How does Self-Help-Group work in rural areas ? Explain.

(i) Self-help groups are organised in rural areas to create new ways of providing loans to the poor.

(ii) The idea is to organise rural poor, in particular women, into small Self-Help Groups (SHGs) and pool (collect) their savings.

(iii) A typical SHG has $\displaystyle 15$-$\displaystyle 20$ members, usually belonging to one neighbourhood, who meet and save regularly.

(iv) Most of the important decisions regarding the savings and loan activities are taken by the group members.

(v) The SHGs help borrowers overcome the problem of lack of collateral.

(vi) They can get timely loans at easy interest for a variety of purposes and at a reasonable interest rate.

(vii) SHGs are the building blocks of organisation of the rural poor.

(viii) This help the women to become financially self- reliant.

(ix) Their regular meetings provide a platform to discuss and act on a variety of social issues such as health, nutrition, domestic violence, etc.