A Review on Self Help Groups Bank Linked Micro Financing: Problems and Challenges

Abstract

Economic development and growth should be inclusive, sustainable and real. Development mean positive changes at the grass root level in the field of primary education, health and qualitative food for poor. Micro financing (SHGsBLMF) this model has proved its effectiveness in improving the real life of rural poor. Self help group is a concept emerged in the direction of helping rural poor forming groups so that; they will improve their living conditions through voluntary participation in thrift and credit. The core objective is flexibility, transparency and autonomy with sensitiveness and responsiveness of the participants. This model of financing has outraced moneylenders and village sahukars in providing credit to rural sector. Repayment position is above the satisfactory under this system as group collectively takes responsibility to pay. No system is free from problems and challenges. MF is also not the exception. Here authors have made an attempt to reveals the various problems and drawbacks of this system of financing faced by borrowers, facilitators and agencies. A review on overall working and role played by SHGsMF have discussed as well as a list of suggestions has also provided for corrective actions for system strengthening and effective implementation in future.