Saturday, 4 August 2012

Establishment of a Self Help Group

Cecile Poulain,
The women of the Naddi Self Help Group
One of the our micro-finance initiatives is aimed to create a Self Help Groups within the village communities.

A self help group is a socio-financial organization of villagers based on mutual support both in finances and other areas also. Each of its members save each week or month a small amount of money which is gathered in a common “box”. It thus encourages savings, and can provide its members with small loans at a reasonable interest rate for business purposes or in times of financial stress. 

The self help group of Naddi counts 14 members, all being young women from the community we work with and relatives from the area. They all contribute to the SHG giving 50 Rps on the 10th of each month. Each week they meet to discuss various issues in their community such as health and environmental issues. Many of them have expressed a desire to further their education and learn to read and write Hindi and/or English. They have then been able to support each other from within the group and some have stepped up to act as teachers for this purpose. They are really motivated and receptive, and enjoy coming to the group to ask constructive questions and learn more about various topics that interest them.
Enjoying different educational activities each week

This self-sustaining business model has the power to give them a total control and a structured mechanism to support each other and empower themselves. Through their own independence and open choice they decide to be SHG members, to save and to take loans and to pursue various livelihood opportunities that are of interest to them. They decide how they should use the money they earn and how it can serve health, environmental issues and their community. They are an autonomous group and as such independent from banks or MFI’s with high interests rate for lending. Thus, the main output of Naddi SHG is individual women empowerment, as well as social, human and financial community empowerment and sustainable community economy development.


A support and empowerment network for the village women
The SHG was created in June 2012 and since then meetings are conducted every two weeks. So far, we have had 3 main meetings: the first one to explain the principles of a SHG to the members, the second one to get the money collected, and the last one to choose the management committee and discuss the internal policy. The next two months will be devoted to the proper settlement of the group and for them to decide and develop their own business plans.

From October, till December, we aim to let the women to accumulate money. Nevertheless, we agreed on the fact that the money that they would add in the SHG bank shouldn’t come from a brother or father, but should be earned from their own additional income generating activity. This is the transversal link between the SHG and the other microfinance projects which help the women to earn their own money. As the SHG won’t deliver any loan during this phase, if women need money to start a business for example they can address their project directly to EduCARE India which can provide them a micro-finance loan (as has already happened for one member, Lata and the chicken coop). 

The SHG also involves a lot of fun activities like dancing!
Then, from January 2013, the women should be ready to start the internal group loaning process. They will also be able to register themselves as a SHG for mutual support and to be able to apply for grants and other external assistance from the government.

If everything goes well, they will become totally independent in 2013 and act as good role models for other community members to initiate more SHGs.

Cecile Poulain