The Self Help Group (SHG) movement has created a silent revolution, especially in the rural parts of Maharashtra where women folks have come together to fight anti-social elements and have used SHGs as a tool of self-development and economic empowerment. The main intention behind forming a Self Help Group is to create a common fund that can be used by its members for undertaking a collective economic activity or in times of need. As most members of the SHG come from the same socio-economic strata, issues they face back home are similar, almost all related to livelihood. In the absence of government or private sector jobs, entrepreneurship becomes a necessity to generate income for the household and to become self-reliant.
According to Economic Survey of Maharashtra 2015-16, the total savings of 7.2 lakh Self Help Groups (SHGs) was 903.8 crore. Swayamsiddha Foundation is an organisation that supports self-help groups. “Conservatively assuming that each SHG has just 10 members, the number of members engaged in this sector is more than ten million. Further, most of the members of SHGs are women. This points towards a huge engagement of women work force which if tapped properly could achieve twin goals of Self-employment and Women Empowerment”, says Mr. Vijay Joshi, Honorary Secretary at Swayamsiddha Foundation. However, sustaining even a small-scale business becomes a big challenge for women SHGs. Broadly, these challenges arise due to lack of knowledge related to technical and management aspects of running a business and certain socio-cultural factors.
1. Poor Marketing
When asked about the major challenges faced by SHGs during the CII-IWN’s NGO Mentoring Event in association with SIMSREE, Surekha, a member of a Self Help Group under Mahila Arthik Vikas Mahamandal (MAVIM) said “Marketing is a hurdle for us. We do not know how to market our products and the different channels used for it.” Marketing plays a crucial role to gain visibility for the products. Lack of effective marketing is a hindrance as this poses a challenge for getting sales orders for the products.
2. Lack of Product Standardization and Quality Issues
Most of the products made by SHGs are not uniform in their specifications and look & feel. This is so because most of the SHG products are hand-made, and hence it becomes difficult to maintain uniformity. Also, to cut costs, SHGs compromise on quality of raw materials used. This results in products of inferior quality thus affecting customer perception about the SHG.
3. Lack of Vision and Professionalism
Members of SHGs are mostly semi-literate or illiterate and are ignorant of basic rules pertaining to the formation and conduct of SHGs. This lack of awareness is further compounded by their myopic vision. Beyond immediate financial gains, they are blind towards the vast potential of what they can achieve through a SHG. Usually, running the business is of low priority for many members during festivals and vacation periods in spite of high demand. This lack of professionalism adversely impacts the SHG’s business prospects.
Solutions for betterment of SHGs
For the SHG movement to be successful, other players and stakeholders need to step in to support and promote it. Government, Non-Governmental Organizations (NGOs), Micro-finance institutions and even B-school students can make a major positive difference.
There are several pro-SHG schemes of the government. MAVIM is a nodal agency of the Government of Maharashtra to implement various women empowerment programs through SHGs. MAVIM is engaged as the implementation and technical partner for Maharashtra State Rural Livelihood Mission (MSRLM). It provides skill based training and offers 4% interest rate to SHGs. According to the Economic Survey, the Pradhan Mantri Jan-Dhan Yojana has been effective in bringing about financial inclusion, with about 1.35 crore bank accounts opened in the State with deposits of Rs. 1,863.06 crore.
NGOs and other intermediaries can play a key role in motivating, training and guiding the SHGs. They can organise campaigns to spread awareness related to government schemes, and knowledge related to marketing and finance. Take for example, Swayamsiddha foundation which acts as a launchpad for new SHGs. It mentors them and assists them in setting up their organizational structure and is actively involved in training and supporting them.
B-School students can get involved in the SHG movement, which can prove to be a win-win situation for both. Students can apply proven concepts of finance, marketing and product development to the working of SHGs while gaining practical insights into the challenges faced by them in sustaining their businesses at the grass-root levels.
SHGs can become a major catalyst in turning around the rural economy along with achieving the goal of women empowerment. However their success will depend on adequate support from passionately engaged stakeholders.
This post is authored by Nikhita Salian– Student Blogger for Creatively Unsettled.
“I am Mumbaikar who is currently pursuing my MBA in Systems from Sydenham Institute of Management Studies, Research and Entrepreneurship Education, inclined towards socially relevant activities that create a positive difference. A computer engineer by choice who loves reading fiction, writing articles and coding. Mahatma Gandhi’s famous words: Be the change you want to see in the world’ resonates with me.”