Harnessing the Power of Self-Help Groups for Socio-Economic Development

Abstract

Self-Help Groups (SHGs) have now come out as a strong instrument in providing solutions to socio-economic issues in the marginalised societies. SHGs began in the 1970s; these are community-based groups that empower people by group action, mutual assistance and collective decision-making. These groups are normally comprised of 10 to 20 persons with similar socio-economic backgrounds who meet voluntarily to save and borrow money and invest it in order to have mutual benefits. The main values of SHGs are trust to help others, collective accountability and collective decision making, which create social unity and a self-sustaining economy. The amount of SHG integration in financial inclusion, enhancing gender equality and stirring sustainable growth as observed empirically in different areas, shows a significant contribution. Research has found that being a member of SHG has a big impact on the measures of female empowerment, like the ability to make decisions, improve freedom of movement, as well as access to resources. SHGs have also played a significant role in alleviating poverty and developing entrepreneurship in rural areas, and improving the capabilities of the marginalised in the economy. SHGs have several challenges, even though they are successful, such as poor access to formal financial institutions, barriers of social and cultural to the engagement of women, and problems of governance. The challenge to overcome these difficulties is the excellent plan involving creative initiatives and the support of legislation and collaboration in the community. Use of digital technology, better financial inclusion, and a strong governance system can assist SHGs in their reach and keep hold of their grassroots nature.