PROJECT ON SELF HELP GROUP BANKING IN INDIA
BACHELOR OF COMMERCE BANKING AND INSURANCE SEMESTER ± V SUBMITTED
IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OF DEGREE OF BACHELOR OF COMMERCE ± BANKING AND INSURANCE. BY NAME: YOGESH VILAS KHOPKAR ROLL NO: 15
PROJECT GUIDE
K.J.SOMAIYA COLLEGE OF ARTS & COMMERCE, VIDYAVIHAR (E). MUMBAI: 400077
K.J.SOMAIYA COLLEGEOFARTS & COMMERCE VIDYAVIHAR (E). MUMBAI-
DECLARATION
I, YOGESH V.KHOPKAR B.COM BANKING AND AND INSURANCE (SEMESTER ±V), ROLL NO. 15 HERE BY DECLARE THAT I HAVE COMPLETED THE PROJECT ON ³SELF HELP GROUP BANKING IN INDIA´ THE ACADEMIC YEAR 2009-10.
THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
SIGNATURE OF THE STUDENT
CERTIFICATE K.J.SOMAIYA COLLEGE OF ARTS & COMMERCE, VIDYAVIHAR (E). MUMBAI-
THIS
IS
TO
CERTIFY
THAT
SHREE/MR.
YOGESH V. KHOPKAR OF B.COM BANKING AND INSURANCE SEMESTER ± V (2009-2010) HAS SUCESSFULLY COMPLETED THE PROJECT ON ³SELF HELP GROUP OF BANKING IN INDIA´ UNDER THE GUIDANCE OF
COURSE CO-ORDINATOR PROF.
PROJECT GUIDE
INTERNAL EXAMINER
EXTERNAL EXAMINER
PRINCIPAL (DR.SUDHA VYAS)
ACKNOWLEDGEMENT
Words fall short to express my deep sense of gratitude towards them all, who have imparted their valuable time, energy and intellect towards the beautification of my project.
I have no words to thank my guide me valuable guidance though out the study.
who has given
I express my sincere gratitude to our principal Dr. SUDHA VYAS for their t heir continuous support and encouragement.
I extent my sincere gratitude to Mrs. my guide for guiding me throughout the t he project and helping me whenever required.
I also thank my College Library for providing me with necessary books and a nd magazines.
Last but not the least; I also thank my friends for their contribution towards the project.
RESEARCH METHODOLOGY S
My project has been prepared pre pared by collection the sources from secondary data. Data is collected by referring some books written by well versed authors, Magazines, journals, specified websites which are relevant to my topic.
INDEX
CHAPTER NO. 1. 2.
3.
TITLE
PAGE NO.
INTRODUCTION - SHG
1
SHG PATH WAYS OUT OF POVERTY IN INDIA
5
HISTORICAL DEVELOPMENT 6
4.
PERSPECTIVE OF POVERTY ALLEVATION IN INDIA
8
5.
ORIGIN OF SHG
10
6.
LINKING BANKS & SHG
15
7.
EFFECTIVENESS OF SHG OF INDIAN CONTEXT
18
8.
SHG MODELS
25
9.
IMPACT OF SHG MOVEMENT IN INDIA
28
10.
CHARACTERISTIC OF SHG
29
11.
FUNCTION OF SHG
34
12.
EFFECTIVENESS OF SHG IN GLOBAL CONTEXT
38
CASE STUDY
44
CONCLUSION
47
13 .
14 .
15.
BIBLIOGRAPHY
EXECUTIVE SUMMARY
There is a mounting hope ope that micr micr ofinance ofinance can be be lar lar ge scale scale pover pover ty ty alle alleviation tool for fo r d decade cades India¶s poor poor h have ave been een le left out of the t he reac reach h of the the bank loans. But out of ne n ecessity and enter nter pr pr ise, ise, those ose lock ed out of the t he banking wor wo r ld ld have ave found a way out. It is calle call ed micr micr ocre ocreditdit- the the ext extension of small loans to individuals wh w ho are are too poor poo r to to qualify for fo r ttr aditional aditional bank , loans, loans, as the they y have ave no asse assets to be be off ered ered as guar gua r antee antee.. In India, India, micr micr ocre ocredit dit has lar lar gely wor wor k ke d only thr ough ough self-he lf-help lp gr gr oups. oups. Globally it is slowly p r oving oving one one of the the most eff ective ctive str str ate ategie gies to remov removee pover pover ty. ty. Banks too are a re shedding hedding the t heiir old r old reluctanc reluctancee to le lend to the poor, poor, and are are looking to tap the t he ex per per tise tise of micr mic r ocre ocredit dit gr gr oups oups to cre c reat atee a ne new mar mar k k et wh which ich has bee been n emph mphatically pr pr oje ojecte cted on the t he curre current nt study.
CHAPTER 1
INTRODUCTION
³No, these women needed opportunity, not charity ± They want Chance, not not bleeding hearts´ hearts´ - Prof. Mohammed Yunns.
See the sort of innocence on their face but have the tremendous courage in their attitude. By saving the part of their little income they have contributed towards the economic development. Now, they are also able to prove their existence in the global context. SHG banking (self Help Group) enable these women to become self independent. But Howww«. And««What is SHG?
So, Lets Proceed to SHG BANKING
Self-help Groups (SHG) SHG
is gr gr oup oup of r of r ur al al poor poor w who have ave volunteere volunteered d to or or ganize ganize thems hemseelve lves into a gr gr oup oup for for
er adication adication of pover pover ty ty of the t he member mber s. s. They They agree agree to save save regula regular r ly ly and conver conv er t thei heir savings into a Common Fund known as the t he Gr oup oup cor cor ps. The member mber s of the the gr oup oup agree agree to use use this common fund and such such other other funds th that they hey may rec receive ive as a gr gr oup oup thr ough ough a common manage management. The gr oup oup for for mation mation will k ee ee p in vie view the following br br oad oad guide guideline lines:
Gener ally, ally, a se s elf-he lf-help lp gr g r oup oup may consist of 10 to 20 per p er sons. sons.
owever, Howe
in difficult are a reas as
lik e deser ts, ts, hills and are a reas as with with scattere scattered d and spar spa r se population and in case cas e of minor minor irr igation igation and disable disabl ed per per sons, sons, this number number may be be f r rom om 5-20. The difficult are a reas as have ave to be be ide identifie ntified by the the
tate State
Level
SGSY
Committee Committee and the the above above rela relax xation in
member mber ship will be b e per mitte mitted only in such suc h areas. reas.
Gener ally, ally, all me member mber s of the the gr oup oup sh should be belong to familie famili es below the the pover pover ty ty line line. owever, Howe
if necessar ssar y, a max maximum of 20% and in exc exce ptional case cases , where esse ssentially
requi require red d, upto a max maximum of 30% of the t he member mber s in a gr gr oup oup may be be tak en f r rom om familie families mar mar ginally ginally above above the pover pover ty ty line line living contiguously with wit h BPL familie families and if the t hey y are acce acce ptable ptable to the t he BPL me member mber s of the the gr oup. oup. This This will help help the familie families of occupational gr oups oups lik e agr agr icultur icultur al al laborer laborer s, mar mar ginal ginal far far mer s and ar ar tisans tisans mar mar ginally ginally above above the pover pover ty ty line, line, or who may have ave been een exclud excludeed f r r om om the BPL list to be b ecome come member mber s of the
Self Help
Gr oup. oup.
owever, Howe
the APL me member mber s will not be b e eligible ligibl e for for the subsidy
under under the sche schem me. The gr oup oup sh shall consist of more mo re than one one member mber f r rom o m the same same family. A per per son son sh should not be b e a member mber of more more than one one gr oup. oup. The BPL familie famili es must active actively par par ticipate ticipate in the manage management and de d ecision making, making, which ich should not or dinar dinar ily ily be be entire ntirely ly in the the
hands of APL familie famili es. Fur Fur ther, APL me member mber s of the the Self Help Gr G r oup oup sh shall not be b ecome come office office bearer s (Gr (Gr oup oup Le Leader, ader, Assistant Gr Gr oup oup Le Leader ader o or Tre r Treasu asurer) rer) of the the Gr oup. oup. The gr oup oup sh should de devise vise a code code of conduct (Gr (Gr oup oup manage management nor nor ms) ms) to bind itse its elf. This This sh should be be in the the for for m of re of regula gular r m meetings eetings (wee (weekly kly or or fo for r tnigh tnightly), tly), functioning in a democr mocr atic atic manner, manner, allowing f ree ree exc exchange ange of vie views., ws., par par ticipation ticipation by the t he member mber in in the the decision making pr pr oce ocess. The gr oup oup sh should be be able able to dr dr aw aw up an age agenda for for eeach ach meeting eeting and tak e up discussion as per per ag ageenda. The member mber s sh should build the t heiir co r cor r pus thr thr ough ough regula regular r savings. savings. The gr oup oup sh should be be able able to colle collect the the minimum voluntar volunta r y saving amount f r rom om all the the member mber s regula regular r ly ly in the gr oup oup mee meetings. tings. The savings so colle coll ecte cted will be be the gr oup oup cor cor pus fund. The gr oup oup cor cor pus fund sh s hould be be use used to advance advance loans to the the member mber s. s. The gr oup oup should de develop financial manage management nor nor ms ms cover cover ing ing the the loan sanction pr pr oce ocedure, dure, re payme payment sche schedul dulee and intere interest st r ate ates. The member mber s in the the gr oup oup mee meetings tings sh should tak e all the the loaning de decisions thr thr ough ough par par ticipator ticipator y de decision making pr pr oce ocess. The gr oup oup sh should be be able able to pr pr ior ior itize itize the loan applications. Fix Fi x re payme payment sche schedul dulees, fix fix appr appr opr opr iate iate r ate ate of intere interest st for for tthe loans advance advanced and close closely monitor monito r tthe re payme payment loan installme installments f r r om om the the loanee loanee.. The gr oup oup sh should oper oper ate ate a gr gr oup oup account pre pref f er er ably ably in the theiir s r ser vice vice area rea bank br br anch, anch, so as to de de posit the t he balance balance amounts le left with with the gr oups oups after after distu distur r bing loans to its member mber s. s.
The gr oup oup sh should maintain simple simpl e basic reco recor r ds ds such such as Minute Minutes book , Atte Attendance ndance regist register, er, Loan le ledger, dger, Gener al al le ledger, dger, Cash Cash book Bank passbook and individual passbooks. 50% of the the gr oups oups for for med in each ach block sh should be be exclusiv exclusiveely for for tthe wome women. In the the case case of disable disabled per per sons, sons, the gr oups oups for for med sh should ide ideally be be disability- spe sp ecific whe when never possible, possible, howe owever, in case case sufficie sufficient number number of of pe p eople ople for for fo for r mation mation of disabilityspe specific gr gr oups oups are are not available, available, a gr gr oup oup may compr compr ise ise of per per sons sons with with diver diver se disabilitie disabilities or or aa gr gr oup oup may compr compr ise ise of both both disable disabled and non-disable non-disabled per per sons sons be below the the pover pover ty ty line line. The unique uniqueness of the thesse gr oups oups lie lies in the the fact th that to a lar lar ge ext extent the they y are are selfsuppor suppor ting ting se s elf-gover lf-gover ning ning or or ganizations ganizations f ree ree f r r om om bure bureauc aucr r atization atization and politicization. The pr oce ocess empower mpower s the the poor poor and and enable nables the them m to contr contr ol ol dire direction ction own de developme lopment by ide identifying the t heiir f r f elt nee needs. ds.
Chapter ± 2 SELF HELP GROUPS; PATH WAYS OUT OF POVERTIES IN INDIA
