Promotion of Self Help Groups Under the SHG Bank Linkage Programme in India

Publication Date: 25 Nov 2002
Published by: National Bank for Agriculture and Rural Development - NABARD
Document Type: Paper

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How can better quality SHGs be promoted to strengthen the SHG bank linkage program in India?

This paper examines the different ways in which Self Help Promotion Institutions (SHPIs) in India promote Self Help Groups (SHGs). It has two main objectives:

• To determine ways of enhancing the efficiency and quality of the SHG poromotion process,
• To identify means of improving the extent and level of financial services to people who do not have access to formal financial services.

• It should promte SHGs at at low cost in a short time.
• The SHGs promoted should include the poor and its benefits should be equatibly distributed. They should be durable, sustainable, able to keep good records and member friendly.

• The banks, particularly co-operatives, should support, and eventually be replaced by, initiatives of SHG members.
• The extent and quality of member-promoted SHGs should be monitored.
• A regular national SHG sample survey should be put in place, to enable SHG quality monitoring.
• Non-management bank staff should be encouraged to promote SHGs.
• Training should include hands-on SHG record keeping and SHG promotion. Training should emphasize on the importance of access versus the cost of finance.