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Mains Answer Writing


Q1) Self-Help Groups (SHG) provide not just micro-finance interventions, but a pioneering model of women-led development. Comment.

(150 Words/10 Marks)


Self-Help Groups (SHGs) are informal associations of people from similar socio-economic backgrounds who come together to find ways to improve their living conditions. SHGs serve as important medium for distribution of micro-finance through government schemes such as SHG-bank linkage programme, but their development role is much wider.

According to Economic Survey 2022-23, India has around 12 million SHGs and 88% have only women members. The SHGs provide a pioneering model of women-led development in the following ways:

  1. Economic Independence: By providing access to financial services, such as microfinance, savings, and credit facilities, SHGs have helped women engage in income-generating activities, and become financially self-reliant.
  2. Development and Growth: SHG-induced economic empowerment results in improved living standards of women and their families. It results in better diets and rural demand for consumer goods.
  3. Social Issues: SHGs have served as platforms for women to collectively voice their concerns and address social issues such as domestic violence, dowry, child marriage etc. SHGs help build solidarity among women, and create social cohesion on rights issues.
  4. Community-development: SHGs facilitate capacity-building programs and skill training, in various sectors including health, education, sanitation, etc.

E.g., rani-mistris’ (women-masons) role in making Jharkhand open-defecation free.

  1. Changing Gender-roles: SHGs have enhanced women’s decision-making power within households and communities.

E.g., bank-sakhis and SHG-didis as community resource persons.

Despite SHG’s vital role in creating women-led development, they also have the following limitations:

  1. Socio-cultural Limitations:
  2. The dominant members exploit the resources undermining participative governance of the SHG.
  3. The patriarchal society reduces women’s agency. The incomes from women’s activities are often appropriated by the male-members of the family.
  4. SHGs face challenges of poor maintenance of records and cashbooks. It limits their access to finance for scaling up their economic activities.
  5. The artisans lack the business sense to adapt to modern trends. They do not have the economic acumen to appropriately market their product which results in poor price-realisation.
  6. Skewed regional distribution: The spatial distribution of SHGs is skewed towards southern states. Developmental laggards such as Bihar, Jharkhand etc. have poor penetration of SHGs.
  7. Small scale: SHGs’ ventures are limited in scale. The model of social pressure in inducing financial thrift limits the appetite for risk.


SHGs have made significant strides in enabling women-led development at the grassroots level in India. The prime minister of India has appropriately referred to them as “nation-help groups.” Efforts are needed to address the socio-cultural and institutional limitations to ensure the sustainability and scalability of SHG initiatives.

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