good

1. 32
CHAPTER II
REVIEW OF LITERATURE
The literature on Self Help Group and micro finance is relatively one of
the youngest. Its origin may be traced back to approximately thirty years but the
literature available is very large. This chapter reviews the various empirical studies
available on Self Help Groups and micro finance and its impact on the lives of rural
people. Though the literature available is fairly large, the review is limited to the core
issues to identify the major trends.
This chapter consists of two major sections. Section I outlines concepts
and terms, section II outlines review of literature covering Self Help Groups, their
merits and demerits, positive and negative impacts of micro finance, constraints /
problems faced by their clients, the role of Non-Governmental Organisations and
finally rural development.
2.1 Concepts and terms
2.1.1 Self Help Groups
Self Help Groups are voluntarily formed informal groups. An SHG
consists of 10-20 members. The members are encouraged to save on regular basis.
They use the pooled resources to meet the credit needs of the group members. The
groups are democratic in nature and collectively make decisions. Since the members
are neighbours and have common interest, the group is a homogenous one and
cohesiveness is one of the characteristic features of the group. Regular savings,
periodic meetings, compulsory attendance, proper repayment and systematic training
are the salient features of the SHG. Self Help Group is a path toward empowerment

2. 33
of rural people and the ultimate goal is the improvement of social and economic status
of rural women. Self Help Group is a participatory endeavour of people trying to
secure three types of power- social, political and psychological- that would empower
them and improve their lives. 1
Evidences from various developing countries throughout the world have
shown that the poor can be helped by organizing themselves into Self Help Groups.
Financial service is only a small part of the success story and the more fundamental
have been voice, identity and empowerment. Self Help Groups form the basic
constituent unit of micro finance movement in India.2
The characteristic features of Self Help Groups are:
1. Small in size (10 to 20 members in a group).
2. Identical background, common interest and affinity of members.
3. Close and intimate knowledge of member’s needs and problems.
4. Democratic functioning.
5. Simple documentation.
6. Collective decision making and peer pressure in repayment.
7. Regular meetings and savings.
8. Group access to external funds.
9. Focus on poor people especially women below poverty line.
Self Help Groups have the following advantages:
1. They help the poor to gain economic and social empowerment.
2. They reduce the transaction cost of lenders and borrowers.

3. 34
3. They encourage the poor to save. The poor become creditworthy and
bankable customers and are not seen as beneficiaries.
4. Women are trained in new skills and technologies and the wage
earning workers become micro entrepreneurs.
5. Increased asset creation and savings, higher employment and
improved social lives of members are the benefits to the members.
2.1.2 Micro-finance
Even though the terms micro credit and micro finance are interchangeably
used, the term micro finance connotes broader activity. Now, there is a shift from
micro credit (small loans) to micro finance, in which in addition to credit,
mobilization of savings, insurance, training and support services like assistance in
marketing of client’s products are provided which are otherwise known as ‘credit
plus’.
Micro finance programme has been introduced in many countries since it
has been considered as an important tool to combat poverty. Grameen Bank in
Bangladesh, Banco Sol in Bolivia and Bank Rayakat in Indonesia are some of the
examples and Grameen model has been replicated in many developing countries.
Micro finance is considered as a development tool to alleviate poverty in
Asian, African and South American countries. Micro finance gives quick and
tangible results to the poor people especially women. Micro finance is required by the
poor people to invest in income generating activities which will break their vicious
cycle of poverty.
A comprehensive definition given by Robinson is applicable to micro
finance in all countries in the world. “Micro finance refers to small scale financial
services for both credit and deposits – that are provided to people who farm or fish or

4. 35
herd; operate small or micro enterprises where goods are produced, recycled, repaired
or traded; provide services, work for wages or commissions; gain income from
renting out small amounts of land, vehicles, draft animals, or machinery and tools;
and to other individuals and local groups in developing countries, in both rural and
urban areas.”3
NABARD has defined micro finance as follows: “Micro finance is all
about provision of thrift, credit and other financial services and products of very small
amount to the poor in rural, semi urban and urban areas for enabling them to raise
their standard of living”.4
Sharma (2007) explains the principles of micro finance based on the
experiences gained during last three decades all over the world.
1. Small savings or thrift by poor is possible.
2. Poor people need small collateral free loans with regular frequency
instead of large loans at a time.
3. Repayment matches with the family cash flow instead of individual
cash flow.
4. Rate of interest is not crucial.
5. Timely, adequate and continued credit facility.
6. Relatively small repayment periods e.g. weekly, monthly, instead of
yearly instalments and half yearly instalments.
7. Credit plus is preferred to credit alone.
8. Women are better customers than men.
9. Group method of lending is more successful than individual lending.5

5. 36
UN declared the year 2005 as year of micro credit since the policy makers
of UN supported the view that micro finance is an instrument to fight against poverty.
According to Nobel Committee, micro finance can help the people to break poverty,
which in turn is seen as an important prerequisite to establish long last peace.6
It has been accepted that micro finance plays a vital role in reducing
poverty since it paves way for employment and empowerment which leads to
economic development. Poverty can be eradicated only by employment opportunities
and the employment seeker and worker should become a job provider. This is possible
through micro finance coupled with micro enterprises. But still micro finance plays a
modest role in India. At all India level, less than five per cent of rural poor households
have access to micro finance as compared to 65 per cent in Bangladesh. But
significant variation exists across Indian states and 75 per cent of micro finance flows
to the four southern states .7
Empowerment of women through Micro Finance benefits individual
women, their families and the community as a whole through collective action for
development. Pollution of water, deforestation, inadequate public health and
sanitation, ground water scarcity, falling ground water table, overexploitation of water
resources are some of the problems related to environment which may be addressed
through sustainable rural development which in turn is possible through SHG and
micro finance.
Group formation, provision of collateral free credit, participatory efforts
for income generating self employment, knowledge and awareness and skill
development have improved the socio economic conditions of rural poor. Self Help
Groups and micro finance are found to be successful in promoting empowerment of
women leading to development.

6. 37
2.1.3 Sustainable Rural development
In India, Community Development Programme (CDP) was launched in
1952 with the objective of bringing all round development of the rural areas. This was
followed by Natural Extension Service (NES) in 1953. These programmes were
followed by Intensive Agricultural District Programme (IADP) in 1960, Intensive
Agricultural Area Programme (IAAP) in 1964 and High Yielding Variety Programme
(HYVP) which brought Green Revolution in the country that resulted in record
agricultural productions and productivity.
Later, Government introduced many development programmes like Small
Farmers Development Agency (SFDA) and Marginal Farmers and Agricultural
Labourers Agency (MFAL) for the development of weaker sections. Subsequently
area development programmes like Drought Prone Area Programme (DPAP) were
introduced to develop the severely drought affecting districts. Hill Area Development
Programme (HADP) was introduced to develop hill areas. The objectives formulated
during 1979, for Rural Development are given below.8
1. Maximising production in agriculture and allied activities in the rural
areas including development of rural industries with emphasis on
village and cottage industries.
2. Generating maximum possible employment opportunities in rural
areas especially for the weaker sections of the community so as to
enable them to improve their standard of living.
3. Providing certain basic amenities like drinking water, electricity,
especially for productive purpose, link roads connecting villages to
market centres and facilities for health care and education.

7. 38
With these objectives, Integrated Rural Development Programme (IRDP)
was started to benefit the rural people below poverty line and it was one of the largest
rural development programmes in the world. It was felt that time had come to involve
the community for the benefit of whom projects are initiated or implemented. They
should participate in planning and execution so that projects initiated are self
sustaining. The community participation in development is essential as any
development project is not a one time activity. The sustainability of the project
requires that the project should involve people right from the beginning and
participation in all stages starting from planning to implementation and monitoring as
well as evaluation.
Sustainable Rural Development is the all round trajectory of development
of rural areas and development of weaker section of the people through productive
employment opportunities with diversified activities. These opportunities help people
to acquire skills so that they gain confidence and capacity to deal with problems and
make efforts to eliminate their poverty with awareness on health and environment
with a consideration of future generation. Sustainable Rural Development is not
merely construction of roads, installation of pumps and subsidies. It involves:
1. Livelihood and income generation
 Land based: Agriculture, horticulture, wasteland and watershed
development, forestry.
 Animal Husbandry: Dairy, Sheep/Goat, Poultry.
 Micro enterprises: IGA, trades by women, rural artisans.
These three are interrelated and interwoven for the sustainable rural
development.

8. 39
2. Physical and infrastructure development relates to drinking water,
roads, transport and other facilities concerned with rural socio-
economic life, area development, creation of infrastructure, job
opportunities, betterment of facilities, sustainability of resources,
environmental protection, sustainable utilization of resources,
alternate energy such as wind, solar power, bio gas ,organic
agriculture.
3. Human and Social Development relates to education, skill training,
social welfare, social security, health, nutrition, inter and intra group
development and harmony, strengthening local democratic
institutions through the participation of women, landless and socially
disadvantaged groups.
4. Empowerment of participants rural development remains incomplete
without empowerment of its participants which includes skill and
knowledge development, entrepreneurial development, attitude and
behavioural changes, self employment and asset building, capacity
building, gender equality and empowerment in all aspects-social,
economical and political.
In short, sustainable rural development is the process of empowering
people that ultimately leads to holistic development which is sustainable in nature in
terms of its longevity and continuity of livelihood practices of people. It results in a
wider distribution of benefits and participation of weaker section of the rural
population in the process of development.
2.1.4 Voluntary Organisations
Traditionally Non Governmental Organisations(NGOs) are known as
Voluntary Organizations (VOs) and Voluntary Agencies (VAs) and recently as

9. 40
Voluntary Development Organizations (VDOs). Voluntary organizations work at the
grassroots levels. Even in areas not reached by others, their reach is wider. They are
closer to ground realities and they focus on the development of rural poor. They work
for the welfare of the disabled, development of women and children, prevention of
human rights violation, protection of environment, rehabilitation of people displaced
by major irrigation projects, enforce the right of access to information etc., and above
all they reform and develop the society. Prahalad (2008) says that the NGOs are very
close to the communities they serve; therefore, they understand their needs and
opportunities and they are able to provide solutions. Right from the beginning of SHG
movement in India, NGOs are playing facilitating and nurturing role for SHGs in
providing training, capacity building, skill development and marketing SHG products.
NGOs in our country are serving as catalysts to transform rural women into micro
entrepreneurs at the grass root level.
Damodar and Laxmi(2006) identified the role of Non Governmental
Organisations in rural development in the following lines9
1. Staff of Non Governmental Organisations has good rapport with
rural people. They have knowledge of local resources. They are
aware of their needs and they ensure participation of the poor in
projects.
2. They operate with greater flexibility and readjust their activities
quickly since they learn from their success and failure quickly.
3. They are committed and devoted to reduce the sufferings of poor.
4. They are being viewed as more efficient and cost effective than
Government in reaching the poor.
5. Participatory methods of rural development are well known to Non
Governmental Organisations compared to Governmental Organisations.

10. 41
2.2 Review of Literature
2.2.1 Self Help Groups
2.2.1.1 Positive impacts of SHG
Puhazhendi and Satyasai (2000) studied socio-economic impact of Self Help
Groups and found that the overall impact of Self Help Group was significant both on
social and economic spheres of the house hold. Their research reveals the following:
 Economically weaker section accounted for 84 per cent of the
membership (small farmers 29 per cent, marginal farmers 23 per cent
and agricultural labourers 32 per cent)
 Average value of assets per household of INR 6843 during pre Self
Help Group period increased to INR 11793 during post Self Help
Group situation. About 58.6 per cent of the sample house hold
registered an increase in assets from pre to post Self Help Group
situation.
 Only 23 per cent house holds were saving before forming Self Help
Groups and 100 per cent of house holds were able to save after
joining Self Help Groups.
 The average net income of INR 20177 per year from the income
generating activities before Self Help Group has increased to INR
26889 after group formation, recording 33 per cent increase.
 Members were relatively more assertive on confronting with social
evils and problem situations and the groups significantly contributed
to improve self- confidence and the feeling of self worth of the
members. Their study concluded that the impact of micro finance
was relatively more pronounced on social aspects than economic
aspects. 10

11. 42
Nedumaran et al. (2001) studied the performance and the socio economic
impact of SHGs in Tamil Nadu and found that there was an increase of 23 per cent in
the net income in the post SHG situation, compared to the pre-SHG situation. Social
conditions of the members also considerably improved after joining the Self Help
Group.11
Puhazhendi and Badyata (2002) studied the impact of Self Help Groups in
Orissa, Chattisgarh and Jarkhand. Their findings are as follows.
1) The Self Help Group – Bank linkage programme with better access
to credit brought increased income to the Self Help Group members
and the incremental net income was the result of loans for productive
purposes in farm, off-farm and non-farm activities.
2) Easy and timely availability of credit enhanced different economic
activities which increased employment in non-farm and off-farm
employment.
3) Self Help Group linkage programme impacted social empowerment
i.e. self worth, treatment by neighbours, quality of treatment by
members of family, involvement in group activity, confidence in
managing financial crisis of the family, decision making capacity in
household matters and assertiveness in protesting against social evils
like drinking, gambling and wife beating. 12
Krishnaiah (2003) studied Self Help Groups in Andhra Pradesh and
observed that as a result of group formation, women were able to diversify their
activities by undertaking non-farm and animal husbandry related activities. He
concluded that repayment of loans by the groups is very high because of peer
pressure, members are known to each other and they are aware of the credit

12. 43
worthiness of members and the good performance of repayment from members to
groups and groups to banks helped to get higher loans subsequently.13
Silvia (2004) studied Self Help Groups in Tumkur district (Karnataka)
covering 245 respondents. She reported that 19 per cent women said that increase in
income is about 25 per cent, 35 per cent women said increase in income is about 50
per cent and 4 per cent women said there was no change in income. She observed
that women have clear idea about loan priority and they are aware of their own skills
and abilities and women are active in community activities.14
Rao (2004) reviewed the genesis and development of Self Help Groups in
India and revealed that existing formal financial institutions failed to provide finance
to landless, marginalized and disadvantaged groups and experiences available in our
country and elsewhere suggested that Self Help Groups are sustainable, have
replicability, stimulate savings and help borrowers to come out of poverty. Number of
studies revealed that Self Help Groups helped in improving the socio-economic
conditions of members.15
Purushotham (2004) studied Self Help Group members in Pamidi
(Anantapur district) in A.P. and concluded that 90 per cent of the micro credit
borrowers utilized micro credit to graduate from wage work into self employment
and concluded that micro credit intervention has benefited the group members in the
acquisition of productive assets, repayment of old debts, increase of income and
savings, construction of toilets, sending girl children to schools, purchase of jewels
and enhancement of employment ratio. 16
Usha et al.(2004) studied SHGs in Chittoor district (AP)and observed that
micro credit increased their access to financial resources both inside and outside the
house hold and it made poor women financially self reliant. They reported that 79 per
cent respondents informed that micro credit increased their income and savings, 64

13. 44
per cent respondents expressed better awareness on health, 72 per cent respondents
were aware of developmental programmes and 70 per cent respondents were aware of
financial schemes as a result of discussion during weekly meetings.17
Lalitha and Nagarajan (2004) studied Self Help Groups in Dindigul,
Madurai and Theni Districts in Tamil Nadu and concluded that organization of
women in the form of Self Help Groups has laid the seeds for economic and social
empowerment of women. Participation in group activities leads to changed self
image and organizational and collective action, enhances access to information and
skills, broadens their knowledge about resource availability and develops leadership
qualities. The culture of active participation in group leads to improvement in
political acumen which would in turn strengthen and sustain the overall process of
empowerment. 18
Indira and Rao (2005) studied SHGs in Andhra Pradesh and found sizable
increase in number of days of employment. They concluded that substantial economic
empowerment has taken place. Regarding social empowerment they found that Self
Help Groups bring out leadership quality in rural women who are mostly introvert and
remained within four walls of the house and there is definite betterment in their
quality of life. The respondents were actively involved in anti liquor campaign and
fought against atrocities on women and the women recognized their role in alleviating
poverty.19
Lakshmamma (2005) studied DWCRA groups in Prakasam District of AP
and found 95 per cent of respondents out of 435 respondents informed that there is an
improved economic position after joining the group and only 12 beneficiaries out of
435 felt that there is no improvement in their economic condition. She found a
substantial change in the consumption pattern of the sample beneficiaries and 304
respondents accepted increased expenditure on food, 20 per cent of respondents

14. 45
incurred more expenditure on children’s education than in the past and 12 per cent of
respondents spent more on entertainment and she concluded that participation in
groups has improved the economic position of the beneficiaries and their family
members.20
Parameswaran (2005) studied 347 SHGs formed in Panchayat Level
Development Planning (PLDP) in Kerala and observed that keeping money in bank
accounts in the own name of women and enjoying freedom of spending that money
as they wished were in fact new experience for many of them. When women gained
control over their earnings, they got more freedom in domestic decision making,
gained confidence, cut down wasteful expense and enjoyed better status in family and
in social circles. Women associated with SHGs became self reliant in the management
of their activities especially in decision making, bookkeeping, conflict resolution and
to a certain extent in the management of micro enterprises.21
Dogra (2005) studied Self Help Groups in Saharanpur district of Uttar
Pradesh and found Self Help Groups are successful in breaking the stronghold of
money lenders; and families do not go to money lenders as forced labour and need not
mortgage land or valuables as a result of SHG. 22
Rao (2005) narrates the benefits and gains of Self Help Groups after his
study of SHGs in Midnapore district of West Bengal:
1. Increase in self confidence and social status.
2. Improvements in leadership qualities and managerial skills and they
become part of decision making process in family and community.
3. Better understanding of immunization of children; education of
children.

15. 46
4. Income of members increased and assets created because of
economic activities leading to significant improvement in the
standards of living of the members and their families. 23
Meenakshi (2006) studied Self Help Groups in Uttranchal and reported
greater awareness regarding their roles, responsibilities and rights due to their
participation in group meetings, training programmes and exposure visits which have
led to confidence building and social self esteem among women. She observed that
their election as Panchayat sarpanch is also reflective of the participation of women in
decision making involving issues related to Natural Resource Management.24
Leelavathy and Aradhana (2006) studied Self Help Groups in Nalbari
district of Assam and reported that 69 per cent of the respondents had a high degree of
participation in decision making and most of the members of the group expressed that
they were economically empowered after joining Self Help Groups. They concluded
that Self Help Groups brought about a sea change in personality, equipped with
problem solving ability and enhanced self confidence. 25
Farrington and Priya (2006) reported that a survey of 400 SHGs in Andhra
Pradesh has shown that 61 per cent of groups revealed decrease in indebtedness and
30 per cent of groups felt that they have been socially empowered. They concluded
that SHGs are being viewed as a route for implementing social protection schemes.26
Panda (2006) studied 80 tribal Self Help Groups in Kandhamal district
and reported that the highest number of Self Help Groups ( numbering 30 and
constituting 37.5 per cent) were formed with a view to receive economic benefits
followed by 20 Self Help Groups (25 per cent) for upgrading traditional occupation
and relieving debt burden. 27

16. 47
Karmakar (2008) reported that studies conducted by various experts have
shown that the Self Help Groups have indeed helped in the social and economic
empowerment of rural women at the same time delivering crucial financial services.
SHG has expanded as the largest micro finance programme in the world in terms of
its outreach and has extended banking service to people hitherto not served by the
banking systems. 28
2. 2.1.2 The other side of SHGs
Some studies have shown the negative impact of SHGs. A sketch of such
studies that criticize the functioning of SHGs is presented in the following paragraphs.
Datar and Prakash (2004) found throughout the country SHGs are
successful in covering non-bankable credit needs but not so in income generating
activities. A majority of the women do not have the cultural moorings to become
entrepreneurs; they lack requisite skills, infrastructural facilities and finance.Trainings
are inadequate and there is no linkage between training and credit or credit and
marketing. There is no integration with local economy as there is little demand for
such products. 29
Selvarajan and Elango (2004) observed that some groups charge 24 per
cent interest to the members and it is obvious that the high rate of interest is very
much oppressive causing hardships to the poverty stricken groups. 30
Dhara and Nitra (2005) studied Self Help Groups in Hoogly district of
West Bengal and found the members cannot be said to be hard decision makers and
the empowerment is only at elementary level since they are not confident to carry out
activities on their own. Members are not aware of the banking procedure and leaders
are finding it difficult to maintain account books. 31

17. 48
Sinha (2006) studied 214 SHGs in Andhra Pradesh, Karnataka, Orissa and
Rajasthan and concluded that
 SHG members contribute to women’s election in Panchayat Raj but
do not appear to inform what they can achieve if elected.
 26 SHGs have taken up issues on social justice (i.e.12 per cent of 214
SHGs) such as drunken husband, violence, dealing with dowry,
prevention of child marriage, bigamy.
 Leaders obtained more loans to the tune of 25 to 30 per cent – both in
terms of frequency and amount borrowed.
 Default rate was 28 per cent (high in A.P.); 38 per cent of very poor
members have more over due, in Andhra Pradesh defunct groups
emerging as an indicator of loan default. 32
Swain and Wallentin (2007) studied Self Help Groups in 5 states (Orissa,
Tamil Nadu, Andhra Pradesh, Uttar Pradesh and Maharashtra) and concluded that
there is significant increase in the level of women empowerment over a period of time
(2000-2003). However, it does not mean that every woman has been empowered to
the same degree, but on the average, the Self Help Group members were empowered
over this period. 33
Tripathy and Jain (2008) studied Self Help Groups in Haryana and Orissa
and concluded that micro finance has a negligible income impact on asset less rural
poor, the deprived and disadvantaged. 34
2.2.2 Micro-finance
2.2.2.1 Advantages of micro finance
Goetz (2001) stated that credit brought into house by women, whether they
manage or not, results in greater benefits to themselves, their children and husbands,

18. 49
than does credit in men’s name. It also increased women’s self esteem and contributed
to the formation of social and business networks outside the household.35
Morduch and Haley (2002) informed that there is ample evidence to
support the positive impact of micro finance on poverty reduction as it relates to
millennium development goals. Micro finance is an instrument that under right
conditions, fits the needs of a broad range of the population – including the poorest –
those in the bottom half of people living below poverty line.36
Satyasai (2003) studied the impact of micro finance on the living
standards of the clients (both economic and social aspects) and concluded that micro
finance had positive impact in respect of self confidence, economic and social
development and skill formation in Andhra Pradesh and social empowerment of the
members in Tamil Nadu. 37
Tamizoli and MSSRF team (2004) analysed the livelihood of irula, a tribal
community in Pichavaram mangrove in Tamil Nadu and concluded that formation of
Self Help Groups, micro finance and micro enterprises has helped them to overcome
indebtedness and these three have widened the women’s livelihood options. In micro
enterprises, women see the possibility of employment near their homes and the
concept of sisterhood is powerful and has changed them to a settled life from nomadic
life. 38
Zubair (2004) traced the impact of micro credit on poverty and
vulnerability in Matlab division of Bangladesh and concluded that micro credit
interventions played an important role in reducing vulnerability through smooth
consumption, building assets, providing emergency assistance and contributing to
women empowerment. Participation in the Grameen Bank and Bangladesh Rural
Advancement Committee Credit programmes showed statistically significant impact

19. 50
on women’s mobility and they were able to make purchases and able to participate in
major decisions. 39
Panda (2005) observed that the concept of micro finance was introduced
for overcoming the existing constraints such as cumbersome procedure, insistence on
collateral guarantee, mobilization of promoters’ contributions in providing adequate
credit to the rural poor. He found that 94 per cent of borrowers are women, retention
of assets has also been significantly higher, as evident from the fact that number of
cattle owned by micro finance group members increased by 26 per cent annually
compared to 50 per cent of the beneficiaries of IRDP who are not keeping assets for
more than 2 years. 40
Kumar (2005) studied the economic and non-economic impact of micro
finance in Haryana. His study revealed that there is enhancement of knowledge and
skills of women. They fight against social evils like dowry, female infanticide and
alcoholism and they cooperated with NGOs in the field of protection of environment
and human rights and male chauvinism. He concluded that feudal mindset and shirk
culture are working as stumbling blocks to the success of micro finance in the state of
Haryana. 41
Thorat (2005) observed the following are the main impact of SHG and
micro finance:
1. Micro finance has reduced poverty through increase in income and
enabled poor to build assets.
2. It has enabled households to spend more on education.
3. It has contributed to a reduced dependency on rural money lenders. It
is banking for the poor and not poor banking. 42

20. 51
Anuradha (2005) studied micro credit and women’s empowerment with
reference to the clients of SHARE micro finance. She observed enormous increase in
self confidence among the women. They travelled much more freely in connection
with their business both within and outside the villages. She observed significant
reduction in dependence on money lenders and freedom from money lenders gave
them self respect. Apart from traditional activities like rearing of goat and buffalo,
new activities such as petty shops, stone polishing, readymade clothes, cut piece
shops, fruit, vegetable, flower vending, tea shops and so on were undertaken by
women. Even traditional activities were being given a modern twist such as tailoring
with embroidery, weaving saris combining with dupattas. She concluded that women
have greater control over assets, earnings and savings and increased income resulted
in self confidence and helped them to realize their self worth which transformed
women from low wage workers to owner managers. 43
Simanowitz and Walter (2005) studied the micro finance clients of
SHARE and reported that majority of (59 per cent) the matured clients were non-poor
because they have productive assets worth over Rs.10000 (US$200) bigger houses
made up of permanent materials and improved access to quality clinic as a result of
increased savings and therefore ready to pay for unexpected needs. SHARE clients
experienced increased feelings of confidence and self esteem. Diversified sources of
income, an increase in the number of earners, expenditure smoothening and
accumulation of savings are the favourite aspect of 67 per cent of clients of micro
finance programme.44
Veena (2005) reported that the proponents of micro finance consider
economic empowerment as an entry point and a road map towards overall
empowerment. She found that women were able to access bank credit, displayed good
repayment records and moved from wage work to self employment. They were able to

21. 52
retain their control over their earnings. Women empowerment at individual and
collective level is more visible in semi urban areas than rural areas.45
Nirmala and Geetha (2009) informed that many Indian studies have
reported the positive impact of microfinance. They quoted Puhazhendi and Satyasai
(2000) Nedumaran (2001) Singh (2001) Mishra and Hossain (2001) Rajesh
Chakraborthi (2004) Ajai Nair (2005) Hannover (2005) Jayaraman (2001) Rajat
Wanchoo (2007). Their observations are given below.
1. Micro finance helps very poor households for meeting basic needs
and protecting them from risks.
2. It contributes to the improvement in household economic welfare and
enterprise stability or growth.
3. Micro finance is empowering women, bringing gender equality.46
Sashi Rajagopalan (2005) studied micro credit programme of Lokadrusti,
an organization based in Naupada district of Orissa and concluded that women
gained very significantly in terms of mobility, self confidence, access to financial
services, building of own savings, competence in public affairs and improved status
at home and in the community. 47
Kalpana (2005) reported all micro finance loans created assets and 61 per
cent of women have complete control over household expenditure and 18 per cent of
members and their husbands, who were labourers, have moved from worker to self
employed status through micro finance loans. 31 per cent of members indicated that
consumption of food has increased; 92 per cent member house holds accessed 3 meals
a day, in contrast to 60 per cent before the commencement of micro finance.48

22. 53
Kabeer and Noponen (2005) have studied the impact of micro finance
among PRADAN members and found that they had more nutritious food, and
enjoyed a favourable food situation. They had more of livestock, diversified cropping,
high value crops, higher savings and reduced indebtedness. 49
Sinha (2005) made following observations regarding outreach of
microfinance.
1. Poor clients use a higher proportion of micro finance for household
needs (37 per cent) and 63 per cent clients invested in micro
enterprises (Non farm enterprises 36 per cent, animals 14 per cent,
agriculture 13 per cent)
2. Micro credit has enabled client households to invest in productive
assets and to diversify their livelihoods (73 per cent of the clients
have multiple sources of income). Sixty per cent of households that
acquired a productive asset have reported an increase in their
income.
3. More than 60 per cent women who had access to micro finance had
little or no schooling but drew moral support from their peers and
developed a sense of confidence from group meetings. 50
Impact Assessment Study conducted by EDA (2005) has revealed that
investment of micro finance loan had resulted in increase of income. The investment
from micro finance has provided around 24 per cent of the new employment due to
newly started enterprises. In terms of livelihood security, client households have a
slightly higher number of income sources in comparison with non-client households
and a lower dependency burden. It is a clear example of positive shifts that have
occurred in livelihood due to successful enterprise supported by micro finance.51

23. 54
Devi (2006) studied the impact of micro credit on women empowerment in Kerala
and reported that there was increase in monthly income in 87 per cent of households
and there was no change in income in 13 per cent of households. Majority of the
women (67 per cent) reported that they had complete control over the income earned
by them, 20 per cent reported that they had only partial control over their income and
13 per cent women reported that they had absolutely no control over their earnings;
but in all these cases responsibility of repayment fell only on women. She also found
that overall economic conditions of households have definitely improved. Sixty per
cent of beneficiaries reported improvement in the quality of food consumption (like
fish, meat) 48 per cent beneficiaries reported that they bought consumer durables
through hire purchase and 39 per cent reported about better educational facilities for
children. Majority of the women beneficiaries (42 per cent) reported that there is high
degree of empowerment, 31 per cent reported medium empowerment and 27 per cent
said that the micro credit did not give in any significant improvement. She concluded
that the micro credit helped in poverty alleviation and empowerment of rural women
and the income generating activities made a difference in the lives of poor women by
providing economic independence, self confidence and autonomy.52
Sharma (2007) concluded that micro finance through Self Help Groups is
contributing to poverty reduction in a sustainable manner and significant changes
have taken place in the standards of living of rural women in terms of increase in
income level, assets, savings, borrowing capacity and income generating activities.53
Gaiha and Nandhi (2007) studied the impact of micro finance in Pune
district and observed that 98.6 per cent respondents informed that their self
confidence improved and 72.6 per cent respondents informed that they actively
participated in village Panchayat. 54

24. 55
Magner (2007) concluded that micro finance is an important catalyst for
poverty alleviation to 57 per cent participants of BRAC and 76 per cent participants of
Grameen bank. Magner quotes Khandker who had estimated that more than half the
level of poverty reduction is directly attributed to micro finance and he comments that
micro finance accounted for 40 per cent of the reduction of poverty in rural
Bangladesh. Magner concluded that numerous studies have indicated that micro
finance can improve overall income, increase in decision making power and provide
general self empowerment. 55
Sharma (2007) studied the effect of Micro finance in Nepal during 2004-
06 and concluded that women take greater role in household decision making and
have greater access to financial and economic resources, greater social network and
better bargaining power. He concluded that micro finance contributed to women
empowerment. The results of his study sail with the previous studies of Kabeer
(1994, 1999) Khandker (1999) Park and Sen (2001) Mayoux (2001) Hulme and
Mosley (1996) Moser (1993) Friedman (1992) and his study disagrees with Goetz and
Sen Gupta (1996) Coleman (1999, 2004) Amin et al (2003). 56
Malapur (2008) reported that in many countries micro credit programme,
as an effective instrument, facilitated the people to overcome their difficulties and at
the same time helped them to come out of the clutches of poverty and enabled them to
increase their participation in the economic and political process of the society. The
economic activities have had a positive impact and the benefits are not merely
economic, but also helped the women to gain qualities of leadership and attain self
confidence and self respect. 57
Rajagopalan (2009) studied micro finance in Africa. His study revealed
that micro finance in Africa lags behind when compared to other parts of the world,
though the sector is growing in Africa. Micro finance in Asia is the largest both in

25. 56
terms of MFIs and outreach. He concluded that Africa is known for chronic poverty
which needs poverty alleviation programme and micro finance is one such
programme. 58
Ghosal (2009) analysed the global financial crisis and informed that micro
finance is not affected by the crisis because they have been able to maintain an
enviable repayment record and also generate sustainable business for the poor and
neglected section of the society. 59
2.2.2.2 Demerits of micro finance
Goetz and Gupta (1996) evaluated micro credit in relation to women’s
empowerment and their study showed that 37 per cent (out of 253 respondents)of the
women had full or significant control of loan use, 17 per cent had very limited
control and 21.7 per cent had no control. They also found that the women’s loans
were used by their husbands also and they further found that 28 per cent of the loans
were invested in conventionally female productive activities, 56 per cent in male
activities and the rest in family activities. Their study also reported that 60 per cent of
women, who were widowed, separated and divorced retained full control of loans, as
against 10 per cent of married women. 60
Pallavi and Kumar (2002) concluded that micro credit brought a marginal
improvement in the beneficiary’s income and the beneficiaries have not gained much
by technological improvement. They concluded that repayment culture of Grameen
bank resulted in the creation of debt cycles. 61
Priya and Srivastava (2005) studied the extent of micro finance outreach
and reported that at all India level less than 5 per cent of rural households have access
to micro finance as compared to 65 per cent in Bangladesh. 62

26. 57
Farida (2006) criticized the micro credit as a capitalist programme since it
is based on high interest rate and strict regularity of payment schedule but it is called
as a poverty alleviation programme. The poor must pay a high rate of interest for a
meagre amount of credit called micro credit. When women are demanding to enter
macro economy, the micro credit has brought them to micro level. They carry out
micro trade for micro credit with high interest rate which even the biggest industrialist
is not paying. It is the joke of the present era of globalization.63
Karani (2007) studied the impact of micro finance and concluded that
micro loans are more beneficial to borrowers above the poverty line than to borrowers
living below the poverty line because clients with more income are willing to take
risks that will most likely increase income flow. He informed that according to Vijay
Mahajan micro loans reduce the cash flow to the poorest of the poor and micro credit
does more harm than good to the poor, operates at too small scale and makes very
meagre earnings and most people do not have the skills, vision, creativity and
persistence to be entrepreneurial. The reality of micro credit is less attractive than the
promise. 64
Dulal, Gingrich and Stough (2008) studied the microfinance programme in
rural Nepal and observed that micro finance programmes really helped relatively
wealthy people and poor people are less satisfied because of strict rules, procedures,
rigid repayment schedules and caste system. 65
2.2.2.3 Mixed picture of micro finance
Jaya (2005) studied the impact of micro credit programme on physical
assets and amenities in Kerala and found that 28 per cent of the members acquired
livestock and 12 per cent respondents renovated or constructed their houses. But there
is an improvement in knowledge level and social interaction among members after
joining the groups. About 91 per cent of members learned about banking system and
were confident in dealing with bankers which they could not have dreamt earlier.

27. 58
They also found that the returns from micro enterprises are hardly sufficient to meet
daily expenses of the unit resulting in poor repayment of loans.66
Makumbe et al (2005) studied the impact of micro credit in Tanga region
of Tanzania covering 268 households. Their study has revealed that a good
proportion of women respondents felt that they were more involved in decision
making after taking loan than before. Fifty per cent of respondents only acquired more
skills and the remaining acquired less skills. Respectability of women increased in the
eyes of husbands and community after their participation in credit schemes. The study
concluded that success is due to cooperation from husbands, marketing of the
products, hard work, efficient management, training and skills and inhibitory factors
were inadequacy of funds, lack of skills and high running costs. 67
Ranjani et al. (2005) reported that there is a debate globally on whether
micro credit can really address poverty and women’s empowerment; with one group
holding that micro credit is the answer to both problems and another group arguing
that this is far from truth and in fact women are exploited through participation in
such programmes. They indicated that both positions are not really correct and the
result is somewhere in between. 68
Malhotra and Schuler (2006) reported conflicting results. Some studies
conclude that micro credit participation is empowering women in Bangladesh
(Hashemi, Schuler, Riley 1996 Kabeer 1998) while others conclude that it is not
(Goetz and Gupta 1996) and the empirical research also indicated contextual
differences in the impact of micro credit programmes Studies in certain settings find
a substantial positive impact on outcomes such as household expenditure and
contraceptive use (Pitt and Khandker 1998, Schuler and Hashemi, Schuler, Hashemi
and Riley 1997). But those on some other settings do not find such effects (Schuler,
Hashemi, and Pandit for India, Mayoux for Cameroon, Schuler, Jenkins and
Townsend 1995 for Bolivia) 69

28. 59
Maggiano (2006) surveyed micro finance clients in Kabale, (rural area
close to Rwandan and Congolese border) Uganda, to find whether micro finance had
measurable impact on clients’ social, spiritual and economic lives. He concluded that
micro finance programme had a significant impact on the clients’ social and spiritual
development but no impact on economic development. 70
Maithreyi (2007) found that there are both positive and not so positive
appraisals of how exactly micro finance helps women and to what extent. Despite its
outreach, the Self Help Group advances form only 0.15 per cent of priority lending
and 0.51 per cent accounts of scheduled commercial banks. She feared that
inadvertently micro finance leads to a kind of involuntary diversification where the
rural household engages in a multiplicity of low productivity enterprise-a goat here, a
cow there and so on. It is not denied that members increased their assets.71
Sinha (2007) found that one in five women client manage the enterprise by
themselves for which they availed credit, another 40 per cent manage with husband
and son and 40% pass it to others and this is the empowerment. Sinha also found that
majority of the enterprises supported by micro finance are usually family micro-
enterprises and 8 per cent only have non-family labour. If hired labour is employed in
an enterprise, micro finance can be seen to be supporting employment for others who
are not direct micro finance clients. 72
Rajagopalan (2007) described that often, exaggerated claims are made
about SHGs building housing colonies and bridges, doing a roaring export business
etc. Since these SHGs comprise of rural women barely literate, such claims look
incredible. Yet, the fact remains that micro credit has liberated lakhs of families in
villages from the clutches of predatory money lenders. It is also true that almost in
every village some rural entrepreneurs have emerged with guidance from NGOs,
DRDA, banks and other financial institutions. 73

29. 60
Herms (2007) found that most studies reported that micro credit positively
contributes to poverty reduction. Micro credit, therefore, may help to solve poverty
problem. After having reviewed the debate on micro finance and poverty, he
concluded that it is still unclear whether micro finance substantially contributes to a
reduction of poverty nor it is clear whether micro finance is the most efficient method
to reduce poverty. Hermes suggested that more solid empirical research is needed. 74
2.2.3 Constraints and problems
This section highlights some of the constraints and problems identified by
the earlier investigators.
Rahman (2002) studied the problems in micro finance in Malaysia and
identified following three constraints.
1. Lack of funds.
2. Delinquency in repayment. Default remains a major constraint in
micro finance program.
3. Political intervention in the selection of beneficiaries and
identification of activities.75
Vadivoo and Sekar (2004) listed the following constraints of Self Help
Groups.76
1. Political interference in the selection of the beneficiaries to the
schemes
2. Lack of timely and adequate credit
3. Lack of farm women oriented schemes.

30. 61
Vanitha and Krishnamurthy (2004) studied 120 respondents in 74 Self
Help Groups in Bangalore rural district and found the following as the problems
faced by members of Self Help Group. 77
1. Family restrictions,
2. Non availability of proper place for meetings
3. Lack of clear information and guidance and
4. Low support from the family
Ramanunny (2005) identified following problems when women undertake
micro enterprises in Kerala. 78
1. Inadequate capital.
2. Delay in sanctioning of loan.
3. Poor or incomplete business plan.
4. Inadequate understanding of market and market conditions.
5. Lack of customer awareness.
6. Lack of technical know how and unfamiliarity with business.
Rao (2005) reported the following problems of Self Help Groups with the
banks79
1. Lack of orientation and initiative of bank staff to the concept and the
needs of Self Help Groups.
2. Banks insistence on collaterals for loans to groups.
3. Discouragement by some banks not to form more groups as it means
more work for them.

31. 62
Chaim (2006) identified the deficiencies of micro finance.
1. Loans to members not based on purpose of loans.
2. Irregular group meetings, lack of proper bookkeeping.
3. Lack of confidence among the bank branches to extend loans to Self
Help Groups in the absence of NGOs.
4. Lack of proper understanding and coordination between and among
Self Help Group, NGO, and Government departments.
5. Treatment of entire savings of Self Help Groups by banks as
collateral security for the loans. 80
Bhuvaneswaran (2006) observed that the following are the constraints
faced by self Help Groups in India.
1. Lack of understanding of goals.
2. Inability of government to identify the types of non-governmental
organizations that might become reliable working partners.
3. Restrictive government procedure.
4. Lack of government policy and guidelines on non-governmental
organization.
5. Poor communication among non-governmental organization.
6. Sharp contrast between the top-down working methods of
government, and the participatory approaches of non-governmental
organization.
7. Lack of existing linkage among institutions.
8. Poor understanding of relative strength and weakness on both sides.

32. 63
9. Lack of non-governmental organization accountability to their
clients, or to the public at large, for the way in which resources are
used. 81
Lalitha (2007) identified following problems as the causes of failure for
SHGs. 82
1. Vested interest of NGO.
2. Lack of training.
3. Accounts and financial transactions are not kept properly.
Ahmad (2006) identified low returns and overemphasis on repayment as
the major problems. 83
Ghate (2007) identified inadequate loans and long waiting period to get
loans as major problems in Andhra Pradesh. 84
Kumari and Malathi (2009) identified lack of cooperation and
understanding among members and conflict between leaders and members based on
caste and locality as the main problems85
Kallur (2009) identified lack of capital and labour as main problems faced
by theSHGs.86
Swain (2009) studied the capacity building process through training and
exposure. His study concluded that 47 per cent groups did not get any training or
exposure and only 27 per cent of groups only trained in IGA. Most of the other
trainings were related group management, book keeping and leadership development.87

33. 64
2.2.4 Role of NGOs
This section brings out the role played NGOs in delivery of micro finance,
empowerment and other activities and programmes for bringing about social
revolution through SHG models.
Kumaran (2002) studied the micro enterprises promoted through the micro
credit intervention in Pune. He studied 10 SHGs promoted by NGO and 5 groups
promoted by DRDA and interviewed 90 respondents. He concluded that due to
technical training and escort services provided by the NGOs, the micro enterprises set
up by them were more viable and sustainable than those promoted by DRDA where
these services were lacking.88
Joel (2003) observed that NGOs organize SHGs with the objectives of
inculcating self help attitude among women, developing leadership qualities and
enhancing women’s participation in development programmes. 89
Sarojini (2004) studied the role of NGOs in educating rural women for
rural development in Gurgaon district and observed that many programmes launched
by the government have not reached the rural people and NGOs play a vital role. She
found that 36 per cent respondents (out of 150 women) appreciated the role of NGOs
in making them aware of various activities and helping them to participate in those
activities but 30 per cent respondents are aware of neither the role of NGOs nor
welfare schemes. 90
Mishra (2005) identified that the failure in governance in third world
countries is one of the main reasons which encourages NGOs to fill in the vacuum. In
Kenya and Tanzania NGOs occupy the major portion in the health system and in
Northern Pakistan the Aga Khan Rural Support Programme is the leading actor in
rural development. 91

34. 65
Priya and Srivastava (2005) reported that NGOs have inculcated the
culture of savings and repayment, strengthened the groups’ capacity to undertake
administrative tasks (accounting, maintaining the minutes of meetings,
correspondence and negotiations with banks) and commercial skills (business start
ups, marketing and reinvestments) ensuring members to remain financially
sustainable and have the ability to withstand accidents, sickness and natural
disasters etc. 92
Shylendra (2007) found that NGOs in India have played a crucial role in
the spread of micro finance. Their success in delivering micro finance has made
many of them to explore the possibility of scaling up their operations further.93
Rahman (2007) studied the role of NGOs in empowering women in rural
Bangladesh and concluded that NGOs have undertaken a wide range of activities in
empowering women in Bangladesh and the issues involve economic, political and
social as well as environmental concerns of women. 94
Mayoux (2007) informs that Micro finance has been strategically used by
some NGOs as an entry point to wider social and political mobilization of women
around gender issues. Micro finance groups have been used by some programmes as
the basis for mobilizing women’s political participation. 95
Thirunarayanasamy and Thirumaran (2007) observed that NGOs are
promoting groups that can generate a sound base for their members and encourage
financial institutions to develop confidence in establishing a lending relationship with
the groups96
Ramachandran (2007) narrated that NGOs are playing a vital role in group
formation and monitoring and mobilizing resources and the goal of women

35. 66
empowerment can be realized through active involvement of NGOs in micro
finance97
.
There are some strong criticisms about the role of NGOs, which are given
below.
Laxmi and Archana (2005) found that NGOs’ role in reaching the poorest
in the country is limited only since their service delivery is taking place in the already
better-off region while the poorest states are left out and most of the income
generating activities facilitated and promoted by the NGOs generate income which
forms only a small proportion to the total income of the family members.98
Ghosh (2005) while reviewing the role of NGOs in poverty alleviation
observed that it is a fact that NGOs are no panacea for all the ills impairing the
development process. 99
Ahmad (2006) observed that the rapid growth of NGOs both in terms of
resources and influence are not accompanied by their effectiveness in dealing with
poverty and illiteracy and empowering the poor and NGOs are not alternative to the
state; they can complement the activities of the state100
2.2.5 Sustainable Rural development
This section explores the need for Sustainable Rural development
Sharma (2006) observed that the prime goal of Rural Development is to
improve the quality of life of the rural people by alleviating poverty through the
instrument of self employment and wage employment programmes by providing
community infrastructure facilities such as drinking water, electricity, road
connection, health facilities, rural housing and education.101

36. 67
Muktasam and Chamala (2000) reported that Chambers, Harrison and
Hammer after studying the working of rural development programmes in Asian
countries Pakistan, Sri Lanka, Bangladesh, Thailand and India as well as in African
countries Uganda, Mali and Ethiopia, identified following reasons as major causes of
failure
1. Targeting and top down approaches.
2. Neglect of local values.
3. Lack of people participation.
4. Partial and disintegrative approach.
5. Investment illusion.102
Bhowmick (1994) evaluated rural development schemes in West Bengal
and found the implementation of schemes which were not relevant to the area, the
inexperience of the implementing agencies and lack of coordination and cooperation
among them as the major problems associated with rural development programmes.
Most of the schemes failed and others yielded very little desired results; rich and
wealthy sections of population benefited; uneducated rural poor remained as poor as
before.103
Setty (2002) concluded that political will, clear cut policies, realistic
objectives, a blending of planning from below and above, enlightened involvement of
client system, training of people’s leaders and building up and strengthening of local
institutions will facilitate meaningful and sustainable rural development.104
Paul and Paul (2003) opined that holistic approach towards rural
development has to be taken into account which includes augmentation of quality of
life of rural masses and it should be community-driven, community-led and
community-owned.105

37. 68
Hegde (2006) identified following critical factors which will empower the
poor and play a critical role in the sustainable rural development in our country
1. Motivation and training of the weaker sections of the society.
2. Introduction of multi disciplinary programmes.
3. Introduction of appropriate technologies.
4. Establishment of people organizations to sustain development.106
Kaul (2004) observed the following thrust areas which are important and
meaningful to the sustainable rural development.
1. Wasteland development.
2. Need based tiny technologies.
3. Water harvesting and related technologies.
4. Low cost housing, sanitation and roads107
.
Maithai (2006) informed all round development of rural areas and
development of the weaker sections of the population as the objectives of successful
rural development programme and the main focus is eradication of poverty in rural
areas. 108
Singh (2006) indicated that definition given by World Bank is applicable
to all developing countries. “Rural development is a strategy designed to improve the
economic and social life of a group of people-the rural poor. It involves extending the
benefit of development to the poorest among those who seek a livelihood in the rural
areas. The group includes small farmers, tenants and landless.” Robert Chanks
suggested a modification in this definition to include rural women and children who
may not seek a livelihood in the rural areas but would also seek to demand and control
more benefits of development. 109

38. 69
Gandhiji wanted people to live in harmony with nature and advised people
to preserve land and forests. He emphasized eco friendly small industrial units and
cattle based economy in terms of dairying, bio fertilizers etc. Gandhiji desired that
each village should evolve as a self sufficient unit and through self help the villagers
should collectively strive for all round development. In keeping with Gandhian
ideology, focusing on villages as the point of development, addressing simultaneous
growth of agriculture and micro enterprises and community based programmes is the
right approach for sustainable rural development.110
Conclusion
The micro finance revolution, a recent product of development, ensures the
availability of institutional credit and financial inclusion to the poor, who were so for
excluded from the institutional credit system. The literature review has shown the
impact of micro finance and self Help Groups as a mixed picture, but it is an effective
instrument and tool to pull the poor households from poverty in developing countries
where it becomes a philosophy and practice of poverty eradication, empowerment and
inclusive growth, especially in Asia, Africa and Latin American countries. Studies
carried out in India, as evident from the above literature review, indicated that micro
finance and Self Help groups, by and large contributed to the development of core
poor in terms of economic well being, alleviating poverty and empowerment leading
to over all development of rural poor.
In India, most of the literature on micro finance revolves around four
southern states where Governments and Non Governmental Organisations are taking
lead in the spread of micro finance. The real impact of micro finance should result in
the creation of employment opportunities and micro enterprises. As suggested by
Prahalad (2008) when the bottom of the pyramid i.e. four billion people are converted
into micro producers, opportunity for global growth becomes obvious.111
The real

39. 70
effectiveness and success depends on alleviating poverty by converting the poor into
producers which will increase the income of the rural families. In the light of the
background and observations on various issues connected with SHG, micro finance,
role of NGOs and the sustainable rural development, the present study attempts to
analyse the effectiveness of microfinance in sustainable rural development.

40. 71
References
1. Vijaykumar, R. (2009). Reinstating the Self Help Group: Perspective in micro
finance. Economic and Political Weekly, XLIV (15), 68-69.
2. Malapur, Rashmi. (2008). Empowering women through Self Help Groups and
Micro credit in India. Professional Banker.VIII(1) January, 2008, p64.
3. Srinivasan, R., & M.S.Sriram.(2003). Micro finance: An introduction, IIMB
Management Review, 15(2,) 52-53.
4. Sharma, K.C. (2007).Micro finance through Self Help Groups, Professional
Banker, December 2007, 29-36.
5. Ibid.
6. Hermes, Niels., & Robert Lensink. (2007). Impact of Micro finance: A
critical Survey. EPW, XLII (6), 462-465.
7. Basu, Priya.,& Pradeep Srivastava. (2005). Exploring possibilities: Micro
finance and Rural Credit Access for the poor in India. EPW, 40(17) 1747-
1756.
8. Barnala, Surjit Sing., (1979). New Strategy for Rural Development.
Yojana,XXIII (4), 5-8.
9. Suar, Damodar.,Laxmi Bilash Hota., & Himadri Sinha.(2006). Non-
Governmental Organisations in Rural Development. In M.C.Behera (Ed.)
Globalising Rural Development. (pp. 160-182). New Delhi: Sage
Publications.
10. Sarkar,A.N.(2003).Innovations in Self Help Group led Micro finance
Development:Programmes Sharing of global experience, Indian Cooperative
Review,4(1), 12- 31.
11. Nedumaran, S., K. Palanisami., & L.P.Swaminathan. (2001).Performance and
Impact of Self Help Groups in Tamil Nadu. Indian Journal of Agricultural
Economics, 56(3), 471.
12. Puhazhendi,V., & Badatya K.C.(2002). Self Help Group Bank linkage
programme for Poor: An impact assessment. Paper presented at Seminar on
Self Help Group – Bank Linkage programme at New Delhi 25, 26-11-2002.
13. Krishnaiah, P. (2003). Poverty Reduction: Self Help Group strategy. New
Delhi: UBSPD, pp65-68.
14. Kova,Silvia Jut.(2004). Impact of Self Help Groups on women’s Lives in
selected area of Karnataka. Pune: BAIF Development Research Foundation,
p 20.

41. 72
15. Rao,V.M.(2004).Empowering Rural Women. New Delhi: Anmol Publications,
2004.pp157-179.
16. Purushotham, P. (2004). Micro credit for micro enterprises Paper presented
during course on Micro finance and credit for the poor 23 to 28.2.2004.
Hyderabad: NIRD.24-37.
17. Rani,Usha., D.P.J.Reddy., & M.V.S.Reddy.(2004). Women Development:
Empowerment through Self Help Groups in Andhra Pradesh. In Kiran Prasad
(Ed.) Communication and Empowerment of Women (vol.2 pp616-624).
New Delhi: The Women Press.
18. Lalitha.B., & B.S. Nagarajan.(2004). Empowerment of Rural Women through
Self Help Groups: A study in Tamil Nadu.In R.Venkata Ravi, N.Narayana
Reddy and M.Venkataramana (Eds.) Empowerment of People. (pp 73-
85)New Delhi: Kaniska Publishers &Distributors.
19. Kumari, Indira.Y., & Sambasiva Rao,B.(2005).Development of Women and
Rural Development. New Delhi: Serial Publications, pp214-306.
20. Lakshmamma, Sree. K.(2005). Empowerment of women through DWCRA
program in A.P.: A case study. In Koteswara Rao (Ed.) Empowerment of
women in India (pp 283-338).New Delhi: Discovery Publishing House.
21. Parameswaran, M.P. (2005).Empowering people. Delhi: Daanish Books,
pp169-170.
22. Dogra,Bharat.(2005).Women Self Help Groups: Kindling Spirit of
Entrepreneurship. In S.B. Verma (Ed.) Status of Women in Modern India.
(pp361-363.) New Delhi: Deep & Deep publications.
23. Rao, M.V.(2005).Socio-Economic Development of Women: A case study of
Self Help Groups in Midnapore District. In Purnendu Sekhar Das (Ed.)
Decentralised Planning and Participating Rural Development(pp 155-
172.).New Delhi: Concept Publishing.
24. Joshi, Meenakshi. (2006).Empowering Rural Women through water Shed
Project. In S.B.Verma, S.K.Jiloka. and K.J. Khshwah.(Eds.) Rural Women
Empowerment. (pp 147 – 159). New Delhi: Deep & Deep Publications.
25. Chandramani. (2005). Self Help Groups for Empowerment of Rural Women.
In R.K. Samanta (Ed.) Empowering Rural Women: issues, Opportunities and
Approaches,(pp131-150). Delhi: The Women Press.
26. Farrington,John., Priya Desinghar.,& Craig Johnson. (2006). Policy windows
and Livelihood Futures. New Delhi: Oxford University Press.p144.
27. Panda, Govinda Chandra. (2006).Development of Tribal women through Self
Help Groups. In C.Narasimha Rao(Ed.) Rural Development in India, (p87).
New Delhi : Serials Publications.

42. 73
28. Karmakar, K.G. (2008). Trends in Rural Finance. Indian Journal of
Agricultural Economics, 63(1), 5-18.
29. Datar, Chhaya & Assem Prakash (2004).Engendering Community Rights :
Women access to water and wasteland in Gujarat, Maharashtra, Madhya
Pradesh, Andhra Pradesh and Karnataka. In Sumi Krishna(Ed.)
Livelihood&Gender,(pp137-168). New Delhi:Sage.
30. Selvarajan,E., & R.Elango.(2004). Rural Development: Programmes
Externalities. New Delhi: Serials Publications, p 631.
31. Dhara, Aparajita., & Nita Mitra. (2005). Decentralised Development and
Micro credit. In Purnendu Sekhar Das (Ed.) Decentralised Planning and
Participating Rural Development (pp 173-193).New Delhi: Concept
Publishing Company.
32. Sinha, Frances. (2006). SELF HELP GROUPS IN INDIA: A study of the lights
and shades. Hyderabad: A.P.Mahila Abhivruddhi Society.
33. Swain, Ranjula Bali., & Fan Yang Wallentin.(2007). Does Micro finance
Empower women Evidence from Self Help Groups in India. Uppsala
Universitet, Working paper 2007-24, August 2007. Sweeden .http//www.
nekuu.se./working papers.htm.
34. Tripathy,K.K.,& Sudhir K.Jain.(2008).Micro finance and self
employment activities towards income generation and poverty alleviation in
Rural Areas under SGSY: An empirical investigation in Haryana and Orissa.
Paper presented in International Conference on issues in Public Policy and
sustainable Development, March 26-28, 2008. IGNOU, New Delhi.
35. Goetz, Anne Marie. (2001).Women Development workers: implementing
Rural Credit programmes in Bangladesh. New Delhi: Sage Publications. pp
70-75.
36. Morduch, Jonathan & Barbara Haley.(2002).Analysis of effects of micro
finance on Poverty Reduction. NYU working paper 1014, June 28, 2002.
www.nyu.edu/wagner/working papers.html
37. Satyasai, K.J.S. (2002). Micro finance in India: Progress and Perspective. In
Suresh Pal, Mruthyunjaya, P.K.Joshi, Raka Saxena (Eds.) Institutional change
in Indian Agriculture (pp305-320).New Delhi:National Centre for Agricultural
Economics and Policy Research.
38. Tamizoli.P., & MSSRF team. (2004).Mainstreaming Gender concerns in
Mangrove Conservation and Management:The Pichavaram coast,Tamil Nadu.
In Sumi. Krishna. (Ed.) Livelihoods & Gender (pp92-108).New Delhi:Sage
publications.
39. Meenai, Zubair. (2003). Empowering Rural Women. Delhi:Aakar Books,
p83-86.

43. 74
40. Panda, S.K. (2005).Micro finance in Economic Empowerment of weaker
sections. In S.B.Verma(Ed.) Rural Management. (pp 181-190).New
Delhi:Deep & Deep Publications..
41. Kumar, Raj.(2005).Sustaining Rural development: Micro finance in Haryana.
In Surat Singh (Ed.) Strategies for Sustainable Rural Development (pp268-
281). New Delhi: Deep & Deep Publications.
42. Thorat, Y.S.P. (2005).Micro finance in India: Sectoral issues and Challenges
Theme paper- High Level Policy conference on Micro finance in India. 03-05
May, 2005.
43. Rajivan,Anuradha.( 2005).Micro credit and Women’s Empowerment: a case
study of SHARE micro finance limited. In Neera Burra,Joy Deshmukh–
Ranadive and Ranjani K.Murthy(Eds.) Micro credit, poverty and
Empowerment (pp116-160).New Delhi: Sage Publications.
44. Simanowitz, Anton and Alice Walter (2002).Ensuring impact. www.imp–
act.org.
45. Padia,Veena.(2005).Social mobilization and micro credit for women’s
empowerment: A study of the Dhan foundation. In Neera Burra.Joy
Deshmukh–Ranadive, and Ranjani K.Murthy.(Eds.) Micro credit, poverty
and Empowerment(pp161-199).New Delhi: Sage Publications.
46. Nirmala.K.A.and Geetha Mohan.(2009).Socio-economic impact of
microcredit: A Study of Measurement. In Anil Kumar Thakur and Praveen
Sharma(Ed.) Micro credit and Rural Development (pp207-224). New Delhi:
Deep & Deep Publications.
47. Rajagopalan,Sashi.(2005).Micro credit and women’s empowerment:The
Lokadrusti case.In Neera Burra.Joy Deshmukh – Ranadive and
RanjanK.Murthy(Eds.) Micro credit, poverty and Empowerment (pp 245-
285). New Delhi: Sage Publications.
48. Sankar, Kalpana.(2005).Social mobilization and micro finance for women’s
empowerment Lessons from the ASA Trust(Activists for Social Action,
Tiruchirapalli, Tamil Nadu).In Neera Burra.Joy Deshmukh – Ranadive and
Ranjani K.Murthy(Eds.) Micro credit, poverty and Empowerment. New
Delhi: Sage Publications.
49. Kabeer, Naila., & Helzi Noponen.(2005).Social and Economic impacts of
PRADAN’s Self Help Group micro finance and livelihoods Promotion
Programme: Analysis from Jharkhand, India. http//www.lmp.act.org
50. Sinha, Frances. (2005).THE MATURING OF INDIAN MICRO FINANCE.
Guragaon.Eda Rural Systems .pp 6-24.
51. Sa-Dhan.(2005). Sustainable livelihoods and micro finance.New Delhi:Sa-
Dhan.Perspective Paper No.5 March 2005.pp 18-19.

44. 75
52. Devi,Lakshmy.K.R.(2006).Micro credit Programmes: income, Gender and
Empowerment of Women. In M.Meera Bai(Ed.) Women and Economic
Reforms ( pp 23-37). New Delhi: Serials Publications.
53. Sharma K.C.(2007).Micro finance through Self Help Groups. Professional
Banker.VII(12) December 2007.pp 29-36
54. Gaiha,Raghav., & Mani Arul Nandhi.(2007).Micro finance, Self Help Groups
and Empowerment in Maharastra. ASARC working paper; 2007/15.
Canberra:Australia South Asia Research Centre, Australian National
University.
55. Magner, Marge. (2007). Micro finance : A platform for social change
.Grameen Foundation publication series,March2007.p 9.
www.grameenfoundation.org
56. Sharma, Puspa Raj.(2007).Micro finance and Women Empowerment. Journal
of Nepalese Business Studies, 4(1), 6-27.
57. Malapur, Rashmi.(2008).Empowering women through Self Help Groups and
micro credit in India. Professional Banker. VIII(1), 62-69.
58. Rajagopalan,S.(2009). Micro finance in Africa. Professional Banker IX(1),
58-61.
59. Ghosal. S.N. (2009).Global Meltdown and Microfinancing Professional
Banker,IX(2),39-42.
60. Goetz, Anne Marie., & Rina Sen Gupta. (1996). Who takes the credit?
Gender, Power and Control over loan use in Rural Credit Programmes in
Bangladesh’. World Development,24(1), 45-63.
61. Charan,Pallavi.,& R.Ramkumar.(2002).Micro credit and Rural Poverty: An
analysis of Empirical evidence. Economic and Political Weekly, 37(10),
955 – 965.
62. Basu,Priya., & Pradeep Srivastava.( 2005). Micro finance and Rural Credit
Access for the poor in India. Economic and Political Weekly, April 23, 2005.
1747 – 1756
63. Akhter, Farida.(2006).Rural Development in the Era of Globalisatin:
Fragmented Realities .In M.C. Behra(Ed) Globalising Rural
Development(pp 101). New Delhi:Sage Publications.
64. Karnani, Aneel.(2007). Micro finance Misses its mark. Stanford Social
Innovation Review, 2007.pp36-37 www.ssireview.org
65. Dulal, Hari Bansha.,Chris D Gingrich.,& Roger R Stough.(2008). Do
Microfinance Programmes Really Save the Poor? Evidence from Rural
Southeast Nepal. Journal of South Asian Development, 3(2), 253-256.

45. 76
66. Anand,Jaya.S. (2005). Self Help Groups in empowering women. In Vinnetha
Menon,P.R.Gopinathan Nair and K.N.Nair(Eds.) Alleviating poverty,(pp 285-
309).Noida:Rainbow Publishers.
67. Makombe, Iddi. Eulalia Temba and Aggrey kihombo(2005).Micro credit and
women’s Empowerment: Evidence from the Credit scheme for Productive
Activities of women in Tanzania.In Vineetha Menon, P.R. Gopinath Nair and
K.N. Nair.(Eds.) Alleviating Poverty (pp233-251).Noida: Rainbow Publishers.
68. Murthy, Ranjani.K., K.Raju.,& Amitha Kamath.(2005).Towards women
empowerment and poverty reduction. In Neera Burra.Joy Deshmukh–
Ranadive, and Ranjani K.Murthy(Eds.) Micro credit, poverty and
Empowerment (pp 161-199).New Delhi:Sage Publications.
69. Malhottra,Anju.,& Sidney Ruth Schuler.( 2006).Women Empowerment as a
viable in the International Development. In Deepa Narayanan(Ed.) Measuring
Empowerment (pp71-88 ).Delhi: Oxford University Press.
70. Maggiano,Grey (2006).The impact of Rural Micro finance: measuring
Economic, social and spiritual development in KABALE, Uganda. Diss.
Georgetown Public Policy Institute, Washington, D.C.
71. Krishnnaraj, Maithreyi. (2007).Food security Agrarian crisis and Rural
livelihoods: Implication for women. In Maithreyi Krishnnaraj. (Ed.) Gender,
Food Security and Rural livelihoods (pp 24-72). Kolkata: STREE.
72. Sinha, Frances. (2007). Social performance in Indian micro finance .In Prabhu
Ghate(Ed.) Micro finance in India: A state of the sector report – 2007 (pp
113-114).New Delhi: Micro finance India.
73. Rajagopalan, M.R.(2007).Foreword. In Lalitha N. (Ed.) Grass Root
Enterpreneurship (pp vii-viii). New Delhi: Dominant Publishers and
Distributors.
74. Herms, Niels.,& Robert Lensik.(2007).Impact of micro finance: A critical
survey. Economic Political Weekly, XLII ( 6), 462 – 465.
75. Abdul Rahman, Abdul Aziz.(2002). Poverty alleviation through micro finance
in Malaysia : Potential and Constraints. Afro Asian Journal of Rural
Development. .XXXV(2), 7-26.
76. Vadivoo,Senthil. K.,& V.Sekar (2004)Self Help Groups – Movement for
women empowerment. Kissan world.31(7), 13-14.
77. Chethan, Vanitha and B. Krishnamurthy.(2004). Swarnajayanthi Grama
Swarozgar Yojana for empowerment of Rural women in Karnataka.In Kiran
Prasad(Ed.) Communication and Empowerment of Women vol.2 (pp558-591).
New Delhi: The Women Press.

46. 77
78. Ramanunny.M.(2005). Poverty Reduction through Micro Enterprise
development in Kerala,India. In Vineetha Menon,P.R.Gopinathan Nair and
K.N.Nair(Eds.) Alleviating Poverty. NOIDA:Rainbow Publishers.
79. Rao, M.V. (2005).Socio-Economic Development of Women: A case study of
Self Help Groups in Midnapore District. In Purnendu Sekhar Das (Ed.)
Decentralised Planning and Participating Rural Development (pp 155-172).
New Delhi: Concept Publishing Company.
80. Chaim,G.V.(2006).Impact of micro finance scheme. HRD Times. 8(10), 25-27.
81. Bhuvaneswaran V. (2006). Role of NGOs in Self Help Groups. HRD Times,
18, (12), 24-25.
82. Lalitha.N. (2007). Grass Root Entrepreneurship: Glimpses of Self Help
Groups. New Delhi: Dominant Publishers and Distributors, p.251.
83. Ahmad,Mokbul Morshed.(2006). The NGO Debate in Development:A review.
M.C.Behra(Ed.) Globalising rural development(pp183-203).NewDelhi:,Sage
Publications.
84. Ghate,Prabhu. (2007).Indian Microfinance: The challenges of rapid growth.
New Delhi: Sage publications.
85. Kumari,A., & N. Malathi (2009).Micro credit and rural development. In Anil
Kumar Thakur and Praveen Sharma(Ed) Micro Credit and Rural Development
(pp1-10.). New Delhi: Deep &Deep Publications.
86. Kallur.M.S. (2009).Micro credit through SHGs for promotion of Rural
Development in Karnataka: The present and the future. In Anil Kumar Thakur
and Praveen Sharma (Eds.) Micro Credit and Rural Development(pp64-
79).New Delhi: Deep &Deep Publications.
87. Swain, Bijay.(2009).Capacity building of SGHs through effective training.
Professional Banker,IX(1),52-56.
88. Suguna, B.(2006). Empowerment of Rural Women through Self Help Groups.
New Delhi:Discovery Publishing House.p85.
89. Joel.S.G.R.(2003) NGOs and Rural Development. New Delhi: Concept
Publishing Company. p 105.
90. Vats, Sarojini.(2004).Women’s Participation in Rural Development. New
Delhi: Abhijeet Publications. pp 130-131
91. Mishra, Dharmendra.(2005).Participatory Governance Through NGOs.
Jaipur: Aalekh Publishers. p.16.

47. 78
92. Basu, Priya., & Pradeep Srivastava.(2005).Exploring possibilities micro
finance and Rural credit Access for the poor in India. Economic and Political
Weekly. 40(17), 1747 – 1756.
93. Shylendra, H.S.(2007).Micro finance Bill : Missing the forest for the trees.
Economic and Political Weekly, XLII (27-28), 2910-2914.
94. Rahman,Muhammad Mahmudur.(2007).NGOs and Empowerment of women
in Rural Bangladesh. Prashasnika – A Journal of Administrative process.
Vol. XXXIV (2), 46-59.
95. Mayoux,Linda.(2007).Not only reaching, but also empowering women, ways
forward for the next micro finance Decade. ADA Dialogue. N 37,p 40.
96. Thirunarayanasamy.M., & S.Thirumaran (2007). Role of NGOs in Micro
financing. In Souvenir on National conference on sustainable rural
development through micro credit. Chidambaram.May 2007. pp19-20.
97. Ramachandran,S. (2007).Role of NGOs in micro finance. In Souvenir on
National Conference on Sustainable Rural Development Through Micro
Credit. Chidambaram. May 2007. pp38-39.
98. Laxmi.R.Kulashrestha., & Archana Gupta. (2005).NGOs in Micro-financing:
Partner in rural development. In S.B.Verma and Y.T.Pawar (Eds.) Rural
Empowerment through SHGs,NGOs and PRIs.( pp99-106).New Delhi: Deep
&Deep Publications.
99. Ghosh.D.K. (2005). Intervention in Poverty Alleviation-Scope and Reality. In
S.B.Verma and Y.T.Pawar (Eds.) Rural Empowerment through SHGs,NGOs
and PRI.( pp 107-119).New Delhi: Deep &Deep Publications.
100. Ahmad,Mokbul Morshed.(2006).The NGO Debate in Development:A review.
In M.C.Behra.(Ed.) Globalising rural development( pp183-203).New Delhi:
Sage Publications.
101. Sharma. R.K. (2006). Role of Administration in SRD Through Rural
Diversification: Emerging issues. In Surat Singh and Mohinder Singh.(Eds.)
Rural Development Administration in the 21st
century( pp113-120). New
Delhi: Deep & Deep Publications.
102. Muktasam A., & S.Chamala (2000).Rural Development Approaches in
Developing Countries.In R.K.samanta(Ed.) New Vista in Rural Development :
Strategies and Approaches (pp 221 – 258).New Delhi: B.R. Publishing
Corporation.
103. Bhowmick, Pradip. (1994). Rural and Tribal Development Practices in India.
New Delhi : M.D.Publications. pp 34-71.
104. Setty, E.D. (2002). New Approaches to Rural Development. New Delhi:
Anmol Publications, p332.

48. 79
105. Paul, Sujit Kumar & Kakali Paul (2003).Role of Panchayats and NGOs
Towards Sustainable Rural Development. Yojana 47(6), 19-22.
106. Hegde, Navayan.(2006).Management of Natural resources for Sustainable
Livelihood: BAIF’s Approach. In Y.P.Sing.(Ed.) Indian Village 2020( pp
371-382). New Delhi: Concept Publishing Company.
107. Kaul, K.K.(2004).Sustainable and meaningful Rural Development. J .of Rural
Tech. 1 (4), 68-173.
108. Maithai B.P.(2006). Administrative Arrangement for Rural Development. In
Surat Singh and Mohinder Singh (Eds.) Rural Development Administration in
the 21st
Century (pp163-175). New Delhi: Deep and Deep Publications.
109. Singh, Siva Raj.(2006). Rural Development Administration through Panchayat
Raj Institutions. In Surat Singh and Mohinder Singh (Eds.) Rural Development
Administration in the 21st
Century (pp420-426). New Delhi: Deep and Deep
Publications.
110. Reddy, Venkata. (2003).Sustainable Development: The Gandhian approach. In
Raghava Reddy, Subrahmanyam (Eds.) Dynamics of Sustainable Rural
Development (pp 89-103). New Delhi : Serials Publications.
111. Prahalad.C.K, (2008). Leap frogging the digital divide. Microfinance insights,
8, 12-15.