Impact of microcredit on income and employment of self‐help group members in Punjab: Does credit size matter?

Abstract

AbstractThis study evaluates the impact of microcredit on the income and employment level of participants before and after joining self‐help groups (SHGs) and variations based on the size of microcredit. Data was solicited from 318 SHG members using multistage random sampling. The mean value of income and employment of SHG members before and after joining SHGs were compared by using t‐statistics. The logistic regression technique was used to ascertain whether the income and employment level of SHG members varies significantly with the size of microcredit. We found significant improvement in the income and employment levels of participants after joining SHGs. The results of the logistic regression model revealed that the probabilities of members earning an income of more than 3,000 Indian Rupees (INR) per month and having employment of more than 180 days were very high among large borrowers as compared to small borrowers.