When the concept of self-help groups (SHGs) was launched 33 years ago in an obscure village of the backward Dharmapuri district with the assistance of International Fund for Agricultural Development, the idea was to improve the overall socio-economic and political status of women. But, over the years, the SHGs have transformed into a movement that has not only served as a link between the conventional banking system and those who were left out but also emerged as tools of poverty reduction. The SHGs, apart from being frontrunners in the Bank Linkage Programme (BLP), constitute an important element in the implementation of the National Rural Livelihoods Mission and the Tamil Nadu Urban Livelihoods Mission.
Today, Tamil Nadu’s ‘Mahilar Thittam’, and its subsequent variants, is studied by development experts globally. Andhra Pradesh has replicated it as Podupulakshmi- Indira Kranti Patham, Bihar as Jeevika, Odisha as Mission Shakti-Targeted Rural Initiatives for Poverty Termination and Infrastructure. In Kerala, it is Kudumbashree. A November 2020 paper, published by the Bonn-headquartered IZA Institute of Labour Economics, credited the movement with, what it called, the feminisation of the formal finance market in Tamil Nadu, which commenced in the late 1990s. This was made possible as the SHG model had been bolstered by active public policy and multilateral agency support. During the previous financial year, 4.46 lakh SHGs were credit-linked with loans totalling about ₹18,886 crore at an average loan size being ₹2.36 lakh. The Tamil Nadu Corporation for Development of Women (TNCDW) is a significant player in shepherding the movement.
“SHGs have made a difference [to the condition of women in villages],” observes Kripa Ananth Pur, Associate Professor, Madras Institute of Development Studies (MIDS). Citing the experience of the World Bank-funded Pudu Vazhuvu project and the findings of a 2013 study of the Bank, the academic says the project has led to a significant reduction in the cost of debt and nudged the beneficiaries towards more productive loans for the purposes of non-farm livelihood.
More than the economic dimension is the impact that the SHGs made on women with regard to enhancing their self-esteem. “The movement has proved that women can do as much as men,” says Shenbagavalli of Ayapakkam in Tiruvallur district, who has been with the SHG movement for nearly 20 years. Among the economic activities carried out by her group is the project of making plastic bitumen. “We had supplied it for road projects in Tiruttani and Pallipattu,” she points out. The success of the project has boosted the confidence of women-members of the SHGs. Also, their visibility and sense of pride has gone up.
S. Durgadevi, a resident of the Tamil Nadu Urban Habitat Development Board’s flats in Navalur, Tharpanacheri Panchayat, Kundrathur taluk of Kancheepuram district, has been an active member for the last five years. There are 47 SHGs in the apartment complex with an average size of 15 per group. Calling herself a “motivating force” for women of her area in organising themselves, Ms. Durgadevi says economic empowerment that the women achieved enables their families to meet the expenses of education and health considerably, if not substantially. “Our stock in the decision-making process at homes has risen tremendously,” she emphasises.
There are flip sides to the saga. Despite the SHGs and panchayats working in tandem, it is a debatable point whether the movement has sprung up a significant number of women panchayat leaders, says a senior government official. Acknowledging the role of the SHGs in creating access to microfinance for economically vulnerable sections, the official, however, holds the view that a section of the SHGs is no different from private micro-finance institutions with regard to the levy of interest. The only difference between the two is that the SHGs do not adopt the same kind of recovery methods.
Asked whether the mix of loans taken by the SHGs is loaded in favour of consumption purposes, the official replies in the affirmative but asserts the movement is achieving what the traditional banking system could not. “After all, women are using the loan facility either at the time of festivals or for the education of their children or to meet the medical expenses of their family members. What is wrong with that?” the official asks. A representative of the State Level Bankers’ Committee says there has been a “decent combination” of consumption loans and productive loans in the overall portfolio of the SHGs.
The future of the movement hinges on countering the “relentless drive” of private MF institutions in wooing women to their fold and members of the movement displaying greater entrepreneurial spirit than what they have done. Ms. Shenbagavalli’s suggestion to blunt the MF institutions’ “onslaught” is the increased assistance by the government to the SHGs. Another official says the government should create more avenues to market the products of SHGs to nurture the entrepreneurial spirit among women.
Notwithstanding the challenges, many SHG members are confident of the sustainability of their ventures after listening to the speech of Chief Minister M.K. Stalin in Vathimalai village in Dharmapuri last September. In it, he explained the steps being taken by the government to support the movement.
