SHG Loan
A Self-Help Group (SHG) loan is a form of microfinance aimed at empowering individuals, especially women, in low-income communities. Here's a detailed description:
1. *Formation*: SHGs are typically small groups of 10 to 20 individuals from similar socio-economic backgrounds who come together voluntarily to form a group. These groups are usually facilitated by NGOs, banks, or government agencies.
2. *Objective*: The primary goal of SHGs is to promote savings, entrepreneurship, and self-reliance among members, particularly women, by providing access to financial services and resources.
3. *Group Dynamics*: Members of SHGs meet regularly to save small amounts of money, which collectively form a pool of funds. They also discuss various issues related to finance, livelihoods, and community development.
4. *Credit Access*: Once the group has accumulated a certain amount of savings, they can avail loans from banks or other financial institutions. These loans are usually collateral-free and have low-interest rates.
5. *Loan Utilization*: SHG loans can be used for various purposes such as starting or expanding small businesses, investing in agriculture, education, healthcare, or meeting emergency needs.
6. *Repayment*: The group members collectively decide the terms of repayment, including the interest rate and the repayment period. Loans are repaid in installments, usually on a weekly or monthly basis, during the group meetings.
7. *Impact*: SHG loans have been successful in promoting financial inclusion, poverty alleviation, and women's empowerment in many parts of the world. They not only provide access to finance but also build financial literacy, social capital, and leadership skills among members.
Overall, SHG loans serve as a vital tool for socio-economic development, particularly in rural and marginalized communities, by fostering self-reliance and entrepreneurship.
Giving SHG Loan based on their Deposit
SHG Loan intrest rates @ 12%