http://www.chaitanyaindia.

org/what-we-do/shg-and-federation-promotion
20/7/2014

SHG and Federation Promotion

Chirag is the name of our Community Based Microfinance program. Chaitanya is one of the
pioneers of community based micro-finance institutions in Maharashtra, India. It facilitated
the formation of Grameen Mahila Swayamsiddha Sangh, the first federation of self help
groups (SHGs) in Maharashtra. Initially SHGs came together to form an informal association
which was later registered as a charitable society. GMSS is located in the Khed block of
Pune district.
As of January 2013, Chaitanya has facilitated the setting up of fifteen federations in seven
districts of Maharashtra; eight federations in Pune district, one federation each in
Ahmednagar, Nashik, Satara, Sangali and Nandurbar districts, and two federations in Dhule
district. The federations in the Pune district are located in Khed, Maval, Ambegaon, Junnar,
Daund, Manchar, Shikrapur and Belhe blocks. In addition, it has initiated the formation of
SHG-Federation framework across nine blocks in six districts of Vidarbha (north eastern
Maharashtra) region infamous for its agrarian distress. Also capacity building as resource
organization is being provided to twenty-five CMRCs of MAVIM (Mahila Arthik Vikas Mandal).
Goal
To provide equitable and affordable financial services to women through the formation of
federations in all districts of Maharashtra
Objectives

To organize women into strong and sustainable self help groups, clusters and
federations as a forum for sharing, learning, planning and monitoring

To provide financial services such as savings, credit and insurance to the members

To promote federation linkage with institutions like the Small Industry Development
Bank of India and Friends for Women World Banking to meet the financial needs of
the members

To provide technical services to the federations like audit, MIS, financial

management, facilitating ratings and linkages with banks

Major Activities

Map scope of Chirag Unit

Coordinate and plan meetings between Districts, NGOs, Blocks and Villages

Implement awareness programme

New group formation

Cluster and federation programme

Conduct exposure visits

Coordinate with the Government and link their groups with the federations

Disburse loans and collect repayments

Coordinate training programme for financial management, coordination and default

management

Develop Monitoring Information System

Email: [email protected]
Head Office
Moti Chowk,Rajgurunagar,
Taluka Khed, District Pune 410505,
Mahasrashtra, India.
Telephone: 0091-2135-223176
Fax: 0091-2135-226580

Livelihood
Objectives and Activities

Enhance knowledge of livelihood practices and the skills required to manage available resources. Co
trainings tying up with technical partners; related to:
o Vermi-compost/Biodynamic
o Organic farming
o Animal husbandry
o Financial aid for credit needs

o Raised-bed agriculture
o Kitchen garden
o Horticulture
o Fodder enrichment-Azolla
o Systematic Rice Intensification (SRI)

Promote farmer groups around specific products and services identified via value chain analysis and
towards facilitating bigger share for them. This is achieved through both backward linkages like coll
procurement and forward market led interventions.

Create a cadre of community resource persons called Upjeevika Jankars to perform field extension s
marketing.

Promote entrepreneurship through skill trainings like tailoring, bag making and handicraft.

http://www.mavimindia.org/display_details.php?page=contactus&id=8

Nasik

[email protected]

NAS
Kalvan
HIK

Profile

SHG Based Schemes -

Plot No. 21, Jairam

Krushna Sankul,
95253- 2580
2581737
Gharpure Road, Ashok 608
Stambh, Dist. Nasik

GOPIKA CMRC Kalvan

Nashik

STRISHAKATI CMRC Nashik.

Malegaon

YASHASVI CMRC Malegao

Chandwad

AHILAYDEVI CMRC Chandwad

Niphad

GAUITAMI CMRC Tal. Niphad,

Kalvan

PRATIKSHA CMRC Abhona

Surgana

TEJASWINI CMRC Surgana,

Before \" Tejaswini Maharashtra Rural Women Empowerment Programme\".

Maharashtra Rural Credit Programme : (1994-2002)

The Maharashtra Rural Credit Programme (MRCP) is a poverty alleviation

programme supported by the International Fund for Agricultural
Development. In the first phase from 1994 onwards the programme was
implemented in 4 Districts of Chandrapur, Yeotmal, Nanded and Pune.
Thereafter from 1998 onwards 8 Districts namely Gadchiroli, Bhandrara,
Amravati, Dhule, Jalgaon, Thane, Beed and Nandurbar were added. In the
programme MAVIM was entrusted with the responsibility of
ensuring \"Women\'s Access to Credit\" as an important dimension. While
organizing rural women into SHGs MAVIM ensured that along with their
economic development, the political and social developmental needs of
the women were also addressed and a strong sense of \'self\' was
inculcated in the women. upto March 2007 , 4516 SHGs have been formed
and 64,423 w omen were organised together under this scheme. In this
project at the end of March 2007 the women had savings of Rs.10.51
crores and Rs. 39.56 crores of internal lending. The groups had accessed
bank loans to the tune of Rs. 25.82 crores. and 36549 women started
their own business.
Swarna Jayanti Gram Swarozgar Yojana (SGSY) :- (On going)

The SGSY is a Central Government Scheme implemented through the

District Rural Development Agency under the Rural Development
Department with the aim of alleviating poverty. The scheme was initiated
in 1999 but MAVIM has implemented the scheme in 2001. The scheme is
being implemented in 31 rural districts of Maharashtra. At the end of
March 2007, 10413 SHG groups were formed and 1,15,8284 women were
organised. By the end of March 2007 the women saved Rs.13.64 crores
and generated internal lending of Rs. 35.15 crores under this project. The
women also obtained Rs.35.15 crores of bank loans and 45405 women
started their own business.
Swayamsiddha Programe (IWEP) : (2002-2007)

The Indira Mahila Yojana was implemented by the Central Government

from 1994 and the Mahila Samruddhi Programme was merged with it and
a revised Swayamsiddha Programme was declared for implementation for
5 years from 2001 2002 onwards. To implement the programme MAVIM
was declared as the Programme Implementation Agency (PIA) vide G.R.
No. IMY-2001/40/Ka-10 dated 3.12.2001.The Women & Child Development
Department, Mantralaya, has declared MAVIM as the Apex Body for the
same. MAVIM implements the Swayamsiddha Programme in 19 districts
and 36 Blocks in Maharashtra. Out of 36 blocks, 21 blocks (old) of Indira
Mahila Yojana and 15 new blocks were selected. A target of forming 3,500
self-help groups by the end of 2006 was given in 19 districts where the
programme operated. At the end of March 2007, 3943 SHG groups were
formed and 50066 women were organised. The women saved Rs. 5.70
crores and generated internal lending of Rs. 10.31 crores. They obtained
bank loans of Rs. 12.65 crores. 17734 women started their own business.
Ramai Mahila Shakshamikaran (SCP): (On going

Under the Special Component Plan, the department of Social Justice of

the State Government allotted the scheme of formation of 20,250 self-help
groups of Scheduled Castes i.e. 3,03,750 women throughout Maharashtra
to cover 5920 villages within 4 years. Through this programme, trainings
were arranged on gender equality, gender sensitization, women\'s
empowerment, social awareness, functional literacy, entrepreneurship and
other related capacity-building aspects. MAVIM has been appointed as an
implementing agency of the scheme and Rs.20.25 crores was sanctioned
for the project as per GR No. MAVIM 2001/4/ KA/10 WCD Dept., dated
15.2.2003. The scheme is implemented in 33 districts directly by MAVIM
Sahayogines and through NGOs appointed by MAVIM. At the end of March
2007, 20950 SHG groups were formed and 2,53,092 women were
organised. Rs. 22.10 crores were saved by the women and they generated
Rs. 34.33 crores of internal lending. They obtained bank loans of Rs.
16.89 crores. Under this project 56190 women started their own business.
NABARD ADD-ON PROJECT:- (2003-2005)

Under this project, MAVIM was to form 1000 SHGs in 10 districts and
15,000 women were to be organized. MAVIM was to be given a promotion
grant of Rs. 1,880/- per SHG amounting to a total of Rs.1,88,000/- by
NABARD. The period of this project is of 2 years during which it is

expected that the emphasis will be primarily on establishing SHGs and

making credit available to them. As suggested by NABARD the 10
districts selected are Parbhani, Jalna, Washim Latur, Beed, Hingoli,
Nanded, Aurangabad Gondia and Kolhapur where the scheme is
implemented. At the end of March 2007, 1773 SHG groups were formed
and 21263 women were organised. Rs. 2.85 crores were saved by the SHG
members and Rs. 5.39 crores were given as internal loans to members of
the group. The women obtained loans of Rs.2.43 crores from banks.
Under this project 4141 women started their own business.
Rashtriya Sam Vikas Yojana (RSY) :- (2003-2005)

The Rashtriya Sam Vikas Yojana of the Planning Commission is to be

implemented in the districts Gadchiroli, Bhandara, Nandurbar, Gondia,
Dhule and Chandrapur. MAVIM has been entrusted the task of setting up
1000 SHGs in 3 years (2003-2005) in each district. Components such as
vocational training, revolving fund MIS have been included in this
programme. It is also proposed that \"MAVIM GHAR\" should be build from
this fund. At the end of March 2007, 2213 SHG groups were formed and
27159 women were organised in six districts. Rs. 1.99 crores were saved
by SHGs and Rs. 3.29 crores were given as internal lending. Under this
project, 6479 women started their own business.
Krushi Saptak Yojana:- (2003-2005)

The Krushi Saptak Yojana of the Agricultural Department is implemented

by MAVIM in 4 districts i.e. Washim, Nanded Parbhani and Sangli. Under
this project 25 SHGs are to be formed in each district and 250 women will
be organised. The training imparted is on Agricultural skills, Animal
husbandry, Dairy Development etc. The women trained in this field are to
start activities related to agriculture which will help them to earn their
own income. Qualified sahayoginis have been appointed by MAVIM in
order to train the SHG women in agriculture related self employment
activities. This scheme started in the year 2004-05. At the end of March
2007, 501 SHG groups were formed & 9441 women were organized. Rs.
49 Lacs were saved and Rs. 1.02 crores were given as internal lending and
Rs. 44. Lacs bank loan obtained by women. Under this project, 2628
women started their own business.
Tribal Development Project (TSP):- (On going)

The Tribal Department sanctioned a Project to MAVIM to develop SHGs to

be implemented in 8 districts i.e Nasik, Nandurbar, Thane, Chandrapur,
Gadchiroli, Gondia, Amrawati and Yeotmal for the empowerment of Tribal
Women. In this project 4600 SHGs are to be formed within 3 years. The
village survey and selection has been started in 8 rural districts by March
2007. 2832 SHGs were formed and 33663 women were organised. Rs.
41.58 crores were saved by women and Rs. 2.01 crores was the internal
lending and Rs. 1.58 crores Bank Loan obtained by women.

Ongoing Programmes :
A. Tejaswini Maharashtra Rural Women Empowerment
Programme :

The problems due to upscaling of MAVIMs programme began to surface in

2004 as a large number of groups were promoted by MAVIM under the
Special Component Plan which envisaged the creation of 20,250 Groups
of Scheduled Caste women and the Tribal Sub Plan which had the target of
setting up 4,600 SHGs of tribal women. It became difficult to retain
programme quality and manage the data pertaining to the large number
of SHGs with only four field level officers in every district. The expansion
in the number of village level SHG animators (Sahayoginis) also created
the problem of ineffective supervision of these staff. MAVIM hence
requested the state government to sanction a new project for setting up
second tier peoples institutions to give more effective services to SHGs.
The state government then approached IFAD with a proposal for a
programme aimed at providing stability and sustainability to the SHG
movement in the state. Thus, in 2007 the state government sanctioned a
new programme for MAVIM supported by IFAD known as the Tejaswini
Maharashtra Rural Women Empowerment Programme.
Area of operation of Tejaswini:

The Tejaswini programme will be implemented in all the 33 rural districts

of the State and over 13,000 villages where MAVIM presently operates,
supporting over 65,000 SHGs.

Targeting the Poor:

The target group for Tejaswini will be poor rural women especially from
the Scheduled Castes and Scheduled Tribes, woman headed households,
widows, deserted women, divorcees, landless laborers, AIDS affected
women etc.
Thrust Areas:
The Tejaswini Programme will focus on the following thrust areas:
1 : Grass Roots Institution building
2 : Micro Finance Services
3 : Livelihood & Micro Enterprise development
4: Women Empowerment
Strategy for Tejaswini :
1. Grassroots Institution Building - Building Community
Managed Resource Centres :
It is observed that SHGs require two levels of support in order to emerge
as sustainable grass root institutions. The first level of support required is
for the proper mobilization of SHGs with regular and appropriate books of
accounts, an efficient MIS system and assistance to members to pursue a
socio -economic development agenda. The second level of support is in
the form of apex organisations that provide services related to capacity
building training to SHG members, SHG quality checks, bank linkages and
other required services. These second tier organisations need to be
owned and managed by the SHGs themselves as primary organisations.
Under the Tejaswini Programme, MAVIM has thus adopted the strategy of
building second tier peoples institutions called Community Managed
Resource Centers.
Structure of the CMRC:
The Community Managed Resource Centre (CMRC) is a federation of
around 150-200 SHGs formed in a cluster of around twenty villages,
within the radius of 20 to 25 k.m. All SHGs in the cluster, regardless of
the agency that promoted them, will be eligible to become members and
avail of the services of the CMRC. All SHGs will strive by means of training,
regulation, adherence to SHG rules and implementation of
entrepreneurial and socio-economic agenda to become A Grade SHGs.
The CMRC will be a registered organization and will work on a no profit no

loss basis. It will not necessarily be at block level but can be established
at any centrally situated village.
Governance in CMRCs :
The CMRC will be governed by a Board represented by one SHG
representative from each village elected by the SHG village level
committee, adopting the principle of rotational leadership. A CMRC
covering twenty villages, will have a Board constituted with twenty
members. The Chairperson, Vice Chairperson, Treasurer and other office
Bearers will be appointed by the Board members by election from
amongst themselves. The CMRC will operate by means of sub committees
on various issues such as Training, Audit of SHG Accounts, Health
Services, Sanitation and Water Supply, Drudgery Reduction initiatives for
women, Gender and Panchayati Raj etc It will have a strong professional
managerial support seconded by MAVIM in the shape of a CMRC Manager
and an Accountant as well as field workers (Sahayoginies). Each
Sahayogini will have around five to seven villages and provide support to
around forty SHGs. The CMRC Manager will be the Member Secretary of
the institution, whereas MAVIMs District Coordinating Officer, will be an
advisor to the CMRC.

Role of CMRC :
The CMRC will function with a comprehensive and holistic agenda for area
development. The overall role of the CMRC will be to provide the basic
primary services to SHGs, that is - capacity building training to members,
bank linkages, gradation, audit of SHGs. The CMRC will also provide
specialized services to SHGs such as assessing the livelihood needs of
SHGs, tapping the required resources through convergence with various
government schemes and services and enabling the SHGs to access them
and take up community development programmes.
Fees and Service charges of the CMRC :
The services of the CMRCs will be paid for by the SHGs in the shape of
monthly charges. There will be a standard list of services included in the
general monthly service charge, as well as charges for special services
and rates to be charged for non members.
MAVIM will be supporting CMRCs for the first few years of the project
period on a reducing scale. Thus the SHGs will make a contribution to the
running of the CMRC right from the very beginning. CMRCs should strive to
become self reliant from the fourth year of their establishment

2. Micro Finance Services :

Expanding women\'s economic opportunities and increasing the income
they control, results in their increased status within the family, greater
economy efficiency, improved child health and nutrition, and reduced
poverty. Facilitating women\'s access to credit through micro-finance
activities based on self-help groups has proven successful in generating
additional income, jobs and small enterprise.
The programme will improve the access of need-based financial services
to poor women by creating more choices, building the credibility of the
poor women and creating history for them through self help groups and by
sensitising the formal financial institutions to the needs of the poor.
3. Women Empowerment and Social Equity :

The Tejaswini Rural Women\'s Empowerment Programmes has

emphasized on poor/ultra poor women\'s social, political and economic
empowerment. And similarly concentration is given on women\'s
individual and collective progress through SHGs. As this project has
adopted holistic approach, it facilitates women empowerment through
changing her views about herself as well as transforming attitudes of
other social institutions that have shown their opposition and created
barriers for women development. It is important to develop the inner
strength, control over resources and participation in decision making of
women. However, the focus of this programme is not only on women but
it also includes men, social institutions and other stakeholders to creat an
enabling environment for the process of women\'s empowerment.
The programme aims to change the attitude and perception of the men
which shall increase their responsibilities towards the domestic work, child
caring, farming and business activities.

Women Empowerment and Social Equity component has been divided 3

sections
1. Gender Integration
2. Creating Enabling Environments

3. Enhancing women\'s capacity

4. Livelihood And Micro Enterprise Development :
Tejaswini project places a greater emphasis on the development
of livelihoods with a belief that , improved livelihoods are needed
if poor are really to get out of poverty. The project therefore has
a strong livelihood support componant that aims to support the
establishment of new enterprises and expension of existing
enterprises. These will include individual household enterprises
as well as group and cluster businesses.
Agriculture is now the major source of livelihood. Livelihood
support therefore emphasizes more on agricultural activities
(Crops, horticulture, livestock,fish etc.) but nonfarm enterprises
are also to be coverd according to the potential of the area and
demand of group members. The programme also supports the
development of market linkages and marketing through the BDS
sub component. The project has settingup 6 BDS Centers in
different regions, initially as outsourced entities to be there for
strengthening livelihood component by inword flow of market
information and business development support. 6 BDS centers at
regional level have been setup at Bhandara, Washim, Pune,Latur,
Ratnagiri and Nashik to provide business development services to
SHGs. MAVIM has appointed required staff like BDS managers,
Business promoters, BDS Assistants and peons.

B.

ACC Ltd. assisted Women Empowerment

Programme\"

ACC limited is a renowned company in the cement manufacturing

business. As a part of its Corporate Social Responsibility Policy, ACC is
keen on undertaking various development projects in selected villages
near its Cement manufacturing units in various parts of India. Hence ACC
ltd assisted Women Empowerment Programme has been initiated and
MAVIM has made a partnership agreement with ACC Ltd. It is eight years
project and will implement in Chandrapur and Yeotmal districts. It will
implement in 30 villages around ACC area. All the poor families of the
villages will be cover in the programme. The identification of the poor will
be done by MAVIMs 14 point survey form.
The programme will focus on four major components i.e.
1.

a : Grass root Institution Building

2.

b : Women Empowerment & Social Equity

3.

c : Micro Finance Services

4.

d : Livelihood & Micro Enterprise Development

The programme will focus Formation of new SHGs and nurting the existing
SHGs of the villages. Major focus will be given on institution building of
women by providing capacity building of SHG members and leadership
development. Also women will be addressed on sensitive topics like
gender integration & gender sensitization , drudgery reduction of women
providing trainings. Social awareness camps health camps etc. Specific
activities will be concentrated in order to give an opportunity to women to
live a qualitative life. Focus on Enterpreneurship Awareness and
development to enhance & ungrade the skills & providing marketing ties
up. So that impact can be observed.
Under the Tejaswini Programme, MAVIM has thus adopted the strategy of
building second tier peoples institutions called Community Managed
Resource Centers. In this programme also Community Managed
Resource Centrewill be developed at block level. The CMRC will be a
registered organization and will work on a no profit no loss basis. It will not
necessarily be at block level but can be established at any centrally
situated village.
The CMRC will function with a comprehensive and holistic agenda for area
development. The overall role of the CMRC will be to provide the basic
primary services to SHGs, that is - capacity building training to members,
bank linkages, gradation, audit of SHGs. The CMRC will also provide
specialized services to SHGs such as assessing the livelihood needs of
SHGs, tapping the required resources through convergence with various
government schemes and services and enabling the SHGs to access them
and take up community development programmes. So that CMRC will be
self sustainable.

C . UNFPA Assisted Capacity Building For Increasing Demand

For Reproductive Health Services\" :
MAVIM is the State Womens Development Corporation of Maharashtra
and is working in across Maharashtra. MAVIM has covered 13000 villages
and covering a population of seven lakhs women of Self Help Groups.
MAVIM has its offices in every district comprising of four professional
officers, support staff and Sahayoginies. Each Sahayoginies look after 4050 SHGs covering around 20 villages .
The Sahayogini is the backbone of the entire SHG movement in the state.
MAVIM thus gives a lot of importance to the training and capacity building
of Sahayoginies on various development issues, so that they can in

addition to the economic aspect orient and build capacities of SHG

members on development issues. Hence major focus of the project will be
on
Capacity building of a group of master trainers ( Sahayogini and AMO)
1.

Orientation and capacity building of Sahayoginies.

2.

Capacity building of SHG members to seek quality health services.

Supported by United Nations Fund For Population Activities ( UNFPA ) ,

MAVIM intends to organize training of the sahayoginis for improving their
knowledge, attitudes and health seeking behavior concerning their
reproductive health so that they could help the members of SHGs in these
aspects. If these women are addressed and their knowledge , attitude
and health seeking behavior is increased they could be educating the
other women in the community. It is three years programme and will
implement in across Maharashtra.

D. Minority Women Empowerment Programme :Mahila Arthik Vikas Mahamandal is the State Women Development
Corporation , declared as a Nodal agency to implement women
development programmes in Maharashtra. With the successful
experience of implementing IFAD assisted MRCP programme , MAVIM has
taken up various women empowerment programme through SHG building
i.e. SGSY , Swayamsiddha , TSP , SCP NABARD ADD ON, Rashtriya Sam
Vikas Yojana which are supported by Central Government as well as State
Government.
MAVIM is working in the field of women empowerment since last fifteen
years. We have succeeded in bringing about the poor women in the main
stream of the society/ community. The task of developing women have
been successfully implemented through the effective strategy of forming
Self Help Groups. MAVIM have catered towards the backward class
population of Schedule Caste and Schedule Tribe community. Looking at
the current strata of the Muslim community there is lack of awareness and
facility in the field of health, hygiene and education. The women from this
community is much more behind the level of empowerment . As this
community is still in the era of Bhurka system. Women dont have the
right to expression. Therefore it is necessary to cater towards this
population and give them proper handholding support, organize them
together, train and motivate them to become independent and self
sufficient. MAVIM had submitted a proposal to Maharashtra State
Minorities Commission, Mumbai and it is sanctioned by them.

Thus to achieve above objective MAVIM has taken a project called

Minorities Women Empowerment Programme for the selected pockets of
Mumbai and eight districts of Maharashtra i.e. Malegaon, Karanja,
Bhiwandi, Nanded , Parbhani , Aurangabad etc.
MAVIM will implement this programme through NGO. One NGO will be
formed 200 SHGs in muslim pockets and this women will be provided with
basic trainings input , functional literacy training programe, Gender
sensitization awareness, Enterpreneurship awareness programme,
Enterpreneurship Development Programme, village level committee, and
CMRC concept etc. This activities lead to the empowerment of village
women and they will become self sufficient
The programme will focus on four major components i.e.
1.

Grass root Institution Building

2.

Women Empowerment & Social Equity

3.

Micro Finance Services

4.

Livelihood & Micro Enterprise Development

5.

E.

4% Low interest rate scheme :

Providing subsidized loan to women SHGs in the State:SHG movement has spread to a wider scale in the state of Mahrashtra
from last decade. However the linkage of SHGs with banks, amount of
bank loan by banks and heavy interest charges on SHG loan are the key
challenges before the movement. Taking this into account, Government
of Maharashtra has launched a scheme of \" Providing subsidized loan
to women SHGs in the State\"( vide G.R. Number MAVIM 2008/PK
130/Desk 10 dt.8.10.08).MAVIM has been declared as a Nodal Agency to
implement this scheme in the state.
The scheme is applicable to the non subsidized women SHGs formed by
MAVIM and NABARD (under the schemes sponsored by NABRAD). The
scheme is to promote the timely repayment habits amongst the SHGs
Hence it do not provide upfront subsidy to SHGs. The SHGs once linked to
bank under this scheme needs to pay the bank loan (principal +interest)
every month and the interest subsidy up to 7% is debited in the SHG
accounts at the interval of every six months. As per the design of the
scheme the SHGs need to pay the interest @ minimum 4% at least. Thus
the interest subsidy benefit is ultimately linked to the repayment
performance by the SHGs which is a key factor.

MAVIM has taken up steps to sensitize bankers over the issues such as
increasing the loan volume per SHG and as a result of this, State Bank Of
India has increased the first dose of SHG linkage up to Rs 50000, second
up to Rs.1.00 lakhs and third up to RS.5.00 lakhs which is a positive
change at policy level. (Vide circular no RBU/MF-27/NGO MEETS/304 dt
19.03.2010)

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Page 1

NationalBankforAgriculture
andRuralDevelopment
AHANDBOOKONFORMINGSELF
HELPGROUPS
(SHGs)
Page 2

1
Thishandbookisspeciallypreparedfora
reasonablyeducatedandhelpfullocal
person,whocanhelpthepoortoform
SelfHelpGroups(SHGs).
Thisbookhelpstounderstandthesubjectina
simpleway.

Copiesofrelevantinstructionsfromthe
ReserveBankofIndia(RBI)andNABARDare
givenintheannexuretothisbook.
Somesimpleformatsoftheminimum
requirementofaccountregisters,membership
registers,minutesbook,etc.,whichare
generallyusedbySHGsaregiven,
forguidance.
Theformatsofthedocumentstobesubmitted
bytheSHGs,whileavailingloansfrombanks
arealsogivenasannexuretothishandbook.

ABOUTTHIS
HANDBOOK
Page 3

Contents
PageNos.
ABOUTTHISHANDBOOK

1
HelpingtoFormSHGs
3
WhatisSelfHelp?
4

HowdoWeStart?
5
HowareGroupsFormed?
7
HowareGroupMeetingsOrganised?
8
HowdoSHGstakeshape?
9
HowdoSHGsfunction?
11
CharacteristicsandFunctionsofSHGs
12
LinkingofSHGstoBank
15
Step1OpeningofS/BAccountfortheSHG
16
Step2ConductofinternallendingbytheSHG
17
Step3AssessmentofSHGs
17
Step4SanctionofCreditFacilitytotheSHG
19

SpreadingtheMessageofSHGs
22
ANNEXURES

23
I.SpecimenpagesofINTERSEAGREEMENTTOBEEXECUTEDBYTHEMEMBERSOF
THESELFHELPGROUP

23
II.SpecimenofAPPLICATIONTOBESUBMITTEDBYSHGTOBANK

25
III.FormatofARTICLESOFAGREEMENTFORUSEBYBANKSWHILEFINANCINGSELFHELPGROUPS

26
IV.SpecimenofSavingA/c.RegistermaintainedbySELFHELPGROUP

28
V.SpecimenofLoanA/c.RegistermaintainedbySELFHELPGROUP

29
VI.SpecimenofCASHBOOK

30
VII.RBICircularonOPENINGOFSAVINGSBANKACCOUNTSINTHENAMEOFSELFHELPGROUP

31

RegionalOfficesofNABARD
32

Page 4

HelpingtoFormSHGs
WereadandhearaboutSelfHelpGroups(SHGs)often.
VerypoorpeopleformSHGs.
Theysaveverysmallamountsofmoney.
TheylendthesesmallamountstoeachotherintheSHG.
Theyalsotrytosolvemanyoftheirproblemstogether.
CanSHGsbeformedinourownvillage?
CanwehelpthepoorpeopletoformSHGs?

Whatdowedotohelpthem?

ThisbooklettellsyouinsimpletermshowtohelpthepoortoformSelfHelp
Groups.

Page 5

WhatisSelfHelp?
Fromourchildhooddays,wehearsayingslike
Selfhelpisthebesthelp
Unityisstrength
Unitedwestand,dividedwefall

Wehaveheardthestoryofthebirdscaughtina
net.
Theycouldnotescapeonebyone.
Butwhentheyflewtogetherinagroup,theyescaped.
Weknowthatonestickiseasytobreak.
Butitisdifficulttobreakabundle(group)ofsticks.
TheSHGsshowushowunityisstrength.
Theyshowushowselfhelpcouldbethebesthelp.
Itisusefulifwecanencourageandhelppoorpeopletoform
SHGs.

Page 6

HowdoWeStart?
Evenathousandmilejourneystartswithasinglestepforward.
ThefirststepforforminganSHGisalsosimple
Visittheverypoorfamiliesinyourvillage
Talktothem
Ifthepeopledonotknowyou,firsttalktothemaboutyourself.

Itisimportanttobeknowntothepeopleandtowin
theirtrust.
Talktotheeldersinthevillage,explainyourplantothemand

requestfortheirsupport
Youwillneedtokeepasmallnotebook.Alistofitemsisgiveninpage7.
Pleasecopythislistonyournotebook.Useitforeveryfamilyyouvisit.

Page 7

6
Wheneveryouvisitapoorfamily,
Speaktothewomenfolk
Askwhatisthemostimportantissueforthefamily
Writealldetailsasperyourlistcopiedfrompage7.

Everytimeyouvisitsuchfamilies,pleasetellthem
thatyouarenotdistributingorpromisingany

subsidymoneyunderanyscheme.Thisisvery
importanttoavoidmisunderstandingatlaterstages.
ThisiscalledPreliminarySurvey.Thishelpsyoutounderstandtheneeds
of
eachindividualfamily.
Youwillneedtovisitthesamefamiliesagain.Whenyouseethemfor
thesecondtime,youwillbeabletotelleachfamilyhowyouhave
seenandspokentootherfamilies,whoalsohaveverysimilarproblems
likethem.
Byvisitingthefamilies,youwillbeabletoknowwhichofthosefamilies
could
cometogetherinSelfHelpGroups.Youwillalsounderstandwhattheir
commonrequirementsandproblemsare.

Page 8

HowareGroupsFormed?
Whenyouspeaktofamiliesinalocality,youwillfindthatsomekindof
mutuallikingalreadyexistsbetweenmanyofthem.Someknownreasonsfor
mutualaffinitiesare:
Similarexperienceofpoverty
Similarlivingconditions
Samekindoflivelihood

Samecommunityorcaste
Sameplaceoforigin

Itwillbeeasyatthisstagetofindoutwhichfamiliesarelikelytoget
together
better.

Whattypeoffamiliesdowevisit,
forformingSHGs?
Askthesequestionsabouteachfamily:
1.Doesthefamilyhaveonlyoneearningmember?
2.Doesthefamilybringdrinkingwaterfromfarawayplace?
3.Arethewomencompelledtogofarintheopenintheabsence
oflatrine?
4.Arethereoldilliteratemembersinthefamily?
5.Aretherepermanentlyillmembersinthefamily?
6.Aretherechildreninthefamilywhodonotgotoschool?
7.Isthereadrugaddictoradrunkardinthefamily?
8.Istheirhousemadeofkucchamaterial?
9.Dotheyregularlyborrowfromthemoneylender?
10.Dotheyeatlessthantwomealsaday?
11.Dotheybelongtoscheduledcastesorscheduledtribes?
IFYESISTHEANSWERFORTHREEORFOUROFTHESE
YESISTHEANSWERFORTHREEORFOUROFTHESE
QUESTIONS

QUESTIONS,YOUCANCONSIDERTHEF
OUCANCONSIDERTHEF
OUCANCONSIDERTHEFAMILYASPOOR
YASPOOR
YASPOOR.

Page 9

HowareGroupMeetingsOrganised?
BeforeSelfHelpGroupsareformed,holdameetingofthecommunity
leadersandeldersofthevillage.ExplaintothemyourplantoformSHGs.
Youwillgetsupportfromthem.Thisisveryimportant.
Thisiscalledcommunityparticipation.
Thiswillalsogiveacceptancetoyourworkinthevillage.

Thisistherighttimetotelleveryonethatthemeetingsarenotforgiving
anything,buttoenablethepoorfamiliestocometogetherandhelpeach
other.
ItwillbeveryusefulifyouexplainthebasicprinciplesofSelfHelpGroup
in
thismeeting.

Page 10

HowdoSHGstakeshape?
Aftermeetingtheeldersandcommunityleaders,youarenowreadytocall
SHGmembersforameeting.Youcangetonememberfromeachofthe
identifiedfamiliestocomeforameetingonaconvenientday.Thiscanbe
calledastartupmeeting.
Duringthemeeting,youwillgetalotofquestions.Youranswerswillhelp
themslowlyunderstandtheconceptfurther.
Pleaseallowsufficienttimeforthememberstounderstandthedifferent
aspectsofgroupformation.
Theprocessofforminggroupsnormallytakesfivetosixmonths.
Oncethegroupisformed,ittakesonetooneandahalfyearstosettle

toastablepattern.

Membership
Duringtheinitialmeetings,followingthingsmayhappen:
Somemembersleave
Somenewmemberscomein
Themembersslowlylearntodecidesubjectsformeetings
Theylearntoconductmeetings
Theyunderstandthevalueofrecordsanddocuments
Theywanttoremaintogetherandhelpeachother

Thesearenormalstages.Thiswillgiveyoutheconfidencethatyouare
movingintherightdirection.

Page 11

10

Leadership
Onememberofthegroupneedstotakethelead.
Howisthispersonidentified?
Thebestwayistoaskthefollowingquestionswithinthegroup:
QUESTIONS
ANSWERS
WhoshoulddecideeverythingfortheSHG?
Allmembersshoulddecide
WhobenefitsfromtheSHG?
Allmembersbenefit
Whoshoulddothework?
Allshouldsharethework
Howcantheworkbeshared?
Agreeononepersontotakeup
theworkbyrotation

Thisway,thememberswillunderstandthereasonforrotationofthe
responsibilities.Thiswillmakeiteasytochooseamembertotakeinitiative
forthefollowingmainactivities
Bookkeeping
Organisingmeetings

Page 12

11

HowdoSHGsfunction?
SimplerulesarerequiredforSHGstofunction.Thefollowing
aresomeimportantrules:
Commonagreementonwhentomeet
Decisionontimeandplaceofmeetings
Agreedpenaltiesfornonattendance
Agreementonamountofsaving
Givingsmallloanstoeachother
Takingloanfrombanks,repaymenthabits

Trainingofthemembersisanimportantneedforproperfunctioningof
SHGs.Theseareasfortrainingcoulddowelltothemembers:
Basicmathematics
Writingofbooks
Schedulingofmeetings
Socialaspectslikewomenempowerment
Basicsoflendingmoney,borrowing,repaying

MosteffectivemethodoftrainingofSHGmembersistotakethemtoagood
workingSHGandallowingfreeinteractionwithitsmembers.
LetusnowlookatanSHGlittleclosely,andunderstanditscharacteristics
and
functions.

Page 13

12

CharacteristicsandFunctionsofSHGs

Characteristics

TheidealsizeofanSHGis10to20members.

(Inabiggergroup,memberscannotactivelyparticipate.)
Thegroupneednotberegistered.
Fromonefamily,onlyonemember.

(MorefamiliescanjoinSHGsthisway.)
Thegroupconsistsofeitheronlymenorofonlywomen.

(Mixedgroupsaregenerallynotpreferred.)
Womensgroupsaregenerallyfoundtoperformbetter.
Membershavethesamesocialandfinancialbackground.

(Membersinteractmorefreelythisway.)
Thegroupshouldmeetregularly.

(Membersunderstandeachotherbetteriftheymeetweekly.)
Compulsoryattendance.

(Fullattendanceforlargerparticipation.)

Page 14

13

BookkeepingbytheSHG:

Simpleandclearbooksforalltransactionstobemaintained.
Ifnomemberisabletomaintainthebooks,someonetobe

engagedbythegroupforthepurpose.
Animatorcanalsohelp.
MinutesBook:

Theproceedingsofmeetings,therulesofthegroup,namesof
themembers,etc.arerecordedinthisbook.
SavingsandL

SavingsandLoanRegister:
oanRegister:
Showsthesavingsofmembersseparatelyandofthegroupasa
whole.
Detailsofindividualloans,repayments,interestcollected,balance,
etc.areenteredhere.
WeeklyRegister:

eeklyRegister:
Summaryofreceiptsandpaymentsonaweeklybasis.
Updatedeverymeeting.
MembersP

MembersPassbooks:
assbooks:
Individualmemberspassbooksencourageregularsavings.

Page 15

14

FunctionsofSHGs:

(a)SavingsandThrift:
SavingsandThrift:
Theamountmaybesmall,butsavingshavetobearegularand

continuoushabitwithallthemembers.
SavingsfirstCreditlatershouldbethemottoofeverygroup

member.
Groupmemberslearnhowtohandlelargeamountsofcash

throughsavings.Thisisusefulwhentheyusebankloans.
(b)Internallending:
Internallending:
Thesavingstobeusedasloansformembers.
Thepurpose,amount,rateofinterest,etc.,tobedecidedbythe

groupitself.
ProperaccountstobekeptbytheSHG.

(SpecimenformatsgivenasanAnnexureattheendofthisbook)
Openingsavingsbankaccountwithbank.
EnablingSHGmemberstoobtainloansfrombanks,and

repayingthesame.
(Detailsmaybeseeninthenextchapter)
(c)Discussingproblems:
Discussingproblems:
Everymeeting,thegroupwilldiscussandtrytofindsolutionsto

theproblemsfacedbythemembersofthegroup.

Page 16

15

LinkingofSHGstoBank

Openingofsavingsbankaccount

InternalLendingbytheSHG

AssessmentoftheSHG

ChecklistforassessmentofSHG

RepaymentofloansbytheSHG

epaymentofloansbytheSHG
SoonafteranSHGisformedandoneortwomeetingsheldwherethe
savingsarecollected,asavingsbankaccountcanbeopenedinthenameof
theSHG.
Thefollowingstepswillexplaintoyouhowthiscanbedone.

Page 17

16

Step1OpeningofS/BAccountfortheSHG
OpeningofS/BAccountfortheSHG
TheReserveBankofIndiahasissuedinstructionstoallcommercialbanks
andregionalruralbanks,permittingthemtoopenSBA/csofregisteredor

unregisteredSHGs.
SBA/cinthenameofSHGcouldbeopenedafterobtainingfromthegroup
thefollowingdocuments:
ResolutionfromtheSHG:

esolutionfromtheSHG:
TheSHGhastopassaresolutioninthegroupmeeting,signedbyall
members,indicatingtheirdecisiontoopenSBA/cwiththebank.
Thisresolutionshouldbefiledwiththebank.
AuthorisationfromtheSHG:

TheSHGshouldauthoriseatleastthreemembers,anytwoofwhom,
tojointlyoperateupontheiraccount.Theresolutionalongwiththe
filledinapplicationformdulyintroducedbythepromotermaybefiled
withthebankbranch.
CopyoftherulesandregulationsoftheSHG:

Thisisnotamust.Ifthegrouphasnotformulatedanysuchrulesor
regulations,loanscanbesanctionedwithoutthem.
Asavingsbankaccountpassbook
AsavingsbankaccountpassbookmaybeissuedtotheSHG.
ThisshouldbeinthenameoftheSHGandnotinthenameofany
individual/s.

Page 18

17

Step2ConductofinternallendingbytheSHG
ConductofinternallendingbytheSHG
Aftersavingforaminimumperiodof2to3months,thecommon

savingsfundshouldbeusedbytheSHGforlendingtoits
ownmembers.
Thepurpose,termsandconditionsforlendingtoitsmembers,

rateofinterestetc.,maybedecidedbythegroupthrough
discussionsduringitsmeeting.(RBIandNABARDhavepermitted
thememberstodecideontheseaspects.)Theinterestisusuallykept
as2or3rupeesperhundredrupeepermonth.Pleaseremember
thatinterestpermonthisbetterunderstoodinvillages,thanannual
interest.
Simpleandclearbooksofaccountofsavingsandlendingshouldbekept

bytheSHG.
(SpecimenformatsofbookstobekeptbytheSHGsareannexedto
thisbook)
Throughinternallendings,
themembersoftheSHGwill
learntoproperlymanage,
utiliseandrepaytheirSHGloans.
Thiswillbeofhelp,
whentheylaterborrowfromthebank.

Step3AssessmentofSHGs

AssessmentofSHGs
WeneedtoknowwhethertheSHGhasbeenfunctioningwell.
ThechecklistgivenbelowwillhelpustoassesseachSHGinasimple,

buteffectivemanner.

Page 19

18
CHECKLISTT
CHECKLISTTOASSESSTHEPERFORMANCEOFANSHG
OASSESSTHEPERFORMANCEOFANSHG
Sr.Factorstobechecked
Verygood
Good
Unsatisfactory
No.
1.GroupSize
15to20
10to15
lessthan10
2.Typeofmembers
Onlyverypoor
2or3notvery
manynotpoor
members
poormembers
members
3.Numberofmeetings

Fourmeetingsina
Twomeetingsina
Lessthantwo
month
month
meetingsinamonth
4.Timingsofmeetings
Nightorafter
Morningbetween
Othertimings
6p.m.
7and9a.m.
5.AttendanceofmembersMorethan90%
70to90%
Lessthan70%
6.ParticipationofmembersVeryhighlevel
Mediumlevelof
Lowlevelof
ofparticipation
participation
participation
7.Savingscollectionwithin
Fourtimes
Threetimes
Lessthanthree
thegroup
amonth
amonth
timesamonth

8.Amounttobesaved
Fixedamount
Varyingamounts

9.Interestoninternalloan
Dependingupon
24to36%
Morethan36%
thepurpose
10.UtilisationofSavings
Fullyusedfor
Partlyusedfor
Poorutilisation
amountbySHG
loaningtomembers
loaning
11.Loanrecoveries
Morethan90%
70to90%
Lessthan70%
12.Maintenanceofbooks
Allbooksare
Mostimportant
Irregularin
regularlymaintained
registers(minutes,maintainingand
andupdated
savings,loans,etc.)updatingbooks
areupdated

13.Accumulatedsavings
MorethanRs.5000/Rs.30005000/
LessthanRs.3000/
14.KnowledgeoftheRules
Knowntoall

Notknowntoall
oftheSHG
15.Educationlevel
Morethan20percent
Lessthan20percent
ofmemberscanread
knowtoreadand
andwrite
write
16.KnowledgeofGovt.
AllareawareofGovt.Mostofthe
Nooneknows
programs
programs
membersknow
aboutGovt.
programs

Important:
1.SHGswith12to16"verygoodfactors
12to16"verygoodfactors
12to16"verygoodfactorscangetloansimmediately
loansimmediately
loansimmediately.

2.SHGswith10to12"verygoodfactors
10to12"verygoodfactors
10to12"verygoodfactorsneed3to6monthstime
3to6monthstime
toimprove
toimprove,beforeloanisgiven.
3.SHGswithratingoflessthan10
lessthan10
lessthan10verygoodfactorswillnotbeconsidered
verygoodfactorswillnotbeconsidered
forloan.

Page 20

19

Step4SanctionofCreditFacilitytotheSHG
SanctionofCreditFacilitytotheSHG
Inwhosenameistheloanissued?

Theloanisalwayssanctionedandissuedinthenameofthegroup.
(Notinthenameoftheindividualmembers.)
Whatisthequantumofloan?Howisthequantumdecided?

TheamountofloantotheSHGcanbetothetuneof1to4timesofits
savings.
Whatconstitutesthesavingsofthegroup?
ThegroupsbalanceintheSBA/c
Amountheldascashwiththeauthorisedpersons

Amountinternallylentamongstthemembers
Amountreceivedasinterestontheloans
Anyothercontributionsreceivedbythegrouplikegrants,

donation,etc.
Whatarethepurposesforwhichtheloancanbegiventothe

SHG?
LoanmaybegrantedbytheSHGforvariouspurposestoitsmembers.
ThebankdoesnotdecidethepurposesforwhichtheSHGgives
loanstoitsmembers.Thepurposecanbeemergencyneeds
likeillnessinthefamily,marriage,etc.orbuyingofassetsforincome
generationacquisitionofassets.Thegroupwilldiscussanddecide
aboutthepurposeforwhichloansaretobegiventoitsindividual
membersbytheSHG.
Whomakestherepayment?

TheSHGmakestherepaymenttothebank.(Thegroupiscollectively
responsiblefortherepaymentoftheloan.)

Page 21

20
Whatisthecollateralsecurityforthebank?

RBI/NABARDrulesstipulatethatnocollateralsecurityshouldbetaken
fromSHGsbybanks.
CollateralsecurityisnotnecessaryfortheloanssanctionedtoSHGs

because:
ThemembersofSHGsknowthatthebankloanistheirownmoney

likesavings.
Theyareawarethattheyarejointlyresponsiblefortherepayment.
Therefore,theyexertmoralpressureontheborrowingmembersfor

repayment.
Becauseofthis,thebankgetsamuchbetterrepaymentfromthe

SHG.
CanthebankholdtheSBA/cbalanceoftheSHGasa

security?
No.ThiswillpreventtheSHGfromlendingfromitsinternalsavings.
Whatistherateofinteresttobechargedfortheloansgranted

toSHGbythebank?
TheReserveBankofIndiahasallowedthebanksfreedomtodecide

ontheinterestratestobechargedtotheSHGs.
WhatistherateofinteresttobechargedbytheSHGstoits

members?
Therateofinteresttobechargedbythegrouptoitsmembersshould
belefttothegroup.Thisisusually2or3rupeesperhundredrupees
ofloans.

Page 22

21

ListofdocumentsrequiredbybanksforlendingtoSHGs

(i)InterseAgreementtobeexecutedbyallthemembersoftheSelf
HelpGroup.(Thisisanagreementbythememberswiththebank,
authorisingaminimumofthreememberstooperatethegroups
accountwiththebank.)
(ii)ApplicationtobesubmittedbySHGtobankbranchwhileapplying
forloanassistance.(Thisincludesdetailsofthepurposesforwhich
theSHGgivesloantoitsmembers.)
(iii)ArticlesofAgreementforusebythebankwhilefinancingSHGs.
(Thiscontainsthedulystampedagreementbetweenthebankandthe
SHGwhereinboththepartiesagreetoabidebythetermsandcondition
setthereon.)
(Alltheaboveformatsaregivenasannexurestothisbook.)
Thegroupmembersarecollectivelyresponsiblefortherepaymentofloansto
thebank.Undernocircumstance,theSHGshouldallowanyofitsmembers
todefaulttothebank.

Page 23

22

SpreadingtheMessageofSHGs
HowcanyouspreadthemessageofSHGs?
Youcaninvolveeffectivelyinformation,nurturingandlinkingtheSHGs
toalocalbank.PleasegetintouchwithourregionalofficeinyourState,

whowillbehappytoprovideyouwithallinformationandsupportin
thisregard.TheaddressofourRegionalOfficesisgiveninpageNo.32.

Page 24

23
ANNEXUREI
[TOBESTAMPEDASAGENERALPOWEROFATTORNEY]
INTERSEAGREEMENTT
GREEMENTT
GREEMENTTOBEEXECUTED
OBEEXECUTED
BYTHEMEMBERSOFTHESELFHELPGROUP
YTHEMEMBERSOFTHESELFHELPGROUP
THISAGREEMENTmade
this
day
of
19
.
BETWEEN
1.Shri/Smt/Kum.
Son/Wife/Daughter
of
,aged
years.
residingat
;and
2.Shri/Smt/Kum.

Son/Wife/Daughter
of
,aged
years.
residingat
;and
3.Shri/Smt/Kum.
Son/Wife/Daughter
of
,aged
years.
residingat
;and
4.
5.
.
.
20.
whoaremembersofthe
group,hereinafterreferredtocollectivelyasTheSelfHelp
Group(SHG)Memberswhichexpressionshall,unlessrepugnanttothecontextormeaning,includeevery
membersofthesaidSHGandtheirrespectivelegalheirs,executorsandadministrators.
WHEREASallSHGmembersareresidentsof
Villagein
taluka
ofthe
Stateandareknowntoeachother.
WHEREAStheSHGmembersabovenamedhavejoinedvoluntarilytogetherandformedtheSHGwithintent
to
carryonsavingsandcreditandothereconomicactivitiesformutualbenefitsubjecttothetermsandconditions

hereinafterappearing:
NOWTHEREFORETHISAGREEMENTWITNESSETHTHAT:
1.EachmemberoftheSHGshallsaveasumofRs.
(Rupees
only)orsuchsumasmaybedecidedbytheGroup,onweeklyfortnightly/monthlybasiswhichshallbe
depositedwiththeauthorisedmemberofthegroup.
2.EachmembershallstriveforthesuccessoftheSHGandshallnotactinanymannerdetrimentaltothe
businessinterestsoftheSHG.
3.TheSHGmembersshallbejointlyandseverallyliableforallthedebtscontractedbytheSHG.
4.AllassetsandgoodsacquiredbytheSHGshallbeinthejointownershipofallthemembersoftheSHG
andshallordinarilybeintheconstructivecustodyofsuchmemberasmaybeauthorisedbytheGroup
andshallbekeptattheplaceofbusinessat
whichshallnotbechangedwithout
consentoftheSHGmembers.
5.TheSHGmembersherebydulyelectandappointShri/Smt/Kum.
as
,
Shri/Smt/Kum.
as
Shri/Smt/Kum.
as
[bywhatevernamedesignated]tolookafterandmanagethedaytodayaffairsoftheSHGsactivities
andalsoactintheirnameandontheirbehalfinallmattersrelatingthereto.Theauthorised
representatives,mayhowever,beremovedatanytimebymajorityvoteofthemembersandnew
representativeselected.

Page 25

24
6.EachoftheSHGmembersherebyagreestoabidebyandratifyallsuchact,deedsandthingsasthe

authorisedrepresentativesmaydointheinterestofthesaidactivities.
7.TheauthorisedrepresentativesshalltakedecisionsinthedaytodayworkingoftheSHGandeach
representativeshallactivelyinvolveherselforhimselfandcooperateinlookingafterthedaytoday
affairsoftheSHGactivitiesinparticulartoattendtothefollowingactivities.
EverymemberoftheSHGherebyauthorisestherepresentativestoapplyfortheloanonbehalfofthe
SHGandexecutenecessaryagreements/documentsonbehalfoftheSHGforthepurpose.The
authorisedrepresentativemaycollectloanamountsfromthebankonbehalfofSHG,depositthesamein
thesavingsaccountoftheSHGforonlendingtomembersinaccordancewiththedecisionoftheSHG
andalsodepositrecoveryofloaninstalmentfrommembersintheloanaccount/sofSHGwiththebank.
8.TheSHGmembersherebyspecificallyauthorisetherepresentatives:
(i)ToopenSavings,FixedDepositsandotheraccountsin(.......................)bankapprovedbytheSHG
andoperatethesameunderthejointsignatureofanytwoofthefollowingauthorised
representatives.
Shri/Smt/Kum.
Shri/Smt/Kum.
Shri/Smt/Kum.
(ii)Tokeeporcausetobekeptproperbooksofaccountsofthesavings,madebytheSHGMembers,
loansgrantedtothemandtherecoveriesmadefromthemandrendereveryyearthefullaccounts
totheSHGmembersfortheirapprovalandadoption;
(iii)ToreceiveallpaymentsduetotheSHGandissuerequisitereceiptsoracknowledgementsforand
onbehalfoftheSHG;
(iv)ToinstituteanddefendonbehalfoftheSHGmembersanylegalproceedingsandsafeguardthe
interestsofeachmemberofthesaidSHGandforthispurposeengageordisengageanylawyeror
advocateoragentandincurthenecessarylegalexpensesinconnectiontherewith.
9.IntheeventofdeathofanyofthemembersoftheSHG,his/herlegalheirsshallbeentitledforthe
benefitsandbeliablefortheobligationsofthedeceasedmemberunderthisagreement.
10.ItisagreedthatnonewpersonshallbeinductedasamemberoftheSHGwithoutconsentofallthe
existingmembers.
INWITNESSWHEREOFtheaforesaidmembersoftheSHGhavesettheirrespectivehandshereuntoatthe

place
andon
dayof
month
yearfirsthereinappearing.
NameofmemberSHG
Signature/s/Thumboftheimpression
(1)
(2)
(3)
(4)
.
.
(20)
WITNESSES:
(1)
(2)
(Note:TheSHGshallnotconsistmorethan20persons).

Page 26

25
ANNEXUREII
SpecimenofapplicationtobesubmittedbySHGtoBank
Branchwhileapplyingforloanassistance
NameoftheSelfHelpGroup:
Address:
Formed/Establishedon
Registered:Yes/No
Ifregistered:givenumberanddateand

furnishtruecopyoftheCertificateofRegistration.
NumberofmembersintheGroup:
NameofSHPI/NGO/VAassistingtheGroup:ifany,
To:
Date
TheBranchManager
Bank
Branch
DearSir,
APPLICATIONFORL
TIONFORL
TIONFORLOAN
WethedulyauthorisedrepresentativesoftheaboveSHGherebyapplyforaloanaggregating
Rs.
/(Rupees
only)foronlendingtoourmembers.
Thefinancialparticularsofthegroupason
aregivenintheenclosedsheet.
(date)
REPAYMENTSCHEDULE
YMENTSCHEDULE
2.Weagreetorepaytheloanamountaspertherepaymentschedulewhichmaybefixedbythebank.
3.AcopyoftheInterseAgreementexecutedbyallthemembersofthegroupauthorisingusinteraliato
borrowonbehalfoftheSHGisenclosed.
4.Weherebydeclarethattheparticularsgivenabovearetrueandcorrecttothebestofourknowledgeand
belief.
5.WeherebyauthorisetheBanktodisclosealloranyparticularsordetailsorinformationrelatingtoour
loanaccountswiththeBank,toanyotherfinancialinstitutionincludingNABARD,Governmentorany
agencyasmaybeconsiderednecessaryordesirablebytheBank.ItwillbeinorderfortheBankto

disqualifytheSHGfromreceivinganycreditfacilitiesfromtheBankandorrecalltheentireloanamount
oranypartthereofgrantedonthisapplication,ifanyoftheinformationpertainingtothegroup,
furnishedherewithisfoundincorrectand/orcontainingmisrepresentationoffacts.
Yoursfaithfully,
1.
2.
[Authorisedrepresentatives]
SELFHELPGROUP
FinancialParticularsason
Sr.No.Particulars
articulars
Amount(inRs.)
1.
SavingsfromMembers
2.
SeedMoneyfromSHPI[NGO/VA],ifany
3.
BorrowingsOutstanding:
(Pleasespecifysource)
4.
Loanoutstandingagainstmembers
5.
Amountindefault,ifany,againstmembers
6.
Recoverypercentage
7.
Cash/bankbalance

Page 27

26
ANNEXUREIII
FORMATOFARTICLESOFA
TOFARTICLESOFA
TOFARTICLESOFAGREEMENTFORUSE
GREEMENTFORUSE
BYBANKSWHILEFINANCINGSELF
YBANKSWHILEFINANCINGSELF
YBANKSWHILEFINANCINGSELFHELPGROUPS
HELPGROUPS
TheArticlesofAgreementmadeonthis
dayof
199
at
ByandBetweenM/s.
[nameofSHG]
anunregisteredassociationofpersons/individualshavingitsofficeat
representedbyitsauthorisedrepresentativeShri/Smt.
(Name)
andShri/Smt
(Designation)
(Name)
whoarefullyauthorisedbyallthemembersoftheSHG,(acopyofsuchAuthorisationisannexedheretoand
formspartofthisagreement),hereinafterreferredtoastheborrowerwhichexpressionshallunlessrepugnant
tothesubjectorcontextthereof,meanandincludemembersoftheunregisteredassociationforthetimebeing,
theirrespectivesuccessors,legalheirs,administratorsandassignsoftheonepartand
(nameofthebank)abodycorporateconstitutedunderthe
Act
have

itsHeadOfficeat
andtheBranches,interalia,oneat
hereinafter
calledtheBankwhichexpressionshallunlessrepugnanttothesubjectorcontextthereofmeanandincludeits
successorsandassigneesofthesecondpart.
Whereastheborrowerisanunregisteredassociationofpersonswhohaveinterseagreedtohelpeachotheras
selfhelpgroupwithaviewtodevelopingandamelioratingthesocioeconomicconditionsoftheirmembers.
Whereashavingformedtheassociationasaselfhelpgroup,theBorrowerasperapplicationdated
madebythesaid
Shri/Smt.
,
(Name)
(Designation)
andShri/Smt.
,
(Name)
(Designation)
dulyauthorisedtoborrowintermsofitsresolutiondated
[copyenclosed]requestedthe
Bankto*grantaloan/extendcreditfacilityof*Rs.
/uptothelimitof
Rs.
/(Rupees
only)foronlendingtoitsmembers.
AndwhereastheBankhasagreedtograntthe*loan/extendcreditfacilitytotheborroweroncertaintermsand
conditions.
AndwhereastheBankandtheborroweraredesirousofreducingtheagreedtermsintowriting.
Now,therefore,thisagreementwitnessethasfollows:
1.TheBankhasagreedtograntandtheborrowerhasagreedtoborrowbywayoftermloan/cashcredit

(clean)uptothelimitofRs.
/(Rupees
/only)andthebank
hasopened(SPECIFYTHEKINDOFLOANACCOUNT)A/CNo.
ofdate
/inthenameoftheborrowerinitsbookofaccounts.
2.IncasethefacilityavailediscashcredittheBorrowerswilloperatethecashcreditaccountsatisfactorily
andwithinthelimitandtheBorrowershallrepaytheoutstandingliabilityintheaccountinclusiveof
interestandotherchargesdebitedfromtimetotimeondemandwithoutdemur.
3.IncaseloanavailedisDemandLoan,withoutprejudicetotherightoftheBanktorecalltheloanon
demandtheBorrowerundertakestorepaytheloanwith(*Deletewhicheverisnotapplicable)interestand
otherwithintheperiodstipulatedintermsofsanction.

Page 28

27
4.Incasethecreditfacilityavailedofbytheborrowerisatermloanthesameshallberepayablein
instalmentsinthemannerspecifiedherebelowintherepaymentschedule.(tobespecified)Besidesthe
borrowerwillpayinterestattheratesthatmaybeprescribedforsuchlendingbyRBI/NABARDfromtime
totime.
5.Itisclearlyunderstoodbyandbetweenthepartiesheretothatintheeventoftheborrowersfailureto
utilisetheproceedsofthecreditfacilityforthepurposeforwhichthesamehasbeenmadeavailableby
thebanktotheborrower,theborrowershallrepayimmediatelyondemandwithoutdemurtogetherwith
interestwithoutprejudicetoBanksrighttoinitiateotherlegalaction.
6.Theborrowershallpayinterestontheloanstobecalculatedonthedailybalancesintheloanaccount
andbedebitedtheretoatquarterlyrestsorasthebankmaydecide.
7.Theborrowershouldutilisetheproceedsofthecreditfacilityforthepurposeoflendingtoismembersto
improvethesocioeconomicconditionsoftheirmembersandtheirfamilies.
8.Theborrowershallrepaythecreditfacilityavailedoftogetherwithinterestpayableaspertheinterest
ratesthatmaybefixedbyRBI/NABARDfromtimetotimeforsuchlendings.

9.Theborrowershallbeliabletorepaythefacilityondemandtogetherwiththeinterestandothercharges
payablebytheborrowertothebankinaccordancewiththerulesofthebank.
REPAYMENTSCHEDULE
YMENTSCHEDULE
Pleasespecify
Inwitnesswhereofthepartiesheretohaveaffixedtheirsignatureonthe
dateandthe
monthand
yearfirsthereinabovewritten.
FORSHG
FORBANK
(1)AUTHORISEDREPRESENTATIVE
(2)AUTHORISEDREPRESENTATIVE
MANAGER

Page 29

28
ANNEXUREIV
SELFHELPGROUP
SavingBankA/c
A/cNo.
Membersname
Address
Date
Particulars
Debit/withdrawalCredit/Deposit
Balance
Initials
Rs.

Ps.
Rs.
Ps.
Rs.
Ps.

Page 30

29
ANNEXUREV
SELFHELPGROUP
LoanA/c
Membersname
S.B.A/cNo.
LoanA/c.No.
Purposeofloan
RepaymentInstalmentMonthly/Quarterly/Halfyearly/AnnualRs.
Date
Particulars
Loan
InterestAmountrepaid
Balance
Signatureof
Amount
PrincipalInterestPrincipalInterestA/cholder/
Member

Page 31

30

ANNEXUREVI
SELFHELPGROUP
CashBook
Date
Particulars
Cheque
Debit
Credit
Balance
Total
Signature
No.
Cash
Bank

Page 32

31
ANNEXUREVII
RESERVEBANKOFINDIA
CENTRALOFFICE
DEPARTMENTOFBANKINGOPERA
ARTMENTOFBANKINGOPERA
ARTMENTOFBANKINGOPERATIONS
&DEVELOPMENTCENTREI
OPMENTCENTREI
WORLDTRADECENTRE
WORLDTRADECENTRE,CUFFEP
,CUFFEP

,CUFFEPARADE,
COLABA,MUMBAI400005
,MUMBAI400005
Ref.DBOD.No.BC.63/13:01:08/9293
January4,1993
Pausa14,1914(S)
AllScheduledCommercialBanks
(includingRegionalRuralBanks)
DearSir,
OpeningofSavingsBankAccountsinthenameofSelfHelpGroups
Pleaserefertopara3(i)ofourdirectiveDBOD.No.Dir.BC.151/C.34785dated27thDecember1985in
termsofwhichbankshavebeenprohibitedfromopeningofSavingsbankaccountsinthenameofcertain
bodies/organizations.TheissuerelatingtoopeningofsavingsbankaccountsbySelfHelpGroupsfinancedby
banksunderapilotprojectlaunchedbyNationalBankforAgricultureandRuralDevelopment(c.f.circulars
RPCD.No.PlanBC.13/PL09.22/9091dated24thJuly1991andNo.DPD104/DPD.FS.4631/92A/9192
dated26thFebruary1992issuedbyourRuralPlanningandCreditDepartmentandNationalBankfor
AgricultureandRuralDevelopmentrespectively)hasbeenexaminedandithasbeendecidedthatsuchSelf
HelpGroups,registeredorunregistered,maybeallowedtoopenSavingsBankAccountswithBanks.
Pleaseacknowledgereceipt.
Yoursfaithfully
(B.D.Nitsure)
.Nitsure)
DeputyChiefOfficer.

Page 33

32
1161,R.T.C.XRoad,
PostBoxNo.1863,Musheerabad
Hyderabad500020,
ANDHRAPRADESH

Tel.:(040)7613088
Email:[email protected]
VIPRoad,
BankTinali,PostBoxNo.133
Itanagar791111,
791111,
ARUNACHALPRADESH
CHALPRADESH
Tel.:(0360)212675
LaxmiBhawan,DrJCDasRoad,
Panbazar,PostBoxNo.81
Guwahati781001,ASSAM
Tel.:(0361)513102
Email:[email protected]
4thand5thfloor,MauryaLok
Complex,BlockB,
DakBunglowRoad,
PostBoxNo.178
Patna800001,BIHAR
atna800001,BIHAR
Tel.:(0612)210870
Email:[email protected]
1stfloor,PithaliaComplex,
Opp.TrunkExchange,
K.K.Road,FagadihChowk,
Raipur492009,
492009,
CHATTISGARH
Tel.:692455,525907,522558
Email:[email protected]
3rdFloor,NazariBhavan
302,MenezesBraganzaRoad,
Panaji403001,GO
anaji403001,GO

anaji403001,GOA
Tel.:(0832)420053
Email:[email protected]
NABARDTower,OppMuncipalGarden,
Usmanpura,
PostBoxNo.8,
Ahmedabad380013,
GUJARAT
Tel.:(079)7551618
Email:[email protected]
NABARDBhavan,BlockNo.32,
S.D.A.CommercialComplex
DevNagar,Kusumpti,
Shimla171009,
HIMACHALPRADESH
CHALPRADESH
Tel.:(0177)220775
Email:[email protected]
F1794ShastriNagarExtension,
PostBoxNo.2,
Jammu180004,
JAMMUANDKASHMIR
Tel.:(0191)434483
Email:[email protected]
GautamHouse,
KalibabuStreet,UpperBazaar
Ranchi834001,JHARKHAND
Tel.:(0651)208657
Email:[email protected]
113/1,JeevanPrakashBuilding
(Annexe),
JCRoad,PostBoxNo.29
Bangalore
Bangalore560002,KARNA

560002,KARNA
560002,KARNATAKA
Tel.:(080)2225241
Email:[email protected]
CorporationBuildingAnnexe,
VikasBhavanPostOffice
PostBoxNo.6505,Palayam,
Thiruvananthapuram695033,
KERALA
Tel.:(0471)323846
Email:[email protected]
E5,AreraColony,BittanMarket,
RaviShankarNagarPostOffice,
PostBoxNo.513,
Bhopal462016,
MADHYAPRADESH
APRADESH
Tel.:(0755)461644
Email:[email protected]
54,WellesleyRoad,
ShivajiNagarPostBoxNo.5,
Pune411005,MAHARASHTRA
411005,MAHARASHTRA
Tel.:(020)5511083
Email:[email protected]
89/686Lalambung,RIMSRoad,
LamphelpatPostOffice,
Imphal795004,MANIPUR
Tel.:(0385)312191
Email:[email protected]
DipuCottage,UpperLachumiere,
Shillong793001,MEGHALA
793001,MEGHALA
793001,MEGHALAYA

Tel.:(0364)227463
Email:[email protected]
RamhlunRoad(North),Bawngkawn,
Aizawl796012,MIZORAM
Tel.:(0389)340815
Email:[email protected]
NagalandStateCoop.BankBuilding,
OppositeFireStation,
Dimapur797112,NA
797112,NA
797112,NAGALAND
Tel.:(03862)27040
Email:[email protected]
3rdFloor,ExpressBuilding(Annexe),
10BahadurShahaZafarMarg,
PostBoxNo.12
NEWDELHI110002
Tel.:(011)3319669
Email:[email protected]
Ankur,2/1Nayapalli,
CivicCentre,PostBoxNo.179,
Bhubaneshwar
Bhubaneshwar751015,ORISSA
751015,ORISSA
Tel.:(0674)553884
Email:[email protected]
PlotNo.3,Sector34A,
PostBagNo.7,
Chandigarh160022,
PUNJAB&HAR
PUNJAB&HARYANA
Tel.:(0172)668174
Email:[email protected]
3,NehruPlace,

TonkRoad,PostBoxNo.104,
Jaipur302015,RAJASTHAN
302015,RAJASTHAN
Tel.:(0141)743215
Email:[email protected]
OmNiwas,ChurchRoad,
P.B.No.46,
Gangtok737101,SIKKIM
737101,SIKKIM
Tel.:(03592)23015
Email:[email protected]
105/106MahatmaGandhiRoad,
PostBoxNo.6074,Nungambakkam,
Chennai600034,T
Chennai600034,TAMILNADU
AMILNADU
Tel.:(044)8273792
Email:[email protected]
PalaceCompound(East),
UzibariRoad,PostBagNo.9,
Agartala799001,TRIPURA
Tel.:(0381)224125
Email:[email protected]
HotelSunriseBuilding,
2ndFloor,113/2,RajpurRoad,
Dehradun248001,UTT
Dehradun248001,UTTARANCHAL
Email:[email protected]
CommerceHouse,HabibullahEstate,
11,M.G.Marg,PostBoxNo.364,
Hazaratganj,Lucknow226001
UTTARPRADESH
ARPRADESH
Tel.:(0522)222055

Email:[email protected]
Abhilasha,2ndFloor,
6RoydStreet,PostBoxNo.9083,
Kolkatta700016,
olkatta700016,
WESTBENGAL
Tel.:(033)2294672
Email:[email protected]
UnionTerritories
erritories
KannadaSanghBuilding,
GroundFloor,18TagoreRoad,
HeadPostOffice,
PortBlair744101,
ANDAMAN&NICOBARISLANDS
AMAN&NICOBARISLANDS
Email:[email protected]

RegionalOfficesofNABARD
egionalOfficesofNABARD

Page 34
microCreditInnovationsDepartment
NationalBankforAgricultureandRuralDevelopment
EWing,BandraKurlaComplex,Bandra(E),Mumbai400051INDIA
Tel:(91)(22)26530084Fax:(91)(22)26528141
Website:www.nabard.org.Email:[email protected]
vakils