Abstract
Access to adequate and timely credit at affordable rates is critical for the rural poor to alleviate high cost debt and invest in livelihood opportunities. Despite the government of India’s (GOI’s) best efforts, financial inclusion of the rural poor has been beset with multiple challenges. The SHG-Bank Linkage Programme (SBLP) was initiated as an action research by the National Bank for Agriculture and Rural Development (NABARD) in 1989 and was subsequently crystallized into a pilot project in 1992. The pilot project was conceived of as a partnership between SHGs, Banks and NGOs in which the Reserve Bank of India (RBI) allowed banks to lend directly to SHGs and NABARD committed to providing re-finance and promotional support. The SHGs have successfully leveraged about forty one billion US dollars loans from banks since 2013-2014. Advocacy with the RBI, digital financial services (DFS) and Indian Banks Association (IBA) and interventions at the field level have resulted in exemplary growth in the SHG-Bank linkage credit portfolio. The key outcomes are summarized in this report.
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