Self-Help Groups and Women's Economic Power

How India's self-help group movement organised crores of rural women into savings and credit groups, and what it has achieved.

India has one of the world’s largest self-help group (SHG) movements, mostly of women.

What an SHG is

A small group of around 10 to 20 women who:

Save small amounts regularly.
Lend to members from pooled savings.
Borrow from banks as a group.
Meet regularly and keep records.

Growth

NABARD launched the SHG-Bank Linkage Programme in 1992, letting banks lend to SHGs.
The National Rural Livelihoods Mission, launched in 2011 as DAY-NRLM, expanded SHGs dramatically.
Around 9 to 10 crore women are members of SHGs.

Achievements

Savings habits and access to credit.
Repayment rates on SHG bank loans are generally high.
Livelihoods: SHGs support small businesses like tailoring, dairy and food processing.
Empowerment: women gain confidence, networks and voice in local institutions.

Kerala’s Kudumbashree

Kudumbashree, launched in 1998 in Kerala, is a large women’s network that runs businesses, catering, microenterprises and even local services.

Lakhpati Didi

In 2023, the government set a goal of creating 3 crore “Lakhpati Didis”: SHG women earning at least 1 lakh rupees a year.

Challenges

Moving from small loans to viable businesses.
Market access for products.
Over-indebtedness when members borrow from multiple sources.

The pickle business

Ten women in a village SHG save 100 rupees a month each. After two years, they take a bank loan and start a pickle-making business, selling in local markets and online. Each member earns extra income.

Thinking SHGs are just small savings clubs

SHGs provide credit, livelihoods, networks and empowerment on a massive scale.

Key takeaways

SHGs are groups of women who save, lend and borrow together.
NABARD's 1992 bank linkage and NRLM from 2011 drove growth.
Around 9 to 10 crore women are SHG members.
The Lakhpati Didi goal targets 3 crore women earning 1 lakh a year.