Self Help Groups in India: Living up to their promise?

This month Frances Sinha is writing about lessons from her important new book, Microfinance Self-Help Groups in India: Living Up to Their Promise. Her first post introduced the book. Today's post describes some of the most striking lessons.

Findings on the questions of social promise

The social promise of Self Help Groups (SHGs) lies in the potential of the group medium, and the potential of wider networks of such groups to provide an empowering community platform for their women members.  

We used the data from 214 SHGs in four states of India to see: In how many groups has a member been elected to the village panchayat (local council)?  How effective are such elected women members in village governance? How many groups have played a role to improve community decisions and action – on, for example, delivery and maintenance of services (schools, health care, roads, veterinary care) and on issues of social justice, especially those of concern to women (domestic violence, dowry, bigamy, treatment of widows)?  How effective or successful have such actions been?  And, when SHGs undertake group based enterprises, how viable are such enterprises?

So we were not looking at women’s empowerment at the individual and household levels (improvements in women’s skills, confidence, decision-making, contribution to the household), so much as how these elements of empowerment may be translated – through the medium of SHGs, and networks of SHGs – into action and agency by women at the community level.

The evidence in the book is that examples of SHG action are perhaps not as numerous or effective as hoped for – this even from a sample which was not entirely random (since our sample was guided by a search for examples of social action by SHGs); but an important beginning is being made in a traditional rural society:

  • In one out of every five SHGs a woman member had been elected to the panchayat, as a ward representative, sometimes as the chairperson (sarpanch). Their election was part of the 33% reservation of panchayat seats for women. Just over half the elected women became actively engaged in panchayat activities (just under half did not). 
  • 30% of the sample SHGs reported a community action, sometimes more than one such action.
  • Around half of these actions were assessed as successful, by the SHGs, for example they were able to improve access and quality of community services and infrastructure (water, road, school).
  • The most common single type of action is the attempt to close down local liquor outlets – with mixed results, when it reopened some time later, or men began going to a neighbouring village where alcohol was on sale.
  • 12% of the sample groups reported action on issues of social injustice, successfully preventing bigamy or children marriage; they were less successful in ending domestic violence or sexual abuse than, significantly, in trying to bring such cases into the open.
  • 14% of the sample groups had started group based enterprises, such as joint marketing of milk, leasing land or a water area. Half of these enterprises were viable, though sometimes with rather low returns. 7% of the groups were involved in trying to manage government contracts – for example as part of the Public Distribution System (for provision of basic needs to Below the Poverty Line families) or to provide MidDay Meals to school children – with even lower returns, because of programme cash flow issues.

These were SHGs that included women below the poverty line (estimated at roughly half the sample – based on participatory wealth ranking linked to an asset index, compared to the national rural poverty rate of 29%) and from scheduled caste and tribal communities. 74% of the SHG members had had no schooling. 

What were the factors that led to effective actions by SHGs? Depending on the issue, it was through mobilization of a number of SHGs within and sometimes across villages to build visibility; mobilizing women from different castes and social groups together. The SHG promotion agency (usually an NGO who forms the groups) can play a key role, especially initially – in creating forums for SHGs to come together, identifying issues, helping to formulate strategy.

The potential social linkages are part of the promise of SHGs for their women members.  But what about the financial transactions around which the SHGs were formed?  We will turn next to questions around financial sustainability which are addressed in the second part of the book.