Self-help groups’ credit share up in north, east

India’s northern and eastern states are slowly but steadily increasing their share of bank credit for women self-help groups (SHGs), a sector traditionally dominated by five southern states, indicating a new momentum in the country’s rural economy.

In the last four years, there was a 28 percentage-point rise in the share of banks loans for northern and eastern states as the government backed rural livelihood projects to create alternative sources of income in farming communities. Bank credit acts as the lifeline for India’s 3.8 million SHGs that come under the National Rural Livelihood Mission (NRLM). Poor rural women form 2013-14 2014-15

2015-16 2016-17

these groups to launch a number of businesses, such as poultries, dairies, fisheries, seed banks, pottery units, canteens and food processing units.

The Centre supports these activities through an interest subvention scheme that allows SHGs to acquire loans at 7% annual interest. In 250 districts, the government offers an additional rise in share of banks loans for northern, eastern states

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Women self-help groups in India

subvention of 3% on early payments. As many as 216 of these districts fall outside southern India.

Vijay Mahajan, CEO of the BASIX Social Enterprise Group, said: “The central, north and eastern regions have always been laggards when it comes to financial inclusion schemes. But