Self Help Groups and Micro Credit- An Analytical Study with Special Reference to Coimbatore City (original) (raw)

2010, Journal of Global Economy

Introduction India has a population of 1027.01 million with 742 million living in rural areas. About 40 percent of the rural population and 23.62 percent of the urban population are estimated to be living below the poverty line, the urban and rural poor have been dependent on money lenders for their financial needs, such as marriage in the family, illness or other lenders for their financial needs, emergency needs, as the formal credit system of banks, by and large, is beyond the reach of the poor, this provides an opportunity for money lenders to exploit the situation. The prime need of the hour is to ensure that the poor people are bankable and that they themselves are likely to have a better appreciation of their socioeconomic situation. The activities of self help groups (SHGs) have emerged as a sustainable approach to make credit facilities available to the poor at their door step in a simple and flexible manner. 2 Features of SHGs Generally, SHGs encompass several activities of men and women but the Indian focus is on financial aspects of SHGs, in addition to India, this financial SHG concept is being promoted in Bangladesh, Indonesia, Thailand, Philippines, Nepal, Srilanka, etc. the salient features of SHGs are. i) Homogenous in terms of economic status, interest and affinity group. ii) Small in size and their membership per group range from 10 to 20 people.