ABSTRACT
Micro finance through Self Help Group (SHG) has been recognized internationally as the modern tool to combat poverty and for rural development. Micro finance and SHGs are effective in reducing poverty, empowering women and creating awareness which finally results in sustainable development of the nation. Micro finance define as efforts to improve poor people's access to loans and saving services may be the fastest growing and most widely recognized anti-poverty too. Micro finance includes basic financial services including small loans, savings accounts, funds transfers and insurance. A long side non-financial service such as business training Micro finance assists people living in poverty who wouldn't usually qualify for regular banking services because they have no form of collateral or formal identification. An attempt is made here to examine the impact of the microfinance on the development of the Self-Help Groups in India. The total number of self-help groups which have maintained savings with banks is 100 lakhs during 2018-19 but only 26.98 lakhs i.e 26.95 percent of the SHGs have obtained credit from the financial institutions. Out of 74.62 lakh SHGs, only 11.96 lakhs i.e. 16.03 percent of the SHGs have got micro-credit from the institutional credit agencies during 2010-11. The above analysis indicates that the number of SHGs which got micro credit has increased from 16 percent to 27 percent i.e only 11 percentage points increased in 2018-19 over 2010-11. About 73 percent of the SHGs are out of the purview of the public financial institutions. Majority of the women members of SHGs are away from the institutional credit agencies. These marginalized women have to depend on informal financial services for their credit needs. So that the financial informal sector (mostly moneylenders)has continued to rule in the rural economy. There is a need to break the monopoly of door step availability of credit to these marginalized sections by the informal sources of credit. The credit needs of the women members have enormously increasing for the last two decades. The average loan disbursement per SHG has increased from Rs.1.22 lakhs during 2010-11 to Rs.2.16 lakhs during 2018-19. This is inadequate to meet the credit requirements of the members in the SHGs. Hence it should be made four to five times of the micro credit per SHGs. The bank loans are not regularly paid by the members of the SHGs. Hence, the amount of loan outstanding has continuously increased since 2010-11. It is evident from the fact that the average outstanding bank loans against SHGs shows higher level. The average outstanding per SHG has increased from Rs.65, 224 during 2010-11 to Rs.171543 during 2018-19, shows two and half-fold increase. As a result of it the overall NPA rate in bank loan to SHGs is steadily increasing since 1910-11. However, the overall NPA rate in bank loan to SHG is 5.19 percent as on 31-03-2019 registering a fall of 93 basis points from the previous level of 6.12 percent. The above analysis reveals that the steady declining the rate of NPA is indicating the recovery of loans made of SHGs is improving during the last few years.