“Microfinance as an anti-poverty vaccine is aimed at asset creation and income security of the rural poor in India”. Evaluate the role of Self Help Groups in achieving twin objectives along with empowering women in rural India. (250 words)
- Self Help Groups (SHGs) are community-based organizations that consist of small groups of individuals, typically women, who come together to save and borrow money from each other.
- SHGs have played a significant role in microfinance and poverty reduction efforts in India, as they provide access to financial services for individuals who may not have access to traditional banking services.
- SHGs promote asset creation by providing access to credit and loans, which can be used for investment in small businesses or agriculture. This can lead to increased income and financial security for the rural poor.
- SHGs also promote income security by providing a safety net for members during times of financial hardship. Members can borrow from the group’s savings in times of need, and this can help to reduce the impact of unexpected expenses or income shocks.
- In addition to promoting asset creation and income security, SHGs have also been effective in empowering women in rural India. By coming together in a group, women are able to collectively make decisions and advocate for their own needs and rights. This can help to increase their confidence and decision-making power within their families and communities.
- Despite their success, SHGs face challenges such as lack of access to formal credit, high interest rates, and lack of government support. To address these challenges, there is a need for greater government and private sector support for SHGs, including increased access to formal credit and technical assistance.
