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Creating Sustainable Entrepreneurship through Self-help Group based

Microfinance Initiatives – A Case of Jharkhand, India

Dr. Bhaskar Bhowani

Assistant Professor, Department of Financial Management, Xavier Institute of Social Service (XISS), Ranchi,

Jharkhand, India. Email: bhaskarbhowani@rediffmail.com

Abstract

Poverty and unemployment is an important issue in developing economies. India accounted

for the largest number of people living below international poverty line in 2013, with 30

percent of its population living under $1.90 a day. According to the fifth annual employment-

unemployment survey at all-India level, about 77 per cent of the households were reported to

be having no regular wage or salaried person. It said the unemployment rate was estimated to

be 5 per cent at all-India level under the UPS (Usual Principal Status) approach.

Unemployment rate was 4.9 per cent in 2013-14 and 4.7 per cent (2012-13). Large scale

employment generation is one solution but the geometric progression in population growth

always outpaces such attempts. Nearly 70 percent of the India’s population live in rural areas

which is plagued by the ever increasing problem of unemployment. Decades of poverty

alleviation and employment generation efforts, from the Government has not yielded results

therefor there is an increased realization amongst development planners that rather than

employment creation, emphasis should be on self-employment and entrepreneurial

development. As stated, the need is more pronounced at the bottom of the pyramid where

millions require a helping hand. Bringing the much required, funding, savings and other

essential financial services within the reach of these millions is what we call as microfinance.

There are various models of microfinance deliverance, but, the current study focuses on the

Self-help Group (SHG) model as it has been considered to be one of the most successful credit

delivery model in developing nations. In India, the SHG aided Microfinancing model is

facilitated and promoted by various government and non-government Organisations (NGOs).

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They continue to nurture the SHGs until they become self-reliant. The study, in fact, looks

into this very aspect of sustainability in entrepreneurship development among the poverty

stricken, tribe dominated rural community, in the Southern Chotanagpur districts of the state

of Jharkhand, India.

This study is based on an intervention project implemented by Xavier Institute of Social

Service (XISS), Ranchi during 2013-2015. Post completion, a review study was

conceptualized and conducted to see its impact. The study is a mix of a survey of select areas

under the project, a review of relevant reports as secondary data and an analysis of select cases

which came to the fore during personal interviews and group discussions. The study concludes

that “capacity building through technical training and handholding by implementing agencies

is a must along with necessary linkages for sustainable entrepreneurial development” and

based on the findings there are ample opportunity and scope to scale up the project in other

districts of Jharkhand.

The study offers a wide range of perspective on the future potential of expanding the outreach

of interventions through SHG-microfinancing initiatives.

Keywords: Self-help Groups, Microfinance, Non-Government Organisations, Sustainability,

Hand-holding, Grameen Bank, Income Generating Activities.

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1. Introduction

The issue of sustainable economic development in India has been of concern since its

independence. The government has been investing huge amounts of money over the years in

search of a permanent remedy but has not been able to reap any meaningful outcome. India as

a nation has her own peculiar developmental challenges like that of population outburst,

unemployment, illiteracy and languishing infrastructure in rural areas. It has been realized in

recent years that there are limits to which government can singly promote development. In

order to bring sustainability in the development process, both the public and the private sectors

of the economy and every segment of the society needs to come together. One of the responses

to the challenges of development is the encouragement of entrepreneurial capabilities among

the marginalized and the poor living in rural India.

Entrepreneurship is the bedrock for any nation’s development, poverty eradication and

employment generation. But entrepreneurship cannot start all by itself, there has to be an

element of financing. Financing, however, through formal channels likes banks etc. has never

been easy for the poor and the illiterate so a simplified format of micro scale lending emerged

by the name of microfinance and today it has become one of the most effective vehicles for

building entrepreneurial capabilities and a tool for addressing poverty alleviation programs

through financial inclusion, socioeconomic empowerment, and self-sufficiency.

The concept of micro finance originated some four decades back when Professor Mohammad

Yunus, from Bangladesh introduced the concept of “Grameen Bank” in 1976 in Chittagong

University Campus on an experimental basis to study the framework of banking services for

the rural poor.1 The term ‘Grameen’ means ‘rural or village’ and these Grameen banks provide

loans to the poor who do not have access to formal financing and do not have anything to put

1 Mecha, Nyarondia Samson . “The Role of Microfinance on Youth Empowerment: An Examination of Theoretical

Literature. International Journal of Scientific and Research Publications, Volume 7, Issue No 2, February 2017.

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up as guarantee or collateral securities. Now, the question is how to provide financial services

to such class of people? The answer lies in the concept of Microfinance. So microfinance is

the business of giving tiny loans to people who do not have access to formal banking services.

According to the Task Force on Supportive Policy and Regulatory Framework for Micro

Finance set up by National Bank For Agriculture & Rural Development (NABARD), India in

November, 1998: Microfinance involves the provisioning of thrift, credit and other financial

services and products, with the aim to raise income levels and improve living standards of the

people below the poverty line by creating income generating activities (IGA). The Asian

Development Bank (2000) defines microfinance as the “provision of broad range of services

such as savings, deposits, loans, payment services, money transfers and insurance to poor and

low income households and their micro-enterprises”.2 The Micro Financial Sector

(Development and Regulation) Bill, India (2007) defines microfinance as the provision of

financial assistance and insurance services to an individual or an eligible client either directly

or through a group mechanism for an amount, not exceeding rupees fifty thousand in aggregate

per individual for small and tiny enterprise, agriculture, allied activities or an amount not

exceeding rupees one lakh fifty thousand in aggregate per individual for housing or other

prescribed purposes. The beneficiaries under this scheme may be landless labourers and

migrant labourers; artisans and micro entrepreneurs; disadvantaged cultivators of agricultural

land including oral lessees, tenants, and share croppers; and farmers owning not more than

two hectares of agricultural land.

According to the Indian Government there are about 363 million people living below the

poverty line in 2011-123 as the BPL level stands revised for an amount of earning lower than

INR.32 ($ 0.49) a day for those living in the rural areas and INR. 47 ($ 0.73) in towns and

2 Asian Development Bank (ADB). Rural Asia Study: Beyond the Green Revolution. Manila: ADB, 2000. 3 Planning Commission. Govt. of India. “Report of the Expert Group To Review the Methodology for

Measurement of Poverty”, Compiled by the Rangarajan Committee. Planning Commission, GOI, June, 2014

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cities.4 The World Bank, however, has a different statistics for the same period and according

to its latest report titled ‘Taking on inequality’ – Poverty and Shared Prosperity, there are over

224 million people living below the international poverty line of $1.90 a day.5 This figure is

revised to 179.6 million in 2015 which is equivalent to17.5% of the total world’s population.

India is not the leader when it comes to the percentage of its citizens living in poverty, it

leads in sheer volume just because of the size of its population. According to the report,6

one in every five Indians are poor. 30% of the world’s poorest children live here. 62% of

India’s poor live in the 7 low income states, of which Jharkhand is one of the state

contributing about 13%. 80% of India’s poor live in rural areas. 43% of the poor are

Scheduled Tribes and 29% are Scheduled Castes. The non-poor spend 47% of their income

on food whereas the poor spend 56%. 26% of the non-poor are illiterate whereas 45% of

the poor are illiterate. 37% of the non-poor have secondary education and above in contrast

to just 15% for the poor. Naturally the statistics with regard to ownership of assets and land

for the poor is strikingly less than that of the non-poor.

In light of the above statistics it is but imperative that microfinance initiatives are most

suited intervention for bringing about socio-economic transformation in the Indian sub-

continent and towards alleviating poverty in the rural areas. By virtue of a large and poor

population, India is one of the largest microfinance markets in the world.

In India, micro-finance has evolved considerably since the 80s, today it is mainly delivered

through two models, namely the SHG-Bank Linkage (SBL) model, which was championed by

4 Singh, Mahendra Kumar. "New poverty line: Rs 32 in villages, Rs 47 in cities." The Times of India, July 07,

2014. 5 PTI. "India has highest number of people living below poverty line: World Bank." Business News - Latest Stock

Market and Economy News India. October 03, 2016. Accessed May 28, 2017. http://www.businesstoday.in/

current/economy-politics/india-has-highest-number-of-people-living-below-poverty-line-world-bank/story

/238085.html. 6 IBRD IDA. "India's Poverty Profile." World Bank. May 27, 2016. Accessed May 28, 2017. http://www.

worldbank. org/en/news/infographic/2016/05/27/India-s-poverty-profile.

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the NABARD in the late 90‟s and the Micro-Finance Institution (MFI) model which resembles

the Bangladesh Grameen Bank model.

1. SHG-Bank Linkage (SBL) Model: The SBL model is an indigenous model of

microfinance in India which was conceptualized and initiated by NABARD in

1992, with a two year pilot project to link 500 SHGs. Its root though dates back to

1986 when in response to a proposal submitted by an NGO called MYRADA,

NABARD started putting in funds to the SAGs (Self Affinity Groups) under

MYRADA. In 1990 Reserve bank of India (RBI) accepted the SHG strategy as an

alternative credit model and it authorized the opening of bank accounts in the name

of groups. Today, opening accounts in the name of SHGs is part of the regular

operations in most banks. In 2015 there were about 103 million families covered

under the SHG-Bank Linkage Programe (SBLP) program with a total number of

79.03 lakh SHGs with a saving amount of INR. 13,691 crores. The average loan

disbursed per SHG for 2015-16 was reported at INR. 203,526, and an average loan

outstanding of INR 2,258 per SHG.7

2. Micro-Finance Institutions, the (MFI) Model: Micro-finance institutions are

organizations that are involved in the delivery of financial services to the unserved

segment of population that is otherwise considered as ‘un-bankable’. They may

range from social service focused value driven NGOs to profit-oriented NBFCs.

There has been an exponential growth in MFI activity in India over the past decade

as a plethora of NGOs and private organizations have converged into this field,

some having the genuine intention of socioeconomic advancement, while others

cashing in on the “fortune at the bottom of the pyramid”.8 The Indian Microfinance

Industry is dominated by NBFC MFIs with an 88% market share. There were 12

7 Sa-Dhan. The Bharat Microfinance Report 2016. New Delhi: Sa-Dhan, 2016. 8 Prahalad, C.K., and Stuart L. Hart. "Fortune at the Bottom of the Pyramid." Strategy+Business, No. 26 (2002).

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small MFIs (loan book less than INR 1b) another 22 medium sized MFIs (loan

book between INR 1b to 5b) and 22 large MFIs (loan book above INR 5b). Large

MFIs comprise 90% of the industries’ Gross Loan Portfolio (GLP). The GLP for

FY 2016 was INR 532.35 b. (53235 Cr.) 9 Due to the level of outreach the MFIs

need, there is a high operational cost associated with them and this is transferred to

the client in the form of higher interest rates, making the borrowing of money from

MFIs relatively costlier.

Self Help Groups (SHGs)

The term ‘self-help group’ or SHG can be used to describe a wide range of financial and non-

financial associations, but in India it has come to refer to a form of Accumulating Saving and

Credit Association (ASCA) promoted by government agencies, NGOs or banks. These groups

manage and lend their accumulated savings and externally leveraged funds to their members.10

More simply stated, The Self Help Group has been defined by NABARD as a group of about

20 people from a homogeneous class who come together for addressing their common

problems. They are encouraged to make voluntary thrift on a regular basis. They use their pool

resources to make small interest bearing loans to their members. The process helps them

imbibe the prioritization of needs, setting terms and conditions and accounts keeping. This

gradually builds financial discipline in all of them. They also learn to handle resources of a

size that is much beyond individual capacities of any of them. The bank loans are given

without any collateral and at market interest rates. The groups continue to decide the terms of

loans to their own members. Since the groups own accumulated savings are part and parcel of

9 ASSOCHAM in association with E&Y. “Evolving Landscape of Microfinance Institutions in India, July 2016”

- A Knowledge Report for the National Summit on Microfinance. New Delhi: ASSOCHAM, 2016. 10 Tankha, Ajay. “Self-help Groups as Financial Intermediaries in India: Cost of Promotion, Sustainability and

Impact.” A study undertaken for ICCO and Cordaid, The Netherlands. New Delhi: Sa-Dhan, August, 2002.

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the aggregate loans made by the groups to their members, peer pressure ensures timely

repayments.11

Mechanism of SHGs in India:

The idea is to organize the rural poor into small solidarity groups of 10-20 members (mostly

women) through a process of social mobilization, training and capacity building along with

the provisioning of income-generating assets through a mix of bank credit and government

subsidy. The main objective of the SHG concept is to improve the economic development of

the target groups and create facilitating environment for their social transformation. The SHGs

are formed either by private NGOs or through the intervention of the state administration. If it

is done through the administration, then the formation is under certain schemes facilitated by

the line departments on the recommendation of the Gram Sabha of the respective Village

Panchayat (lowest level of administrative unit under the local self-governance). The other

possibility is through the intervention of private NGOs & CBOs where the groups are formed

on similar principles with one member from one family. The groups so formed are regulated

by a mutually determined code of conduct and a minimal saving is initiated on a regular basis

to be deposited into a savings bank account. A pool of fund, thereby, accumulates which could

then be utilized for internal lending with an interest clause. This saving and lending practices,

over time helps the members learn the nuances of financial discipline. The SHPIs promotes

such SHGs that have demonstrated skills of credit handling of at least six months for bank

linkages. The banks, for augmenting the capital of the SHGs, provide loans (called as

revolving funds), in certain multiples of their accumulated savings with a minimum interest

clause. The group in turn lends to its own members at higher rates. If group is found to be

regular in its internal lending and successfully utilizes this revolving fund the SHG becomes

11 NABARD. "Ten years of SHG-Bank Linkage (1992-2002)." NABARD & MicroFinance 2001-2002,

Mumbai: 2002.

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eligible to receive further bank financing for income generating activities (IGAs). The group

members use collective wisdom and peer pressure to ensure appropriate use of fund and its

timely repayment. The SHG movement has gathered pace in countryside in building economic

self-reliance among the rural poor and empowering the vulnerable.

Research Methodology

The present study is descriptive in nature and is based on:

Review of secondary literature comprising of National Rural Livelihood Mission

(NRLM), Prime Minister Awas Yojana (PMAY) & Mahatma Gandhi National

Rural Employment Guarantee Act (MGNREGA) data released by the Government,

the annual reports of the partner NGOs and progress report of the project.

A qualitative assessment of the state of affairs through periodic field visits;

personal interviews and focus group discussion.

Review of select cases.

Objective of the Study:

As the paper focuses on “Sustainability” the aim is to highlight the fact that entrepreneurship

building is an ongoing process. And to bring about an enduring improvement in the socio

economic profile of the tribal community it is not sufficient to just facilitate financial

interventions but also to Suggest ways of “Capacity Building” & inculcating confidence

amongst the target group for the long run.

Based on the aforesaid understanding the primary objective therefore is to:

1. Verify whether the project was able to achieve its set objective or not.

2. To assess the opportunities and scope of scaling up of the project in other

districts of Jharkhand or similarly placed areas.

3. Suggest ways of strengthening of the SHGs and the Self-help Promoting

Institutions (SHPIs)

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Sampling:

In order to substantiate the above stated objective a random sampling from the Project’s target

population was made. The study area of the Project was limited to the two Tribal dominated

Divisions of South Chotanagpur and Kolhan (In all, the State of Jharkhand has 24 Districts

divided into 5 Divisions.)

The Project covers 8 Districts in the two said Divisions, but for convenience, only 5 Districts

have been picked up for further sampling. The Partner NGOs & CBOs operational in the said

5 districts are 12 in number and an average of 20 SHGs were picked randomly per Partner

NGO & (except for Sarwada & Mukunda where a normalization was done to compensate for

size). Since the number of villages and the number of members in the SHGs are different the

total number of families thus getting covered by the sample are not similar. A detailed outline

of the sample is provided in Table 1 below:

TABLE No. 1: Districts under the Study along with a list of Partner Organizations

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FIGURE No 1. Pictorial depiction of the study area

Profile of the Study Area:

Jharkhand (shown in Figure 1 above) is distinct from the rest of India due to its unique cultural,

geographical and ethnographical environment. Jharkhand is the 28th state of the Indian Union

and is majorly known for its rich mineral resources. The state occupies first position in the

production of Coal, Mica, Kainite and Copper in country. It has 40 percent of the nation's

mineral reserves. The major industries located in the state are that of Iron and Steel,

Nonferrous Industries, Fertilizers, Chemicals, Cement and Automobile.

Around 76% of the total population in the state live in rural areas. 26.3% of the population are

tribal of which 91.7% reside in villages. Agriculture is the main source of livelihood for the

people in the state but it suffers from several lacunas. The topography is roughly undulating

with terraced slopes. 29.47 per cent of the total land area is under agriculture, which is mono-

cropped with rice occupying the major area. Agriculture is mainly rain fed and the annual

rainfall of the region is about 1200 mm. Area under irrigation is only 14 per cent. Cultivation

is carried out in low land, which occupies 43 per cent of the total agriculture area. During

summer season the water table goes down and there is scarcity of water. This traditional, rain

fed and mono-cropping agriculture hardly makes surplus production possible and as a result

farmers have not been able to support their family’s food requirements and fodder for their

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cattle. Hence rural household are forced to migrate as alternative means of livelihood options

are not available. Various factors like low productivity, declining crop prices, declining labour

forces, migration and increasing urbanization are threats to the rural farmers which forces them

to quit farming and move to cities as cheap labourers (this is more pronounced during off farm

season). Hence a development strategy is needed which can facilitate small landholders,

landless and women to benefit from agriculture and small scale allied activities. The farming

community requires training and capacity building in agriculture and its allied activities so as

to sustain themselves and lead a quality life. The limited livelihood option in the tribal districts

of Jharkhand is a major concern for development organizations. Dependency on low yield

agriculture, single cropping pattern and lack of alternative income generating opportunities

during lean seasons have left the hapless population in a state of distress and deprivation.

Background of the Intervention:

Xavier Institute of Social Service, (XISS), Ranchi implemented this project “Enhancement of

Livelihood Opportunities” in the remote and rural pockets of Southern Chotanagpur,

Jharkhand, from April 2012 to address the issues of poverty in the area through an intervention

based on participatory planning, development of human resource and people’s collective

action. XISS partnered with 12 NGOs and CBOs (Community Based Organizations) for the

implementation of the said project. The intervention was designed to address issues like

identifying and nurturing the leadership potential of the community to lead their organizations,

promoting and strengthening community based organizations at village/ cluster level,

organizing and empowering them through SHGs for improving their socio-economic

conditions. Technical skill and training was provided to the SHGs in their opted livelihood

options. The training and hand holding support provided an opportunity to diversify their

livelihood activities and thus it improved their quality of living. The women SHGs were linked

to Government line departments and through the respective welfare programs they further

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availed the bank linkages (mostly Bank of India and State Bank of India) for micro credit

schemes and loans at the cheapest rate. SHGs were also motivated to further re-invest the

funds generated out of livelihood activities as revolving funds. The uniqueness of the project

is that it maintains the link of the indigenous people with their natural surroundings for their

livelihood. The project gave special emphasis to the sustainable management of natural

resources like water, land and the flora fauna. The Project supported the SHGs through

funding, capacity building, and continuous hand holding at the field level through the partner

NGOs. The project has been able to target the poor and the marginalized and local Self-help

Groups Promoting Institutions (SHPIs) which were instrumental in empowering the

vulnerable groups especially women in the villages.

The Income Generating Activities (IGAs) identified during the project tenure or Enhancement

of livelihood Opportunities were as follows: Lac cultivation on Flemengia Semialata , Kusum

(Schleichera oleosa) and Ber (Indian Jujube) (Ziziphus Mauritiana) trees, Vegetable

cultivation, Broiler Poultry Farming and duck rearing, Piggery, Goatry, Fishery and Fish seed

growing activities, Opening of Grocery shops, Eating joints and Hoteling for weekly markets,

Snacks marketing, Orchard with Red lady variety of Papaya etc. Other activities involved

Bamboo craft making, Mushroom growing, Leaf plate making, Fruit selling, Meat selling,

Tailoring, Dairy and Milk Production, Bangle Making out of Lac, Opening of ‘Fair price or

Public Distribution’ Shops, Opening Tent-houses, Marketing of Non forest Products (NFP)

etc.

The learnings were multifarious and the present study attempts to highlight the unique

problems of the marginalized in the tribal heartland and bring to the fore the experiences from

the project in addressing their poverty issues through group entrepreneurship building. The

purpose is to demonstrate how the SHG model can still be useful if we add the element of

sustainability to it.

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Being a tribe dominated society, some distinctive impediments manifested within the target

population. Centuries of exploitation, isolation and lack of acculturation coupled with

illiteracy have created an environment of mistrust and suspicion for the outside world. The

tribal population in this belt, therefore, do not easily accept outside interventions and more so

the Government ones. This phenomenon makes the operationalization of the initiatives in these

areas more challenging than the rest of India. The Government, through various initiatives

assisted in forming a number of SHGs and launched a multitude of schemes through NRLM,

SGSY etc. but studies have found that Government aided SHGs formed in the states like Bihar

and Jharkhand were short lived as compared to the other states, whereas NGO nurtured SHGs

were more sustainable. Moreover the overall statistics of SHGs in Jharkhand are pretty poor

as compared to the rest of the country. Even though the movement, has proliferated into a

massive scale with the total number of 79.03 Lakh SHGs in India in 2015-16 with an

outstanding loan of INR. 13,691.39 the total number of SHGs in the state of Jharkhand is only

99,326. This figure is much less than most of its sister states like West-Bengal, Orissa, Bihar,

UP, MP, Chhattisgarh, Maharashtra, Gujarat or even Rajasthan and Assam in the north-eastern

region. Southern states of AP, Karnataka, Kerala, Telangana and Tamil Nadu are way too

ahead.12

Findings:

In pursuance of the study objective certain parameters were determined to assess the impact

of the intervention after the completion of the project in 2015. The parameters for the purpose

are discussed below:

1. Capacity Building for carrying out of livelihood activities

2. Strengthening of Financial Status

3. Creation of Convergence with Government Line Department for IGAs.

12 NABARD, “Status of Microfinance in India, 2015-16”, Report. National Bank for Agriculture and Rural

Development (NABARD). Mumbai: Micro Credit Innovations Department, NABARD, 2016.

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4. Bringing about sustainability

5. Strengthening of the SHGs and Woman Empowerment

1. Capacity Building for carrying out of livelihood activities:

Since the inception, the project had endeavored to make the target population self-reliant

and had conducted series of training and capacity building programmes accompanied by

exposure tours, with regard to skill and knowhow development. Training on Fishery and

fish-seed production activities, Poultry farming, Goatery, Piggery, Dairy, Scientific

cultivation of Lac, Cultivation of Mushroom, Vegetables, Baby Corn, Red-lady variety of

Papaya, Semialata Nursery, System of Rice Intensification (SRI) method of paddy

cultivation, Training on Vermi-Compost, Low cost Green Net Shed Nursery, Orchard

growing etc. The groups were also given training on non-conventional source of IGAs like

opening of Grocery Shop, Fair price Shops, Tent-Houses, Restaurant installation for

weekly market, Snack Marketing, Bangle making, Tailoring, Selling of NFPs etc. Besides

they were also given trainings on SHG Accounts Maintaining, Training on Panchayati Raj

Institution & local Self Governance and educating them on their rights and facilities etc.

Figure No.2 below tries to depict the share of households under the control of 12 selected

NGOs and CBOs emanating from the 20 randomly selected SHGs from each one of them.

FIGURE No 2. Total No. of Families under the 12 NGOs & CBOs drawn from 240 sample SHGs.

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In this manner there are a total of 3,354 families under the current survey and out of which

47% i.e. 1,572 families are reporting active engagement in IGAs of some or the other kind,

Whereas, the remaining 53% i.e. 1,782 families have not been able to demonstrate any

sustainable form of IGAs. A detailed breakup can be seen in Table No.2 below.

TABLE No. 2. Sample population of 3,354 families under the 12 NGOs & CBOs engaged/ not

engaged in IGAs:

Chart No. 3 given below depicts the information related to 1,572 households who have an

active engagement in one or the other of the above stated IGAs. This shows that the

interventions have created sufficient impact in just three years in changing the lives of

about 50% of the target population.

Figure No 3. Gives the break-up of 1,572 families who have taken up various kinds of

IGAs:

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2. Strengthening of Financial Status:

Table No.3 shows that most of the SHGs have been able to mobilized savings amongst the

members but have not been able to open significant number of savings bank accounts

through their interventions. NGO facilitated Bank Linkage is only 7% that is only about

231 families out of 3,354 families who has formal bank accounts opened through the 12

SHPIs in the study area. The other bank linkages are through the Government Line

Departments discussed in the next section.

The financial capacity of all the women groups numbering to 249 was INR. 52, 90,602 (till

March, 2015). This financial strength allowed INR. 1,600 to each member. As per the ‘bye

laws’ of women SHGs, one member could take loan up to 4 times of their saving, and as

such one can avail loan up to INR. 6,400. The overall group internal savings accumulated

over 3 years ranged between INR 1.9 lakhs to about INR 9.5 lakhs. On an average 55% of

the members have taken loans and utilized the group savings. But, it could be observed

from Table No.3 that about 50% of the loans taken are for general consumption and not

for productive purposes. The interest earning and the recovery ratios are impressive, but

loans from Banks for productive purposes have not picked up. The limited earnings and

savings of the members have discouraged opening of bank accounts. Such findings may

also have resulted because of a shorter time horizon since the intervention. In spite of the

limited financial strength the finance utilization pattern of SHG members clearly

reflected positive trends.

Inter loaning within group during the last 3 years was more than 100%, this means

that the loan consumption capacity of group as well as members have enhanced.

Loan transaction trend indicated that the productive loan had gone up to 60% from

25% which was during April, 2013.

Loan recovery rate was 60% which is satisfactory here as the partner organization

were asked to pay attention to enhance the recovery rate.

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Loan transaction trend indicated that 53% of total members were taking loan.

Considering the short span of 3 years of the project it was satisfactory, but still is

needed to pay attention.

TABLE No.3: Financial Status and Bank Linkage:

3. Creation of Convergence with Government Line Department for IGAs.

Another primary concern for all SHPIs is to structure and facilitate a mutually beneficial

working relationship between the poor and the Panchayati Raj Institutions (PRI) for

strengthening of Local Self Governance and empowerment. The benefits to be received

from various welfare schemes launched by Government of India (GOI) like that of the

National Rural Livelihoods Mission (NRLM) which replaces the erstwhile Swarnajayanti

Gram Swarozgar Yojana (SGSY) requires bank linkages and that is established directly by

the concerned line departments. As such, the task of the NGOs or the SHPIs is to educate

the poor and facilitate a linkage for availing the scheme related benefits. Table No. 4

provides a snapshot of the findings related to such linkages.

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TABLE No. 4: Linkage with Govt. Line Departments and Banks:

4. Bringing about Sustainability:

Table No. 5 depicts the Capital Invested by the members over a period of 3 years, Income

Generated per Month and the Stage in which their Business is, i.e. to say that how long has

their business been running? Findings summarized in Table No.5 reflects that 28% (1572

families out of 3,354) are involved in business and 26% (414 out of 1,572) families are at

a sustainable stage. Their business enterprise is in a continuous process and so far they

have built up capital and assets respectively. The food security of these families is now

assured. Another 21% families had made investments of more than INR. 20,000, 44%

families had been making investment in between INR 5,000 to INR 20,000 and 35% of the

respondents are such families who were making bare minimum investment of less than

INR 5000, but whatever it is, the target group has been sensitized and the demonstration

effect is also playing a significant role in bringing the reluctant beginners into a head start.

TABLE No. 5: Financial Status and Bank Linkage:

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5. Strengthening of the SHGs and Women Empowerment:

The capacity of Partner Organizations and their staff in aspects of planning, monitoring

and facilitation process and different income generating activities has improved

substantially. They were able to rejuvenate the SHGs and improve their operations. Further

through different capacity building events, they were now prepared to undertake livelihood

enhancement opportunities. Besides 3 years of intensive training on IGAs, conduction of

meetings (which is a regular phenomenon now), formulation of by-laws and its adherence,

record keeping and accounting procedures, various linkages, awareness drives etc. have

made the members much more confident and enthusiastic. The power of unity, networking

and resources at their disposal has given a boost to their personality and they are no more

vulnerable. They have made a beginning and there is no looking behind.

CASE STUDIES:

Besides the quantitative observations discussed in the earlier section, some qualitative

aspects have also been reviewed. The interventions have created long lasting impacts on

the lives of people and an effort has been made to bring to light some of the experiences

through a set of select cases from amongst the target population.

1. The case of “Sarjombaha Jiling Buru”, a woman SHG is a glowing example of how

even the poor, penniless and the illiterate tribal women of the remote countryside

can associate to handle commercial ventures and convert it into a successful

enterprise: The group came into being on 10.05.2012 having a total of 14 members.

They decided to open a grocery shop with their savings in the SHG. Through common

consensus, the responsibility of running the shop was entrusted to two members of the

group- Ms.Emleena Som and Ms.Shantimani Kongari. They invested INR.7000 in the

grocery shop and every month they were able to make a profit of INR.2000-INR.2200.

Of this profit, they deposit INR.800 with the SHG out of which INR.400 was meant for

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their further investment. The remaining INR1200 of the profit amount, INR 600 was

given to each member running the grocery shop. The other members of the SHG helped

in purchasing items from the market and they were reimbursed the transportation and

other incidental costs. The village being remote and extremist infested remains cut-off

from the block headquarter, Torpa. Since there was no market in the village, the

villagers had to traverse a distance of at least 15kms for buying even small things like

a match-box. Thus, after the setting up of the shop, the villagers started buying their

essential from the same. Although the profits from the shop had initially been less than

expected, the women are full of enthusiasm and wish to pursue it with even more

diligence.

2. A similar story of another woman SHG - Champa Gitilpeedi has been noted for a

flourishing business effort of running a tent house. The group arranged all the

necessary capital items for establishing the tent house with the help of their savings.

They are now renting out items on regular basis not only within their own village but

also to nearby villages. There are no dearth of social occasions like marriages etc. and

profits are on the rise. The charges are not less that INR. 500 per event. They also lend

out to their own SHG members at concessional rates and there is a win-win situation

for everyone. This village too, is remotely located and does not have a market-place

nearby. So this venture was a welcome move for most.

3. Women and Men alike have come to benefit out of welfare interventions and a good

example would be the case of Jagna Barjo from Komrora Bagutola under Komrora

panchayat of Sonua Block in West Singhbhum district. This case is related to

availing of benefits under the Government sponsored welfare scheme of MGNREGA

- (Mahatma Gandhi National Rural Employment Guarantee Act). For the first time

Jagna undertook the cultivation of vegetables for commercial purposes because of the

scheme assistance. He was quite a poor man and apart from a piece of land, he owned

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no productive assets. Due to lack of irrigation facilities, the agricultural produce from

his land could sustain his family barely for 3-4 months in a year. In lean times, he had

to depend on daily wages earned as a labour for meeting the requirements of his family.

On many occasions when he was unable to find work, his family did not have sufficient

food to eat. Also, the wages earned were so low that it could hardly meet the basic

requirements. 45 year old Jagna Barjo is a member of an organized VWDC group

(Village Watershed Development Committee) under the PACS Programme (Poorest

Area Civil Society Program). His wife too is a member of a Self-Help Group in the

village. With all the available interventions from the SHG and through the Gram

Panchayat he was able to get assistance under the scheme of MGNREGA and a well

was constructed on his land in 2012-13 for the purposes of irrigation. He then started

cultivation of vegetables on his land and through the sale of vegetables grown, he was

able to earn around INR.600 to 650 every week which made him financially stable.

This, in turn, helped him in ensuring food security of his family of three children and

his wife.

4. Madki Barjo, another example of extreme poverty from the same village and block

had benefited under the scheme of MGNREGA, wherein he was able to get a pond

constructed in the plot of land he inherited from his forefathers. This led him to

undertake fish rearing business and at the same time attend to agriculture and

vegetable growing. His dependency on Monsoon reduced and his income flourished.

Earlier they had difficulty in arranging even two square meals a day but now the pond

yields him a profit of INR. 6,000 per month. In addition to INR. 600-650 every week

through the sale of vegetables. Madki Barjo is now very happy that he no longer has

to live in extreme poverty. These examples are not about poverty elevation alone but

also about a permanent answer to the common rural problem.

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5. A heart rending case of Bharosi Kandulna of village Pinding, block Gudari

(W.Singhbhum), is worth discussing as it brings to light how the poor tribal lead

their lives in the inaccessible and remote villages of South Chotanagpur districts of

Jharkhand and how interventions are changing their lives: 35 year old Bharosi and

her husband is 40 years old have 5 children. Initially she got two of her children

admitted in a school at Goilkera but had to subsequently drop out as they could not

afford the fees. There was extreme scarcity of food and did not have even rice to eat.

They used to eat gangaikachawal (a local staple food) as a substitute. It was during

such distressing period that Bharosi became a member of the SHG formed by

“FEMALE” and she along with her husband obtained work under the MGNREGA job

guarantee programme on a road construction project.. Bharosi got work for 45 days

and her husband for 55 days. They received wages worth INR. 12,000 for their services

rendered under the scheme in the year 2013. Thereafter she took a loan of INR. 3000

from the SHG. Thus, she had a total of INR. 15,000 as her capital from which she

bought a bicycle worth INR. 3000. It was on the bicycle that Bharosi and her husband

used to come to the market at Rania which is at least 25 kms away from the village.

The road leading from the village to Rania winds through mountains, rivers, forests,

and narrow by-lanes. From Rania they used to buy paddy and load it on their bicycle

and travel back to their village Pinding. From paddy, they used to extract rice and

started selling it in the market. While her husband rode the bicycle, Bharosi used to sit

pillion with a sack on her head containing such items as soap, detergent, spices, salt,

gutkha and other such items. Earlier they used to make a profit of INR. 200-300 which

has now increased to INR. 500-600. The increase in resources, enabled her in re-

admitting her children in the same school which had earlier turned them out. The

admission of her children filled her with a new zeal and she started going to Rania

twice to bring items which increased her earning more than twice- she now earns INR.

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1400-INR.1600 in the weekly market. Now she has all necessary household items-

there are warm clothes for the children, food has become balanced and nutritious for

now they can afford to eat pulses and vegetables. They can afford to get themselves

treated when sick. They are now no longer dependent on anybody for their financial

needs.

This is what interventions does to lives of people. In the aforesaid context changes might

not have been dramatically and striking but a turnaround is slowly brought into the lives

of people.

Discussion:

Based on the literature review, and findings it seems that there is a scope of replicating and

scaling up the project in other districts of Jharkhand as well. However there can be some

challenges in its implementation but they can be overcome. Some of the difficulties are

discussed hereunder:

In some instances, (mostly in remote Naxal infested locations) there is a reservation

and a lack of earning desire due to the fear of levy imposition by the Naxals.

[Naxals are band of extremists.]

Bringing about a radical change in the attitude is very difficult and sensitizing them

to modern methods is also a challenge.

Villagers does not accept or adopt new technology immediately

Brokers control the poultry market and they influence the prices adversely.

Marketing of poultry birds/chicken during the month of “Sawan” is very tough –

Sawan is a month when most ‘Hindus’ would not eat non-vegetarian food for a

month.

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Fish seed growing activity is technically tough. If one is capable in caring and

taking precautionary measures and spawn survives than the profit margin is also

very good.

Conclusion

The survey observation and review of relevant secondary sources have pointed out that

the project has been fairly successful in bringing about the desired outcomes. It had

largely fulfilled its objectives and has been able to justify the time, methods, efforts

and resources allocated to it. More importantly, it has been able to touch and transform

the lives of hundreds of poor people through its intense intervention and it does call

for further scaling up.

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