Under its Aajeevika-National Rural Livelihood Mission (NRLM), the government plans to formalise select SHG groups so that they can avail higher loans.
The government is targeting to help 3-5 lakh women Self Help Groups (SHG) in order to give a push to entrepreneurship among rural women. The Ministry of Rural Development aims to elevate women SHGs’ nano enterprises to micro enterprises, The Indian Express reported. Under its Aajeevika-National Rural Livelihood Mission (NRLM), the government plans to formalise select SHG groups so that they can avail higher loans and ramp up their enterprises. Launched in 2011, the NRLM has empowered SHGs by entitling them to Rs 10 lakh each as loan without collateral over a period of six to eight years.
The government recently undertook a stock taking exercise in order to find women SHGs who have already used at least Rs 7 lakh so far as these SHGs demonstrate potential for a bigger market for their products, Ministry officials told the national daily. Out of the total 52 lakh women SHGs, which cover six crore women in the country, over 3 lakh SHGs were identified that qualified the criteria.
While the women SHGs initially deploy these loans for purposes such as paying off their debts, for consumption, or children’s education, “once these are taken care of, they then move on to economic activity,” the newspaper cited a Ministry official as saying. Formalizing these SHGs has been a part of the government’s 100 days agenda as these groups need better credit linkage to scale up their operations. “They are, at the most, able to come and display their products at national level exhibitions, but beyond that to scale it up, they needed better credit,” the newspaper reported.
The government also launched a campaign as a part of its 100-days agenda in order to get these self groups registered as micro-enterprises. The government is trying to elevate these nano-enterprises to micro and small enterprises via higher-order bank linkages, bank loans, registration on government e-market portals, and similar e-commerce portals such as Amazon. The SHGs will also be helped with an MSME registration, a GST registration and an income tax registration so that they qualify for the 59-minute bank loan sanction scheme, an official told the national daily.