BANKING AFFAIRS

Detailed explanation-1: -What are SHGs? Self-Help Groups are informal associations of people who choose to come together to find ways to improve their living conditions. They help to build Social Capital among the poor, especially women. to act as a conduit for formal banking services to reach them.

Detailed explanation-2: -SHGs were created for providing financial access and gradually metamorphosed into the world’s largest microfinance program, where multiple agencies, NGOs, governments, banks work in unison. The first SHG was linked by Bangarpet Branch of Vysya Bank in Kolar district, Karnataka.

Detailed explanation-3: -A SHG is a group of about 10 to 20 people, usually women, from a similar class and region, who come together to form savings and credit organization. They pooled financial resources to make small interest bearing loans to their members. This process creates an ethic that focuses on savings first.

Detailed explanation-4: -essential difference between these groups and SHGs is that in the SHG model, the loan is a single loan to the group as a whole, whereas the MFI tracks loans in the name of individual borrowers. to teach the poor people to fish when they cannot reach the river. their essential needs.