‘They ask us for land documents as collateral, but we have no assets or land’
Several thousands women Self Help Groups have disintegrated or become defunct over the years in the state. Officials from the Tamil Nadu Corporation for Development of Women (TNCDW) claim that delay in loans from local banks and debts with micro finance institutions are the reasons behind this failure.
According to data received from TNCDW, out the 3.2 lakh groups in the State which are under its fold , 58,000 have disintegrated and 14,380 have become defunct, so far.
Earlier, the Self Help Group (SHG) programme was implemented under the Mahalir Thittam Scheme, which is now being rooted through the Tamil Nadu State Rural Livelihoods Mission, started in 2012. The aim of the project is to reduce poverty and promote livelihoods in rural areas by including women in the SHG network while providing bank linkages to take up income generating activities for their socio-economic empowerment.
“Banks in rural districts target big players and these groups are ignored. The long delays in application processes also make them take loans at huge interest rates from microfinance institutions, landing them in debts. They eventually disintegrate,” the official said.
A study by Social Watch – Tamil Nadu, pointed out a large number of SHGs which are becoming defunct or weak comprised primarily of Dalit women. These women reportedly have had greater difficulty in accessing credit from banks or other financial institutions.
Kasthuri a former member of Annai Theresa SHG in Pumbur village, Villupuram, hails from a Dalit family and alleged that the constant unwillingness of local banks to sanction loans resulted in their group becoming defunct. “They ask us for land documents as collateral. But we have no assets or land,” she said.
However, local bank managers from Villupuram said that it was due to previous experiences of loan repayment defaults by SHGs which deterred them from issuing new ones. Out of the 30 Dalit women interviewed in Villupuram and Cuddalore districts at least 22 claimed to have not benefited from SHGs unless supported by extra enabling mechanisms.
Most women said, they were not able to create any assets for themselves out of the loans or groups nor have they experienced any significant progress in their socio-economic status. “The maximum we have been able to do is fund our children’s education, the rest remains the same,” said Kasthuri.
Kamakshi Sundaramurthy, Senior Researcher, Social Watch – Tamil Nadu, said the State must tap resources of agencies such as TAHDCO (Tamil Nadu Adi Dravidar Housing and Development Corporation), Scheduled Castes Finance and Development Corporations to provide loans to marginalised communities. “They must disaggregate data regarding the number and statuses of women groups according to their communities, exclusively, to ensure its effective functioning and utilisation of funds,” she said.
It was during the tenure of former TN Chief Minister J. Jayalalithaa that the SHG movement gained momentum in the State. It aimed to empower women from all strata by providing livelihood opportunities, however, over the years as Ms. Kandimathi, Director and Researcher, Law Trust, claims the concept has deteriorated. “Many people and political parties today see SHG as a money making mechanism. They set up fake organisations to make profits. We need rights-based initiatives and the real concept of SHGs must be internalised to help revive it,” she said.
Bringing in more banks
TNCDW has now kick-started its project to regroup SHGs across districts, including those who have disintegrated or show such signs. To help the SHGs avail loans easily, TNCDW is also planning to tie up with more District Cooperative Central Banks and Primary Agricultural Credit Societies and help set them up in rural districts.
“We are also working on providing them an online database with details of all members of SHGs in respective districts, so that the branch officers are in ease while lending loans to the groups,” the official said.