Development of Rural Entrepreneurship through SHGS: An Empirical Study

Abstract

Entrepreneurship has been gaining greater significance at international stage under changing economic scenario. Indian economy is on the threshold of accelerated economic growth driven by entrepreneurship. The present study is an attempt to find out impact of microfinance through SHGs in development of rural entrepreneurship. The study shows that though microfinance through SHGs have helped in promotion of rural entrepreneurship but there are various problems which the rural enterprises are currently facing like insufficient transportation and storage services, lack of quality control measures, non-availability of right type of raw material, difficulty in selection of products, poor linkage with selling bodies, small scale of production, lack of trained workers and improper communication with other developmental agencies and most importantly long and complicated procedures to avail financial help. All these factors are restricting the rural enterprises from reaching their full potential. Activity wise analysis of the respondents suggests that selected SHG members are mainly involved in activities which require lesser amount of forward and backward linkages. The activities requiring more linkages and service inputs have not been successful to that extent.