Posts Tagged ‘SHG’
Micro Loans Have Changed India
April 6, 2011 | 
Author How Micro Loans have changed India
Dola Tikader lives in the village of Bankura in West Bengal. For years, she has struggled to make ends meet with her family’s craft of making beaded jewelry. But now Dola is free of most of her financial troubles, is working on expanding her business and has employed 9 other women from her village as well. All of them make a decent income and are generally quite a happy bunch. How has this been possible?
Well, the thing that made this huge difference was a micro loan. Dola got a micro loan of Rs 15,000 from an MFI working in her village and she used it smartly. First she got trained in the Self Help Group (SHG ) initiative where she learnt all about making fancy costume jewelry and updated herself on the latest styles and trends women in Calcutta prefer. After that she used the micro loan to get the raw material required and started producing jewelry. She sold her hand- made jewelry to sellers in Calcutta and made a decent profit. And then she employed other women from her village in her business as well.
It may sound corny, but micro loans and other micro financing have actually changed India. The success rate of SHGs’ who have availed of micro loans is so high that it makes loan sharks look bad. The repayment of micro loans has been estimated to be more than 97%, which is very good by any standards. As support for micro loans keep increasing, so does their influence.
Posted in Micro Loan Success Stories | 
Tags: india, loan, MFI, micro loan, micro loan india, micro loans in india, Micro Loans India, Microloan, Microloans in India, SHG | 
No Comments »
Micro Loan Role In India
The role of Micro loans in India: A boon
Most people have heard of Micro finance and micro loans in India, but very few actually give serious thought to it. The truth is that micro loans have changed the way the rural community lives. Once upon a time, someone from a low- income background without any verifiable credit history couldn’t dream of getting a loan fro a bank, but due to government initiative the person can have access to a micro loan without any collateral. Poor disadvantaged people can now set up small cottage industries and earn a decent living for themselves and their families. That is the case in Krishnakari in Tamil Nadu.
With the help of the Mahalir Sangam, a Self Help Group initiative by the state and central government, the economic condition of the people of Krishnakari is changing. Many SHG’s have been formed with the help of the money got from micro loans and poor women and men are earning a livelihood as employees. One such success story is of an SHG which sells ‘Chapatis’. With a micro loan of Rs 22,000 from a Micro Financing Institution (MFI), this SHG started a smart Chapati- making service. They even bagged an order for making 3000 Chapatis for TVS employees everyday. The SHG has not only repaid the micro loan fully, but are making a decent profit as well.
The role that micro loans in India have played is truly commendable. As awareness about micro loans grow, so does the rural economy.
Posted in Microloans In India | Tags: bank, credit, loan, Loans, Mahalir Sangam, Micro Finance, micro loan, Micro Loan In India, micro loan india, micro loans, Self Help Group, SHG | No Comments »
Micro Loan Success In Jharkhand
Women in Jharkhand become self- dependent with the help of micro loans
Micro loans in India have helped pave the way for empowerment of women throughout the country. Success stories from far- flung villages of India have made micro loans the buzzword in rural economy. At one time, these women had nothing to do except household work and looking after children. But now they are starting businesses and helping their own families economically and also employing other people as well. A small village called Gumla in Jharkhand has a success story that speaks highly of what micro loans and Self Help Group (SHG) initiatives have achieved so far.
Gumla is a tribal village with mostly economically – disadvantaged people. The district administration gave women from this village training in a variety of vocations such as making of soaps, pickles, detergents, and phenol. The training went on for 15 days after which they were given the option of being able to avail of a micro loan. Most women who underwent the training started their own home- based businesses or joined another SHG and started earning their living. One of the women is Nita Kumari who has joined an SHG and she makes pickles everyday. She is happy that she has been able to improve her family’s condition a lot.
Micro loans have actually enabled people like Nita Kumari to actually do something on their own and become self- reliant. Perhaps more than the money is the self- confidence that a micro loan can give to these simple folks.
Posted in Micro Loan Success Stories | Tags: gumla, home based business, jharkhand, micro loan, Micro Loan Success, micro loans, Microloan, SHG | No Comments »
Why Micro Loans
Why giving Micro Loans is better than dole- outs in India
Micro financing and micro loans in India have come a long way since the government started such initiatives way back in the 1990’s after the example set by the Grameen Bank of Bangladesh. Various programs such as the Swarnajayanti Gram Swarozagar Yojana were started to help people from low- income families to start Self Help Groups (SHG’s). SHGs’ are meant to act as initiatives where not only disadvantaged people can help themselves earn a living, but also help similar people from their community do so. It helped foster a spirit of team wok among people. All this has been made possible because of micro loans.
The reason why micro loans are a lot better than dole- outs is because it helps in building self confidence. Rural people without any land or property often have to wait for days for work. They are impoverished and have difficulty in providing for their families. Giving them free food, blankets, clothes and even money may help for the time being, but it will do nothing for their long- term finances. A micro loan on the other hand, makes them feel that a financial institution actually holds them in high esteem. Micro loans help them understand that they have the abilities and skills required for setting up a SHG and running their own business. This is perhaps the reason why repayment of micro loans is at such a high in the country.
Truly, poor people work better with a micro loan than a dole- out.
About Micro Loans In India
The truth about Micro Loans in India
When the government introduced various initiatives for starting Self Help Groups (SHG’s) in the 1990’s, a lot of people were skeptical as to how it would be possible for poor women to find the money to start such businesses. Micro loans came to the rescue. The government started allowing Micro Financing Institutions (MFI’s) to make micro loans available to poor rural women who had no verifiable credit history. Though the amount available through a micro loan was not big, it was enough to start SHG’s dealing with home- based, small- scale businesses.
In Punjab, using the Swarnajayanti Gram Swarozagar Yojana (SGSY), one of the programs brought out by the government, rural women were given assistance with how they could start their own SHGs’. They were given vocational training in how to make stuffed toys, do embroidery, stitching and knitting tasks, etc. The Mukstar district in the state of Punjab has presently 330 SHGs’ who have been helped by this program. What’s more, the women are also made to understand how they could avail of a micro loan from an MFI.
The success of Kuldeep Kaur, one of the women who have taken part in the government initiative and now runs her own SHG shows clearly on her face. She is a differently- abled woman who learnt the tricks of the trade and finally started her own SHG employing other women. She availed of a micro loan which gave her the initial capital investment she required.
Micro loans in India truly deserve the accolades it gets.
Rural Micro Loan Success
Rural women’s success story tastes sweet: What micro loans in India have achieved
Since the early 90’s of the previous century, micro loans in India have continued to become more and more important to the social and economic structure. Till its advent, it was not considered that poor women from villages could actually become self- reliant and become the breadwinner of their families. But now, this is a reality; not a far-fetched dream. The success of micro loans in the country has been unprecedented as more women from far- flung parts of the country are coming forward to set up small- scale cottage industries with the help of micro loans financed by Micro Financing Institutions (MFI’s).
One such success story is that of a Self Help Group (SHG) in Tamil Nadu which involves women in making a particular variety of milk sweets and sells them in the market. The special sweet is called ‘Palkova’ and is made with milk and sugar as its main ingredients. The sweet is sold not only to the locals, but also to people in Bangalore, Erode and Coimbatore. The very fact that people from such big cities are buying the sweets proves that the SHG women are doing a great job. Shops, retailers and even corporate offices are falling for the Palkova!
All this success has been made possible with the help of a micro loan that this SHG obtained. Truly, the advent of micro loans in India has ushered in a new era of economic empowerment of the rural women.
Micro Loan Success In Tamil Nadu
Women in Tamil Nadu become financially independent with Micro loans
Micro loans in India have ushered in an era of independence among poor rural women. The micro loan schemes have specially benefited the southern Indian state of Tamil Nadu where women from low- income families have come forward to take part in Self Help Group (SHG) initiatives. The SHG’s are helped financially by both by the central and state governments by letting them avail micro loans easily. Krishnagiri district has written yet another success story of the SHG’s and micro loans in India.
In this district, cottage industries have been set up to cater to the needs of rural women. One such SHG involves 20 women who spend their days making soft toys and beautiful accessories. These women have been taught how to make beautiful articles with their hands and they earn a decent Rs 100 to Rs 110 for each day of work. This translates to about Rs 3000 a month. The women are also taught regularly to update their skills and increase their repertoire. They learn the latest designs in soft toys and accessories, which help them keep in sync with the demands of the market.
Not only do the SHG volunteers help the women with training, but also for availing micro loans from Micro Financing Institutions (MFI’s). They also organize fairs and exhibitions to show off the handiwork of the women and make sales regularly. Their success story has shown what a micro loan can do for the poor, disadvantaged, disabled and minority community.
How Micro Loans Help Low-Income Families
Micro loans: A helping hand to low- income families in India
With roughly 1.2 billion people in India living below the poverty line, it is no wonder that government initiatives for poverty alleviation became a serious concern to be considered in the 90’s of the last century. After a lot of thought, it was decided that micro loans would be made available according to the commendable example set by the Grameen Bank of Bangladesh. Micro loans are easily available, do not require a collateral or verified credit history and were available in amounts varying from a few hundreds to a lakh rupees.
Micro loans are meant to be a helping hand for low- income families. They were mainly meant for women, though a lot of men have enjoyed their benefits. A micro loan is usually given out because it is expected that the borrower will use it as capital investment for starting a small scale business, preferably employing a few other people as well. Self Help Groups (SHG’s) were linked to the mainstream banking system through micro loans in India. There are options for multiple micro loans as well.
The concept of micro loans in India is such that low- income persons who would otherwise have not been eligible for a loan from a normal bank or financial institution for setting up a business can take advantage of. With more than 2.5 million SHG’s in India started with the money got from micro loans, micro finance has truly achieved what it set out to.
Micro Loan Success For SHG’s In India
SHG’s in India are thriving: Thanks to Micro Loans
When the government initiated the doling out of credit to Self Help Groups (SHG’s) in India, it was with the purpose of poverty alleviation. It was felt that group lending would ensure better loan repayment and a greater equity in the amount of money given out. The concept of SHG’s was the brainchild of Professor Mohammad Yunus of Bangladesh, from wherein India adopted it. The small loans being given out to poverty stricken people who have no verifiable credit history came for the purpose of setting entrepreneurial ventures came to be known as micro loans in India.
Programs such as ‘Maharashtra Rural Credit Project’, ‘Development of Women and Children in Rural Areas’ and ‘Swarna Jayanti Gram Swarojgar Yogana’ were developed to ensure that the money reached the right people. Since availing of a micro loan is easy, more and more poor people from rural communities came forward and started home- based, small- scale businesses which not only helped them in meeting their own financial requirements, but allowing other people in the community earn a living too.
The number of SHG’s in the country has been rapidly increasing and going by statistics, repayment of such micro loans have been excellent as well. Rough estimates state that there are 2.5 million separate SHG’s functioning in Indian villages and small towns. Thanks to the disbursement of micro loans in India, rural women and men are gaining self- sustainability, increase in incomes and a valid way of empowerment.
SHG’s Benefitting From Micro Loans
How SHG’s can benefit from Micro loans in India
The concept of Self Help Groups or SHG’s in India was started with the motive of poverty alleviation of disadvantaged people. Community participation is what SHG’s depend on. When the community participates in creating wealth, it ensures that the profits are equitably distributed. This has worked extremely well for the rural poverty stricken community of India. NABARD introduced Micro Finance or Micro loans to help SHG’s way back in the 90’s of the previous century.
The government of India with the help of NABRD made sure that such SHG’s were developed in as many villages as possible, keeping the requirements of people, especially women in mind. The idea was to empower them, create a feeling of community and meeting the financial requirements of those who participated. The response has been overwhelming. Not only have the rural women displayed wonderful entrepreneurship skills, they have also helped in the creation of jobs for other people in their community.
Micro loans in India were started as a scheme to help SHG’s get credit. Regular loans would not have done anything because these people were not considered credit- worthy by mainstream banks. A micro loan could be anything from a few hundred rupees to one lakh rupees and availing it was easy and required no collateral. With such micro loans, an enterprising individual can easily set up a small scale, home- based business. Truly, micro loans in India came as a boon to financially disadvantaged people and have ushered in a rural revolution.
Posted in SHG's In India | Tags: credit, loan, micro loans, Microloans in India, Self Help Groups, SHG | No Comments »