Progress of Self Help Groups (SHGS) and Micro Finance in India

Abstract

This study attempted to examine the progress in the number of SHGs, amount of savings of SHGs with banks and amount of bank loans disbursed to SHGs during the year between 2007-08 and 2011-12. During the period under review the total number of savings linked SHGs has increased by 58.91 per cent while credit liked SHGs registered a decline of 3.58 per cent. As on March 2012, a total of 79.60 lakh SHGs were having a savings bank account with banking sector with outstanding savings of Rs.6,551 crores against 50.09 lakh SHGs with savings balance of Rs.3,785 crores at the end of the March 2008, showing a growth rate of 58.91 per cent and 73.07 per cent respectively. Among the financial institutions, the commercial banks accounted 63 per cent of total saving balance of SHGs as on March 2012. Among the various regions, the southern region accounted for 56.67 per cent of the total saving balance of SHGs as on March 2012. Banks financed the SHGs with loans of Rs.16,535 crores as on March 2012 as against the loans of Rs.8,849 crores as on March 2008, registering a growth of 86.9 per cent. Commercial banks led in disbursement of loans to SHGs with 60.13 per cent share as on March2012. Among the various regions, the southern region has recorded the highest in the disbursement of bank loans accounting 76.57 per cent of the total loans disbursed to SHGs as on March 2012.