The impact of NABARD's Self Help Group-Bank Linkage Programme on poverty and empowerment in India

Abstract

Exiting impact analysis studies on the Self Help Group-Bank Linkage Programme (SBLP) of the National Bank of Agriculture and Rural Development (NABARD) underline that the programme has done extremely well in rural India in terms of its outreach, generating income, reducing poverty levels and empowering people both economically and socially. This paper evaluates the impact of SBLP on Self Help Group (SHG) members at the household level from a gender perspective. The analysis of the study is based on a large sample of primary data covering 4791 SHG households and 900 SHGs collected from six states in India. Furthermore, the sample covers more than 60% of SHGs that consist of members belonging to below poverty line families. Overall, the performance analysis reveals that households whose member(s) belong to all-female SHGs perform better than households whose members belong to other types of SHGs. This is mainly because female SHGs are doing extremely well in terms of recovery of loans and per capita income and savings. A chunk of female SHG members in all the six sample states reported an improvement of their social empowerment after joining the SHG programme. Furthermore, the fall of poverty is more pronounced in cases of households whose members belong to female SHGs at 26.0 percentage points between pre-SHG period and post-SHG period. The policy implication is that the formation of female SHGs needs to be encouraged and all necessary services should be provided to them.