc.

TABLE 5.14:-Membership’s perception about factors contributing group success

Contributing factors No. of persons Percentage

External factors
Promoting agency 32 18
Bank 21 12
Coordinator 36 20

Page | 41
 Multiple purpose 11 6
Internal factor
Good leadership 18 10
Transparency 25 14
Multiple response 7 4
All the above factors 28 16
(source :primary survey)

This table shows member’s perceptions on factors behind group success. It come out that
the role of coordinator and promoting agency are the most important external factors
contributing to the success of the group. Around 38% of the members interviewed feel that
the promoting agency and coordinator had a crucial role in the initial years till the group
reach the stage of self sufficiency.

While considering the internal factors, contributing to groups success, 16% of the
members, irrespective of groups, remarked that good leadership, co-operation among
members, transparency in decision making are essential for the smooth functioning and
sustainability of the group.

TABLE 5.15:-Awareness level

Awareness level Will To some Not

aware(percentage extent(percentage) aware(percentage)
)
Govt scheme/ 80 8 12
programme
Health /family welfare 50 40 10

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Skill development 70 30 -
Banking transaction 40 30 30
Local planning 20 60 20
Legal aspects 12 48 40
(source :primary survey).

Most of the group members are well aware of government program and health welfare
programme. Their skills are developed after the membership of the kudumbhashree only 20%
of the people are available of the local planning.

Impact on empowerment
TABLE 5.16:-Analysis impact on empowerment
Type indicator Level at which impact on empowerment may be assessed

1. Increase in savings.
2. Increase in income.
3. Increase in assets.
4. Repayment rates &repeat loans.
Economic 5. Skill development.

1. Increase in self confidence.

2. Change in attitude to women’s role.
Social 3. Improvement in communication skills and in social outlook.

1. Increase in participation in political process.

Political/legal 2. Removal of legal discrimination against women.

Difficulties faced

Page | 43
 Every business enterprises would have to face certain difficulties during its initial
stage until it becomes as well established one. It is case with these unit.

(1) Lack of cooperation among the members is still exist in the group. Members
should be broad minded, trustworthy and hard working people. But what has been
seen is that some members in some groups are not sincere and do not perform the duty
entrusted to them with full responsibility. This causes serious difficulties to other
members of the group as the consequences of such deds are to be faced by the group
collectively especially when it is a group activity.

(2) Unit lost fixed by the bank is still another major serious problem. When
compared to the present cost of living this unit cost are very in adequate thus putting
the beneficiaries into further debt.

(3) High cost of raw materials is still another major problem.

(4) Lack of transporting facility is another problem.

(5) Only the group leader has the complete knowledge and awareness about the
details of the schemes, like the unit lost,rate of interest.etc. it seems to be a demerit
with regard to the better functioning of the group.

CHAPTER-6

MAJOR FINDINGS AND SUGGESTION

Page | 44
The present study attempts to find out the relative progress connected to the empowerment of
women through kudumbhashree. The data required for the particular study are collected from
Ambalapuzha Gramma panchayat. This study is conducted among the 178 groups
beneficiaries of kudumbhashree in ambalapuzha panchayat. The idea was to studt the various
effects of implementation of kudumbhashree programme and also to find out the problems
faced by the respondents in availing this scheme. The major findings of the study are as
follows.

1) Almost all the sample kudumbhashree formed with an emphasis on self –help and
with a view to promoting objectives like freedom from exploitation, economic
improvement and rising for development.

2) The sample self help group (kudumbhashree ) came into existence with a new culture
and a system of collective existence.

3) The data analysis shows that highest percentage of sample population belonged to the
age 40-50.

4) The kudumbhashree concept was most popular among those who were educated up to
10.

5) Saving habit was very low among the respondents before joining kudumbhashree
.but after joining kudumbhashree saving has tremendously increased and all the 100%
of the sample population have started savings.
6) The study area is a Hindu dominated locality. Majority respondents belonged to
Hindu community.

7) Majority respondents had a temporary and seasonal employment. Only 20% of

respondents were permanently employed.

Page | 45
8) Majority of the respondents lived in terraced and tiled houses.

9) Indebtedness was present inmost of the respondents and that too at high rates of
interest before availing assistance from SHG unit. However some of them have fully
repaid their debts and some are in the process of repaying.

10)The total income or profit from kudumbhashree unit was estimated to be ranging from
500-1000. Respondents were seemed to be very optimistic because according to them
it would be possible to earn a net profit above 1000,once they fully repay the loan.

11) The obstacle that is mostly present before the respondents in utilizing the scheme is
inadequate unit cost , short repayment period and lack of transporting facilities.

12) Most of the respondents were satisfied about the functioning of the scheme. A
majority of them believe that some positive changes in their economics and social
status have been brought about through the scheme.

13) Many groups have under taken diversification activity eg. Doing more than one
business such as soap making, soap powder making and jam and sweets making.etc.

14)SHG is emerging as an important activity for the banks in mobilizing deposits from
the rural poor people and giving credit to the rural poor it is important to note that
banks are able to extend credit to the rural poor with any security.
15)A part from including saving habit among the members , the SHGs made effective use
of common funds for causing emergency loans and consumption loans covered
subsistence needs, health care, social ceremonies .etc.

16) The internal loans were generally provided on the basis of trust in the borrowing
members without any legal paperwork and security

17) One aim of the SHGs was to elevate women to a central position in the development
process and to create a mechanism that would allow them to participate in decision
making at the village level in all activities that affected their community. Thus self
Page | 46
help groups fostered a sense of group solidarity, responsibility and collective response
to problems.

Suggestions

Some of the suggestions for the promotion, growth and sustainainability of the
progamme are:-

1) The present limit of the subsidy and unit cost should be increased suitably. It was
found that the fund allocated for the schemes along with the other factor like
subsidy, unit cost etc. being fixed a long time ago, were not sufficient considering
the present cost of living. Thus the present allocation of funds kudumbhashree
should be substantially enhanced to cover the like in price.

2) Lack of transporting and marketing facility and high cost of raw materialization
other required things are serious hundurances in the development of the activity.
Hence steps are to be taken to make provision for supply of raw material to such
people at cheaper rate. Steps are also taken to provide adequate marketing and
transporting. Facilities to these people.
3) The proper selection of activity for the ‘group’ is crucial for its survival and
expansion.

4) The amounts being made available to the units for starting these activities are, in
general, in adequate. Banks are hesistant to release the required amount in the first
installments. The bank retains a portion of the sanctioned funds for release in

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 later installment or for fear of default in loan repayment by members.unless the
bank disburse sanctioned funds liberally to units that have selected through
activities, the scheme will find it difficult to progress.

5) Certain activities require intensive,long period of training. It is also found that

little arrangements exist for monitoring implementation and retraining. Training
should be given in keeping accounts, procurement of raw materials and making of
output.

6) The overall responsibilities of overseeing and guiding the activities of the units
vest with the group organizer. It is essential that the group and possess the
competence to manage and guide activities efficiently.

BIBLIOGRAPHY

1) ABHIJIT SHARMA;- MICROFINANCE: HOPE FOR THE POOR:- YOJANA:-

DECEMBER 2006.

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2) DR.AMRIT PATEL:- EMPOWERMENT OF RURAL WOMEN CONCERN

AND COMMITMENT OF ELECTED WOMENREPRESENTATIVES:-

KURUKSHETRA:-JUNE2010.

3) ARJUN Y PANGANNAVAR- WOMEN SHG PROGRAMME AND RURAL

POVERTY: A MICROSTUDY:- SOUTHERN ECONOMIST-JUNE2010.

4) ARJUN Y PANGANNAVAR;-RURAL DEVELOPMENT WOMEN SELF HELP

GROUP:-SOUTHERN ECONOMIST:-MARCH 2009

5) ARUNDHATI CHATTOPADHYAY:-EMPOWERING WOMEN :YOJANA:-

OCTOBER 2006.

6) .DEVELOPMENT-REPORT,AMBALAPUZHA-BLOCK,PANCHAYATH

(PEOPLES PLAN 2005)

7) ECONOMIC REVIEW 2009.

8) JAYA.S .ANAND – “SELF HELP GROUPS IN EMPOWERING WOMEN”.

9) DR.P.LOGANATHAN AND ASOKAN-“INTER REGIONAL DEVELOPMENT

OF SHGs IN INDIA”- KURUKSHETRA –SEPTEMBER 2006

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10) SUSHAMA BAVLE:- REFLECTION OF SELF-RELIANCE OF RURAL

WOMEN IN THE ENTERPRENEURIAL WORLD:- SOUTHERN ECONOMIST

, OCTOBER 2009.

11) LOCAL SELF HELP GOVT-DEPATMENT GOVT OF KERALA (2009):HAND

BOOK FOR LOCAL.

12) SURENDER AND MANOJ KUMAR:-SHGs AND THEIR IMPACT OF

EMPLOYMENT GENERATION:-SOUTHERN ECONOMIST:-APRIL 2010

13) VALSALAMMA ANTONY-“EDUCATION AND EMPOWERMENT – THE

KEY TO WOMEN EMPOWERMENT, KURUKSHETRA, FEBRUARY,2006.

14) RAKA GUPTA & DR.BIPIN KUMAR GUPTA:-ROLE OF WOMEN IN

ECONOMIC DEVELOPMENT:-YOJANA :- OCTOBER-1987.

15) B.VIJAYA CHANDRAN PILLAI ,V.HARIKUMAR “SELF HELP GROUPS IN

KERALA” (KURUKSHETRA VOL:54 JULY 2006)

QUESTIONAIRE

1) Name:

2) Age:

3) Sex:

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 A) Female: B) Male:

1) Educational qualification.
a) Illiterate , b) up to 4 , c) up to 8 , d) up to 10 ,e) 10 and above

1) Religion
a) Hindu , b) Christian ,c) Muslim

1) Caste
a) Forward , b) OBC, c) SC/ST

1) Martial Status
a) Married, b) Unmarried, c) widow

1) Nature of employment
a) Permanent, b) Temporary, c) Seasonal

1) Type of family
a) Nuclear , b) Joint

1) Type of house
a) Terraced , b) Tiled ,c) Tached.

1) Name of the group:-

2) Number of members in the group:-

3) Monthly frequency of meetings:-

a) One , b) two, c) three or more

1) Percentage of attendance

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 a) 50-60%, b) 60-70%, c) 70-80%, d) 80-90% e) 90-100%.

1) Production activities of the group.

a) Agriculture , b)Non agricultural

1) Monthly income of the family

a) 0-500, b)500-1000, c)100-1500, d) 1500-2000, e) 2000& above.

1) Income from kudumbhashree unit.

a) 0-500, b)500-1000, c)100-1500, d) 1500-2000, e) 2000& above.

18) Did you have any savings before joining the member ship in
kudumbhashree., yes /no?

a) if yes, specify the amount.

b) Where did you save?

1) Bank ,2 ) Post office, 3) chit, 4) LIC

19) Details of loan from the bank.

a)1000-5000,b)5000-10000,c)10000-15000,d)15000-20000, e)20000&above.

20) Loan taken and also mention the rate of interest

a) 2-5%, b) 5-10% , c) 10-15%.

21) Promptness of repayment.

a/) very prompt , b) prompt c) delayed, d) default

22) Method of repayment.

a) daily , b) weekly, c) monthly ,d) annually.

23) Drop out from the group:-

a) high b) medium c) low

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24) Are you interested to wed up the leadership of unit. Yes /no?

26) Reason for abstaining from leadership?

a) lack of confidence b) existence of social norms c) lack of knowledge
d) absence of child care facility.

27) Motivating Factor :-

a) for getting loan ,b) promoting saving habit, c) family welfare d) other
factor.

28) Factors behind group success.:-

External:-
a) promoting agencies ,b) coordinator , c) bank, d) multipurpose.

Internal:-
a) Good leadership ,b) transparency, c) multiple reasons , d) all the
above.

29) Are you aware of various govt programme & health programme yes /no?

30) Any changes in socio economic status after kudumbhashree entry yes /no?

31) Are you aware of local planning yes /no?

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