Group Dynamics and Collective Performance of Self-help Groups under Different Microcredit Delivery Models in Karnataka

Abstract

Microcredit through self-help groups (SHGs) has emerged as a springboard to reach the rural poor. In India, it is being practised in different ways and monitored in three different arrangements based on the SHGs linkage with the supporting organizations. They are: Model-I: Bank-promoted, Model-II: Government-promoted, and Model-III: NGO-promoted. The paper has examined differences in the collective performance and the pattern of relationship of the individual characters, group variables and economic variables among the three micro-credit delivery models. The analysis is based on the data from 90 members from nine SHGs operating in three taluks in the Davanagere district of Karnataka state. The categorical regression has revealed that cooperation, consensus among members, knowledge on SHGs linkages and transparency in activities significantly influence the collective performance. It has also been found that SHGs can improve their performance by creating awareness in its members on the SHG purpose and by giving regular updates of information. The paper has recommended that, while dealing with the SHGs and its delivery models, context-specific difficulties and ground realities need to be taken care essentially.