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Success of micro finance movement

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FOR SELF-RELIANCE: Members of Chand Bibi SHG in Bidar learning the art of Zardozi handicraft.
FOR SELF-RELIANCE: Members of Chand Bibi SHG in Bidar learning the art of Zardozi handicraft.

Rishikesh Bahadur Desai

A tenth of the country's self-help groups are in Karnataka

BIDAR: The micro finance movement now recognised by the Nobel Committee as an instrument of lasting peace, has been a considerable success in India too.

The women's self-help group (SHG) model, promoted by Nobel laureate Mohammad Yunus of Bangladesh, has been a great success in this country.

In 15 years, it has touched the lives of 15 per cent of the country's population and improved the lot of more than half the poor families, according to a report by the National Bank for Agriculture and Rural Development (NABARD) on the SHG-bank linkage programme.

"The movement has demonstrated that poverty reduction and empowerment of the rural poor, especially women, can certainly be achieved. Banks and other financial institutions have treated the SHGs as a favourite loan product. The SHG members have begun to appreciate that the resources are limited and have a cost. The other partners in the movement are realising the immense potential SHGs offer for achieving the UNO's goals of health, education and women's empowerment," remarks NABARD Chief General Manager B.B. Mohanty in the report.

According to the report, there are nearly three million SHGs in the country. Around three crore people are members of the programme, hailed as the world's largest micro finance initiative. It is also the fastest growing movement in the world with 400 women joining it every hour.

Around Rs. 10,000 crore has been disbursed as loans to SHGs by commercial, co-operative and regional rural banks and other micro finance institutions. Peer pressure among SHG members to repay is the only collateral security the banks received for these loans.

According to the report, the micro finance through self-help groups has placed 3.11 crore families on the path to self-reliance.

This means half the poor in the country have been benefited in one way or the other by the movement. Karnataka too has been benefited from the movement. It retains its position among the three states where the movement has been effectively implemented. Nearly a tenth of the number of SHGs in the country are in the State.

Till the end of March, there were 3.03 lakh SHGs in the State, nearly two-thirds of them promoted by the State Government under its "Stree Shakti", "Swashakti" and other programmes. The others were formed by banks, NGOs and co-operative institutions.

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