The Rural Network

Forbes India|August 14, 2020

The Rural Network
Leveraging the potential of women self-help groups for economic revival calls for bridging the digital divide, building scalable programmes, and creating targeted interventions for the most vulnerable
Divya J Shekhar

Jugni says she is “as illiterate as a buffalo”, speaking in Hindi as she lays out a plastic mat next to a farm where a few goats are tied to trees. She belongs to the Garasia tribe in the Sirohi district of Rajasthan, and is meeting with five other members of her self-help group (SHG) in July after a gap of four months. Their functioning had come to a complete halt during the lockdown, and there was a lot of work to do. “We could not go to the market to sell our produce, and used to give it to a middleman who collected it from our homes. So the bhindi [okra] we used to sell for ₹20 a kilo went for as low as ₹7 per kilo during the lockdown,” she says, over a video call on a borrowed smartphone. She owns a feature phone, and is just warming up to virtual meetings.

Jugni, one of the founding members of the Chetna Rani Mahila SHG, says she has come a long way from getting women to save ₹10 each week to be able to get electric supply to their fields two decades ago. Today, the 13 women in her group are able to save up to ₹80,000 a year and take small loans from local cooperatives for their farming and animal husbandry ventures. Their financial literacy, visible in the meticulous accounts maintained in notebooks, has been learnt entirely through experience. Digital knowledge never seemed like a priority, until now, and Jugni is willing to learn, if adapting to change is what it takes to survive in the wake of the pandemic.

“Most people have a feature phone and a bank account in these villages. Only a few members in about 150-odd women’s groups out of 500 in this area are educated and own a smartphone. After the movement of SHGs was severely restricted during the lockdown, we are working towards piloting a digital literacy project among these 150-odd groups in August,” says Richa Audhichya, a social activist who works with local women SHGs through her organisation Jan Chetna Sansthan. “It’s time, because these women can’t stop just because there is uncertainty due to the pandemic.”

The SHG Network

67.9 million Women in SHGs covered by the National Rural Livelihood Mission (NRLM)

56% Of households mobilised into SHGs belong to SC/STs and minority communities

9,400 Rural women banking agents that help other SHG members engage with their creditors while ensuring they maintain a healthy bank portfolio

7 million Women who have received financial literacy training

SOURCE South Asia agriculture and Rural Growth discussion Note Series, March 2020; World Bank

Money Matters

For women-only SHGs, as on March 2020:

88 lakh: Number of SHGs covered under the SHG-Bank Linkage Programme

₹23,320 crore: Cumulative deposits with these SHGs

₹73,298 crore: Annual loan offtake by these SHGs in 2019-20

51.12 lakh: Number of SHGs having loan outstanding

₹1 lakh crore: Approximate amount of outstanding loans

4.9%: Gross NPAs of bank loans to SHGs, down from 5.19% on March 2019

SOURCE Status of Microfinance in India 2019-20 report by NABARD

India’s network of rural SHGs— where women from similar socioeconomic backgrounds pool in their savings and manage their credit interests with the principles of solidarity and mutual interest—has grown over the years, enabling women to be enterprising, take risks, earn financial independence and seek greater participation in the decisions taken in their homes and villages. India has over 68 million women working as part of SHGs, and like most industries and sectors they are turning the Covid19 challenge into an opportunity.

“The government, through the National Rural Livelihood Mission [NRLM], has given them a capitalisation support of ₹10,200 crore, and these SHGs have also earned bank credit of over ₹2.9 lakh crore,” says Alka Upadhyay, additional secretary, Union Ministry of Rural Development (MoRD). She points to the low non-performing asset (NPA) rates of women-led SHGs to emphasise that they can play a critical role in India’s economic rebuilding story. According to the National Bank for Agriculture and Rural Development (Nabard), the gross NPA rate for women-led SHGs is around 4.9 percent as of March 2020, which is half the rate of NPAs in banks.

“SHG women have been proving to banks that they are serious customers, and based on how this network has demonstrated its capabilities during Covid-19, it makes sense to nudge them towards a higherorder economic activity by making available more community funds and credit linkages. Digitising the SHG channels is another big step in this direction” says Upadhyay.

She is referring to how the SHGs led by women supported the government with essentials to fight the pandemic. According to the MoRD, since March, women have made about 17 crore masks, 53 lakh protective equipment and 51 lakh litres of sanitisers. Leveraging their skill sets and using technology to connect with each other and deliver in record time during the lockdown, these SHGs are now helping governments address issues faced by migrant labourers in their respective states.

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August 14, 2020