SHG stands for Self Help Group in its full form.
A self-help group is a type of informal committee made up of a small number of persons with nearly same socioeconomic circumstances. These individuals have gathered to assist one another and to chart a course as a group or team to improve their overall habitat quality.
Self-Help Groups encourage their members to save aside a little amount of money on a regular basis, which they usually deposit in a bank. These are the SHG’s common funds. After a period of time, when there is enough money, SHGs begin to lend it to their members at a low interest rate.
Features of Self Help Groups
- India is home to the majority of self-help groups. This type of organization can also be seen in other South Asian and South-East Asian nations.
- SHGs are self-managed groups of people from the same village or area who share similar challenges. They collaborate to attain a common goal.
- In India, there are nearly 664,369 villages. The majority of individuals here are affected by poverty, illiteracy, a lack of skills, a lack of formal credit, and so on. Most of the time, it becomes tough for them to deal with it on their own. As a result, they work together as a Self Help Group to solve their situation.
- Initially, a community-known and educated animator assists the underprivileged in forming a Self-Help Group.
- The state government, a local bank branch, and various NGOs provide necessary advice and training to these SHGs.
- Self-Help Groups are usually made up of 10 to 25 persons, mostly women between the ages of 25 and 40.
Major Objectives of Self Help Groups
The following are some of the most important purposes of Self-Help groups.
- Self Help groups focus on constructing operative potential for developing ways of income or employment in the village expanse for the poor and marginalized folk.
- Individuals in SHGs save money and then loan it out to other members of the group at a lower interest rate than informal service providers with similar criteria.
- Self-Help Groups can also acquire low-interest loans from banks if they save regularly, and so serve as a united guarantee mechanism for group members who want to borrow from organized sources.
- SHGs also resolve issues among the inhabitants of the area where they reside through mutual conversations.
- Additionally, Self Help groups aid the underprivileged with microfinance.
Benefits of Self Help Groups
- SHGs encourage their members to save money on a regular basis, promoting banking literacy. It also serves as a means for getting to banking institutions.
- This group empowers women, and by fostering leadership among them, they are combating gender inequity, as well as increasing women’s involvement in gram sabha and elections.
- SHGs also unite to protest social issues such as alcoholism and the dowry system. Furthermore, they become a spokesperson for issues such as poor health care and social injustice.
- These organizations are also using social surveys to improve the effectiveness of various government programs and reduce fraud. As a result, impoverished and marginalized individuals benefit because most government programs are aimed at improving their lives.
Disadvantages of Self Help Groups
The SHGs have a few flaws as well, such as
- Since these organizations are primarily for the poor, they do not always come from the poorest of backgrounds.
- However, while the poor’s social life improves, their economic situation does not improve after joining a SHG.
- The majority of Self Help Group activities are based on basic abilities that are directly tied to the primary sector; as a result, group members do not receive enough value and salaries in exchange for their labor.
- Furthermore, because SHGs are almost always solely reliant on NGOs or other government agencies, they collapse when their funding is discontinued.
Challenges, that SHGs are facing in a country like India
- One of the biggest challenges for Self Help Groups in India is a lack of proper knowledge among SHGs about sustainable and profitable livelihood options.
- In addition, a lack of ability and resources prevents individuals from earning good money through micro-unit businesses.
- Via these SHGs, the Patriarchal Society of India is also fostering resistance to women’s empowerment.
- In addition, SHGs are currently dealing with a significant lack of security and sustainability.
SHGs are one of the most effective instruments for ending rural poverty because they enable impoverished people to access credit and financial services. It also gives women and the impoverished the ability to speak out against exploitation. Despite the fact that SHGs have some flaws and face obstacles, it is considered that these concerns can be resolved with adequate form guidance and government assistance. Self-Help Groups, on the other hand, teach how to work together to solve problems, which is always inspiring for the good of the society.