National level workshop on Sustainability of SHGs

- Synthesis of Parallel session I

Parameters of SustainabilityParameters of Sustainability

• Long term continuation of an institution.• Owned, controlled and managed by People.• Appropriate systems and processes.• Scaling up for sustenance • Established partnership with Mainstream• Multiple products and services responding to needs• Meeting its own costs.• Fulfilling the developmental needs of the members.• Identity

Dimensions of SustainabilityDimensions of Sustainability• Institutional

- Shared purpose, structure, strategy, staff, systems, style and shared values……

• Financial - Deepening and scaling up financial services (saving, credit and insurance)- Ability to mobilise resources for self growth

• Developmental -Achieving poverty reduction-Enhancing quality of life

UsuryUsury

Sustainability of members of SHGs are more important rather than Sustainability of MCIs (Micro Credit Institutions)

Policy level changes requiredPolicy level changes required

• While financing MCIs( Micro Credit Institutions) , cap on the While financing MCIs( Micro Credit Institutions) , cap on the interest rate to be Fixed on the ultimate beneficiaries shall interest rate to be Fixed on the ultimate beneficiaries shall be prescribedbe prescribed

• Regulatory bodies like RBI or NABARD shall not insist on Regulatory bodies like RBI or NABARD shall not insist on individual account when they are already part of Financial individual account when they are already part of Financial inclusion through SHGs.inclusion through SHGs.

• Development oriented SHG Federations should be Development oriented SHG Federations should be encouraged by banks and funding agencies.encouraged by banks and funding agencies.

• No subsidies.No subsidies.

Implementation level changes for Implementation level changes for Sustainability of SHGsSustainability of SHGs

• Federations should be discouraged to do lending activity as Federations should be discouraged to do lending activity as they do not have capacity for managing portfolio.they do not have capacity for managing portfolio.

• Members of SHGs should have same socio economic statusMembers of SHGs should have same socio economic status• NGOs should not operate on Project mode. It should NGOs should not operate on Project mode. It should

operate on Programme mode.operate on Programme mode.• Capacity of NGOs should be duly assessed on infrastructure, Capacity of NGOs should be duly assessed on infrastructure,

core competence, past experience before providing core competence, past experience before providing promotional support.promotional support.

• MIS systems needs to be strengthened to avoid duplicationMIS systems needs to be strengthened to avoid duplication• Every stake holders should treat each one as partners to Every stake holders should treat each one as partners to

ensure effective convergence of efforts.ensure effective convergence of efforts.

Implementation level changes for Implementation level changes for Sustainability of SHGsSustainability of SHGs

• Timely, adequate loans Timely, adequate loans • SHGs should be treated as business propositions and not as SHGs should be treated as business propositions and not as

beneficiaries/charity modebeneficiaries/charity mode• Capacity of building of SHG Members, leaders, Promoting Capacity of building of SHG Members, leaders, Promoting

NGO.NGO.• Banks should give more focus for SHGs rather than MCIs.Banks should give more focus for SHGs rather than MCIs.• Banks should give more focus for BC and BF model Banks should give more focus for BC and BF model

effectively rather than supporting MCIs.effectively rather than supporting MCIs.• Capacity of the Community to be built up to the extent that Capacity of the Community to be built up to the extent that

they are able to take up their own issues.they are able to take up their own issues.

Implementation level changes for Implementation level changes for Sustainability of SHGsSustainability of SHGs

• MCIs activities need to be properly documented and placed MCIs activities need to be properly documented and placed before NABARD/RBI/Govt.before NABARD/RBI/Govt.

• Major NGOs shall set up resource centre in North India for Major NGOs shall set up resource centre in North India for spreading SHG Movementspreading SHG Movement

• In the regions where the movement have not picked up to the In the regions where the movement have not picked up to the desired level, Development programmes can be routed through desired level, Development programmes can be routed through SHGs.SHGs.

• SHGs should be temple of development at the grassroots SHGs should be temple of development at the grassroots democracydemocracy

• SHG should decide what they want to do. There should not be SHG should decide what they want to do. There should not be external pressure. It should be member driven.external pressure. It should be member driven.

Thank YouThank You