In recent years, government and Non Government Organisations (NGOs) have tried out some newer ways

Question

Read the paragraph 3rd under the heading of ‘Self Help Group for the Poor’ and answer the question. How are SHGs working in your area?

In recent years, government and Non Government Organisations (NGOs) have tried out some newer ways of providing loans to the poor. The idea is to organise rural poor, in particular women, into small Self Help Groups (SHGs) and pool (collect) their savings. A typical SHG has 15-20 members, usually belonging to one neighbourhood, who meet and save regularly. Saving per member varies from Rs. 25 to Rs. 100 or more, depending on the ability of the people to save. Members can take small loans from the group itself to meet their needs. The group charges interest on these loans but this is still less than what the moneylender charges.

(OR)

“Self Help, Groups play a vital role in the women empowerment. They not only provide economic support but also help in eradicating poverty”. Explain the work of a self help group in your village.

Answer 1

The working of SHGs in our area : 

1. There are 10 to 11 SHGs in our village. 

2. All are registered. They voluntarily coming together to save regular small savings of money, mutually agreeing to contribute to a common fund and to meet their emergency needs on the basis of mutual help. 

3. They pool their resources to become financially stable, taking loans from the money collected by that group and by making everybody in that group self employed.

4. They borrow loans from banks and repay it back regularly. 

5. An economically poor individual gains strength as a part of a group.