{"id":18937,"date":"2023-12-08T17:43:54","date_gmt":"2023-12-08T17:43:54","guid":{"rendered":"https:\/\/edukemy.com\/blog\/?p=18937"},"modified":"2024-02-26T10:23:51","modified_gmt":"2024-02-26T10:23:51","slug":"micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec","status":"publish","type":"post","link":"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/","title":{"rendered":"\u201cMicro-Finance as an Anti-poverty vaccine, is aimed at asset creation and income security of the rural poor in India\u201d. Evaluate the role of Self-Help Groups in achieving the twin objectives along with empowering women in rural India. (250 Words, 15 Marks)"},"content":{"rendered":"<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><a href=\"https:\/\/edukemy.com\/upsc\/upsc-gs-advance-and-mentorship-program-ampcsat?utm_source=Blog&amp;utm_medium=Link&amp;utm_campaign=GS+Advanced\" target=\"_blank\" rel=\"noreferrer noopener\"><img fetchpriority=\"high\" decoding=\"async\" width=\"1280\" height=\"300\" src=\"https:\/\/edukemy.com\/blog\/wp-content\/uploads\/2024\/07\/Attempt-our-Daily-Weekly-Current-Affairs-Quiz-now-8.png\" alt=\"\" class=\"wp-image-43397\" srcset=\"https:\/\/edukemy.com\/blog\/wp-content\/uploads\/2024\/07\/Attempt-our-Daily-Weekly-Current-Affairs-Quiz-now-8.png 1280w, https:\/\/edukemy.com\/blog\/wp-content\/uploads\/2024\/07\/Attempt-our-Daily-Weekly-Current-Affairs-Quiz-now-8-1170x274.png 1170w, https:\/\/edukemy.com\/blog\/wp-content\/uploads\/2024\/07\/Attempt-our-Daily-Weekly-Current-Affairs-Quiz-now-8-585x137.png 585w\" sizes=\"(max-width: 1280px) 100vw, 1280px\" \/><\/a><\/figure><\/div>\n\n\n<p>Micro-Finance, through Self-Help Groups (SHGs), acts as an anti-poverty vaccine in rural India, fostering asset creation, income security, and empowering women. SHGs facilitate financial inclusion, skill development, and entrepreneurship, breaking the cycle of poverty and enhancing the socio-economic status of rural communities, especially women.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p><strong>UPSC Mains General Studies Paper \u2013 2 Mains 2020<\/strong><\/p><\/blockquote>\n\n\n\n<p><strong><a href=\"https:\/\/edukemy.com\/blog\/upsc-mains-civil-services-ias-exam-question-paper-2021\/\" target=\"_blank\" rel=\"noreferrer noopener\">U<\/a><a href=\"https:\/\/edukemy.com\/blog\/upsc-mains-civil-services-ias-exam-question-paper-2020\/\" target=\"_blank\" rel=\"noreferrer noopener\">PSC Mains Civil Services IAS Exam Question Paper \u2013 2020<\/a><\/strong><\/p>\n\n\n\n<p><strong>Tags:&nbsp; <\/strong>Development processes and the development industry \u2014the role of NGOs, SHGs, various groups and associations, donors, charities, institutional and other stakeholders.&nbsp;&nbsp;<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_73 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<label for=\"ez-toc-cssicon-toggle-item-69d4c9572a408\" class=\"ez-toc-cssicon-toggle-label\"><p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-cssicon\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d4c9572a408\"  \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#Approach\" title=\"Approach\">Approach<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#Answer\" title=\"Answer\">Answer<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#Micro-Finance_An_Anti-poverty_Vaccine\" title=\"Micro-Finance: An Anti-poverty Vaccine&nbsp;\">Micro-Finance: An Anti-poverty Vaccine&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#Self-Help_Groups_SHGs_and_Micro-Finance\" title=\"Self-Help Groups (SHGs) and Micro-Finance\">Self-Help Groups (SHGs) and Micro-Finance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#In_case_you_still_have_your_doubts_contact_us_on_9811333901\" title=\"In case you still have your doubts, contact us on 9811333901.&nbsp;\">In case you still have your doubts, contact us on 9811333901.&nbsp;<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/edukemy.com\/blog\/micro-finance-as-an-anti-poverty-vaccine-is-aimed-at-asset-creation-and-income-security-of-the-rural-poor-in-india-evaluate-the-role-of-self-help-groups-in-achieving-the-twin-objec\/#Visit_our_YouTube_Channel_%E2%80%93_here\" title=\"Visit our YouTube Channel &#8211;&nbsp;here\">Visit our YouTube Channel &#8211;&nbsp;here<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Approach\"><\/span>Approach<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>In Introduction, try to discuss Microfinance in brief.<\/strong>&nbsp;&nbsp;<\/li><li><strong>In Body,<\/strong>&nbsp;&nbsp;<ul><li><strong>Micro-Finance as an anti-poverty vaccine.<\/strong>&nbsp;&nbsp;<\/li><li><strong>Discuss SHGs Twin Objectives &#8211; poverty alleviation and women empowerment.<\/strong>&nbsp;&nbsp;<\/li><\/ul><\/li><li><strong>In Conclusion, try to suggest how the goal of financial inclusion can be realized by Microfinance<\/strong>&nbsp;&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Answer\"><\/span>Answer<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Microfinance is the practice of providing the poor with credit, savings and insurance facilities to set up or to expand Income Generating Activities relating to agriculture and its allied activities and non-farm sector, and thereby reducing poverty and improving the standard of living. The basic feature of microfinance is that the loans are given without any security.&nbsp;&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Microloans: <\/strong>These loans are significant as these are provided to borrowers with no collateral.&nbsp;&nbsp;<\/li><li><strong>Microsavings: <\/strong>These accounts allow entrepreneurs to operate savings accounts with no minimum balance. These help the users to instill financial discipline and develop an interest in saving for the future.&nbsp;&nbsp;<\/li><li><strong>Microinsurance: <\/strong>It is a type of coverage provided to borrowers of microloans. These insurance plans have lower premiums than traditional insurance policies. It addresses all kinds of risks that people of low income groups or poor people face globally.&nbsp;&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Micro-Finance_An_Anti-poverty_Vaccine\"><\/span>Micro-Finance: An Anti-poverty Vaccine&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Economic growth:<\/strong> Microfinance services contribute to the improvement of resource allocation, promotion of markets, and adoption of better technology; thus, microfinance helps to promote economic growth and development.&nbsp;<\/li><li><strong>Income security: <\/strong>It assists the communities of the economically excluded to achieve a greater level of asset creation and income security at the household and community level.&nbsp;<\/li><li><strong>Small entrepreneurs:<\/strong> It aims to dispense access to the capital to small entrepreneurs.&nbsp;<\/li><li><strong>Alleviating Women&#8217;s Status in Society:<\/strong> They provide a significant contribution to gender equality and women&#8217;s empowerment through their contribution to women\u2019s ability to earn an income and in turn initiate a wave of change in economic empowerment, and wider social and political empowerment.&nbsp;<\/li><li><strong>Reach for Society Building:<\/strong> Aimed at pro-poor development and civil society strengthening, Micro-finance programmes not only give women and men access to savings and credit, but reach millions of people worldwide bringing them together regularly in organized groups.&nbsp;&nbsp;&nbsp;<\/li><li><strong>Goal of Self- Reliance<\/strong>: Micro finance is a tool to overcome exploitation, create confidence for economic self-reliance of the rural poor, particularly among rural women. Rapid progress in SHG formation has now turned into an empowerment movement among women across the country.&nbsp;&nbsp;&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Self-Help_Groups_SHGs_and_Micro-Finance\"><\/span>Self-Help Groups (SHGs) and Micro-Finance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>SHGs are informal associations of people who choose to come together to find ways to improve their living conditions. In the last few decades, SHGs have emerged as the most effective mechanism for delivery of microfinance services to the poor in general and women in particular. The Genesis of SHG in India can be traced to the formation of the Self-Employed Women\u2019s Association (SEWA) in 1972.&nbsp;<\/p>\n\n\n\n<p><strong>These groups can act as microfinance institutions and help in alleviating the conditions of the rural poor for the following reasons:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>People will have faith in and among themselves.&nbsp;&nbsp;<\/li><li>Rates of interest can be fixed by considering the State of the individual getting finance.&nbsp;&nbsp;<\/li><li>Repayment of loans becomes comparatively easier.&nbsp;&nbsp;<\/li><li>Skill development program taken up by SHGs improves employability of members involved.&nbsp;&nbsp;<\/li><li>SHGs work on reducing rural poverty by lifting people from below the poverty line and generating assets for them. There is positive correlation between SHGs and poverty can be inferred from the fact that southern states with high numbers of SHGs (71%) have an average poverty rate at 9% as against the nation&#8217;s average of 21%.&nbsp;&nbsp;&nbsp;<\/li><\/ul>\n\n\n\n<p><strong>Women Empowerment: <\/strong>SHGs provide for equality of opportunity for women in economic activities. It is evident that this has resulted in the social upliftment of women\u2019s status. They are instrumental in building Social Capital among the poor, especially women.&nbsp;<strong> <\/strong>Some of the initiatives in this direction are as follows:&nbsp;&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Kudumbashree Mission in Kerala:<\/strong> Women under Kudumbashree, are organized into Neighborhood Groups (NHGs). Thrift and Credit Societies are set up at NHG level to encourage the poor to save and to avail easy credits.&nbsp;&nbsp;<\/li><li><strong>SHG-Bank Linkage Programme (SBLP)<\/strong> was launched in 1992 by NABARD. It envisaged an amalgamation of the formal financial sector and informal sector. Because of this, the formal financial institutions in India have entered microfinance in a massive way.&nbsp;&nbsp;<\/li><li><strong>SHG development through NABARD:<\/strong> Under the SHG-Bank linkage programme, NABARD provides refinance and promotional support to Banks for credit disbursement. A full-fledged project enabling SHGs to open bank accounts based on a simple inter-se agreement, was launched by NABARD in 1992 involving a partnership among SHGs, banks and NGOs.&nbsp;&nbsp;<\/li><li><strong>Rashtriya Mahila Kosh: <\/strong>It was set up with the intention to facilitate credit support to poor women for their socio-economic upliftment by providing loans in a quasi-formal credit delivery mechanism. The Kosh lends with a unique credit delivery model \u201cRMK \u2013 NGO-SHG Beneficiaries\u201d.&nbsp;&nbsp;<\/li><li><strong>SEWA: <\/strong>The Self Employed Women&#8217;s Association (SEWA) is a membership-based organization created in 1972 combining labour, women, and cooperative movements, aimed at organizing self-employed women in the informal economy and assisting their collective struggle for social justice, equality, and fair treatment.&nbsp;&nbsp;<\/li><li><strong>Myrada: <\/strong>MYRADA is a non-government organization started in 1968 working in backward and drought-prone areas. The organization was registered as \u201cMysore Resettlement and Development Agency\u201d under the Mysore Societies Registration Act 1960 in the year 1968.&nbsp;&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For equitable and sustainable development in rural India, financial inclusion supported by MFIs plays an important role. It strengthens India\u2019s ability to post fast economic growth with a focus on reducing poverty and empowering women.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image size-full is-resized\"><a href=\"https:\/\/edukemy.com\/upsc\/upsc-essay?utm_source=Blog&amp;utm_medium=Banner&amp;utm_campaign=Essay\" target=\"_blank\" rel=\"noreferrer noopener\"><img decoding=\"async\" data-src=\"https:\/\/edukemy.com\/blog\/wp-content\/uploads\/2024\/06\/UPSC-Essay-Course-1280\u00d7300-1-3.svg\" alt=\"\" class=\"wp-image-42688 lazyload\" width=\"781\" height=\"182\" src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" style=\"--smush-placeholder-width: 781px; --smush-placeholder-aspect-ratio: 781\/182;\" \/><\/a><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"In_case_you_still_have_your_doubts_contact_us_on_9811333901\"><\/span><strong>In case you still have your doubts, contact us on 9811333901.<\/strong>&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For UPSC Prelims Resources,&nbsp;<a href=\"https:\/\/edukemy.com\/upsc-cse-prelims-resource-centre\" target=\"_blank\" rel=\"noreferrer noopener\">Click here<\/a><\/p>\n\n\n\n<p>For Daily Updates and Study Material:<\/p>\n\n\n\n<p>Join our Telegram Channel &#8211;&nbsp;<a href=\"https:\/\/t.me\/WithEdukemy4IAS\" target=\"_blank\" rel=\"noreferrer noopener\">Edukemy for IAS<\/a><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>1. Learn through Videos &#8211;&nbsp;<a href=\"https:\/\/bit.ly\/3vOD8sU\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a><\/li><li>2. Be Exam Ready by Practicing Daily MCQs &#8211;&nbsp;<a href=\"https:\/\/bit.ly\/3Q9z2nF\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a><\/li><li>3. Daily Newsletter &#8211; Get all your Current Affairs Covered &#8211;&nbsp;<a href=\"https:\/\/bit.ly\/3bE2y5J\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a><\/li><li>4. Mains Answer Writing Practice &#8211;&nbsp;<a href=\"https:\/\/bit.ly\/3mZuVxl\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a><\/li><\/ul>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Visit_our_YouTube_Channel_%E2%80%93_here\"><\/span>Visit our YouTube Channel &#8211;&nbsp;<a href=\"https:\/\/www.youtube.com\/@ShabbirsEduKemyforIAS\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n","protected":false},"excerpt":{"rendered":"<p>Micro-Finance, through Self-Help Groups (SHGs), acts as an anti-poverty vaccine in rural India, fostering asset creation, income security, <\/p>\n","protected":false},"author":17,"featured_media":18945,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_eb_attr":"","om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[185],"tags":[186,299,354,142,232,145,353],"class_list":["post-18937","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-upsc-mains-solved-papers","tag-general-studies-1","tag-geography-general-studies","tag-history","tag-previous_year_questions","tag-upsc","tag-upsc-mains-question-paper","tag-upsc-model-answers"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/posts\/18937","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/comments?post=18937"}],"version-history":[{"count":6,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/posts\/18937\/revisions"}],"predecessor-version":[{"id":29889,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/posts\/18937\/revisions\/29889"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/media\/18945"}],"wp:attachment":[{"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/media?parent=18937"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/categories?post=18937"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/edukemy.com\/blog\/wp-json\/wp\/v2\/tags?post=18937"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}