9
P
roviding banking services to every citizen in our country
which has an overwhelming population under the
“bottom of the pyramid” has remained a major challenge
for the sector. Inspite of several path breaking initiatives,
millions have still remained excluded from financial services. The
situation ismore complex in respect of women. Sincemany Indian
women are involved in homemaking and work in the unorganized
sector, bringing them to the banking fold is very tough. With no
money in their hands, the Indian women are highly marginalized.
The advent of the SHG movement has brought money in the
hands of women and small farmers. It has also brought dignity to
the women folk. They have got a new found confidence and are
today heard in the family. This movement cannot be replaced
by formal banking services in at least the next five decades. As
such, there is a great need to strengthen the SHG movement to
not only empower the women with employability but also to push
up the rural productivity.
Following are the immediate necessities to further strengthen
the SHG movement in our country.
1. Effective digitisation of the SHG member level data. Develop
tracking system for member level transactions so that this
data becomes dynamic. Make this data available to bankers
for taking lending decisions.
2. Aggressively canvas Jan dhan accounts of SHG members
and their family members and link these accounts to SHG
accounts so that the internal group transactions become
completely cashless.
Dr L H Manjunath
ED, SKDRDP
3. Encourage the Business Correspondents/Facilitators in the
SHG sphere and make their activities completely sustainable.
4. Use the SHG as last mile delivery institutions for providing
banking and insurance services to the excluded sector.
5. Aggressively increase credit flow to the SHG sector. Make
available collateral-free, higher funds of upto Rs.10 lakhs to
the members of SHGs for taking upmicroenterprises and build
infrastructure like housing through the SHGmodule. These will
further strengthen the cohesiveness among the members to
provide group guarantee for higher loan amounts.
6. Do away with savings-based credit and start need-based
credit for the SHG members.
7. Develop SHGs as strong competitors to the micro finance
industry.
8. Approach the government agencies to meet the cost of SHG
monitoring services undertaken by the SHPIs.
9. Bring down unwanted subsidies to the capital investments
made by the SHG members.
10.Provide interest subsidy as applicable to such SHG members
who apply the credit received from the SHGs for their micro
enterprise rather than consumptionpurposes. For this purpose
member level borrowing profile needs to be digitised so that
spending for micro enterprises and certain infrastructures are
encouraged rather than just consumption.
