Understanding Impact of Microcredit on Enterprises Being Run by Women Self-Help Groups (SHGs)

Abstract

Microcredit is defined as minor finances given to lesser earning persons who are away from the conventional banking structure. Microcredit is a portion of the big microfinance institution that provides credit, along with savings, insurance, and additional elementary financial facilities to the poor. Different forms of microcredit services, from ancient time, are found in India e.g. moneylenders, community lending, loans from friends and relatives, traditional informal groups, conventional or specialized banks microcredit etc. The desire and intrinsic competence of poor to get better living standard is intended as the base for concept of ‘microcredit’. After the success of microcredit in Bangladesh, it is recognized as an efficient tool for empowerment of economically deprived section of the society. Generally, the receiver of microcredit is both the urban and rural families, particularly women SHGs. Credit is given for improving standard of living, asset making and revenue-generating activities. Government Departments, Micro Finance Institutions (MFIs), Self-Help Groups (SHGs), Non-Government Organizations (NGOs) independently recognize the beneficiaries. The repayment period is usually small. The distinctive benefits are high rate of repayments of credits and low transaction cost. Lately, microcredit turned into well-known organised livelihood for monetary services especially for the economically weaker section. Microcredit is now established as an unconstrained economic system with numerous variants in MFIs structure. This Study is an attempt to understand the impact of microcredit facility on enterprises being run by SHGs in rural and suburban areas.