EMPOWERING SHGS AND OTHER CBOS

SHG is a very proven tool for women mobilisation and eradication of poverty to achieve the social, economic development and personal capability improvement among members.  SHG is popular for self management, self reliance for financial improvement; the concept of SHG is “One for all and all for one”.  The main functions of savings and internal rotation and linking with formal financial institutions are gradually reducing periodically due to various reasons.  The savings of SHG is liquidated and shared among its members, within few years from the year of its formation.  With ‘no corpus’, formal financial institutions are not considering lending to them.  Hence, they are forced to get loan from non-formal institutions, at a higher interest rate, thus SHGs are compelled to meet only for distribution of loan amount and recovery of the same.  The basic concepts are forgotten and gradually the groups also may be disintegrated.  Hence, it is essential to revive the SHG movement insisting the basic principles for the longevity of the rural community’s survival and economic development assisted through the following strategic activities,

• To mobilise all women in the villages under the fold of SHGs and to ensure their social economic development
• Encouraging the savings habit of women to ensure better financial management. Providing capacity building training to enhance their credit worthiness and linkage with regular financial institutions
• Support to capacity building and strengthening community based organisations (CBOs). Support to strengthening of the SHG federation
• Propagating the benefits of Insurance cover to all as risk mitigation and risk proofing alternatives.
• Preaching and enforcing the benefits of SHG Panchsuthras (Golden Principles)
• Facilitating financial discipline and supporting audit services. Assisting  enhancement   of Financial Literacy and knowledge
• A Micro credit unit just started for the benefit of SHGs to guide them in federating and bridging their financial flow with other institutions. The Management of Micro credit unit is controlled in a democratic way by forming a Micro credit committee. MCC is a unit of SCAN with membership of SHGs. It is a joint venture of SHGs and SCAN, to help SHGs as alternative/additional financing body, apart from their internal resources and Banks.  MCC will lend to SHGs on non-profitable basis and membership based lending.  Focus is on promotion of livelihood activities only.