3.4. A feature that is common to all Government. anti poverty programmes which provide an asset to the beneficiary is the criteria that comes along with the scheme to identify the beneficiary. When the scheme was targeted to individuals this method of targetting did not meet with any obstacle; but of late Government. has adopted the "group approach"; all the eligible beneficiaries are therefore required to form groups which are then conveniently called self help groups. MYRADA calls these groups: Groups of "eligible beneficiaries",. This strategy to link the direct targetting on the basis of predetermined criteria with group formation creates several problems when the NGO insists that the groups must be genuine "affinity groups". In the IFAD project in Tamilnadu several groups were formed of "eligible" beneficiaries; the criteria for eligibility was set by Government and covered age (17 years), gender (women) and previous performance in repaying loans from Banks.. The Banks went a step further and considered women un-eligible if their fathers, brothers or husbands had defaulted. MYRADA, however formed groups on the basis of affinity. Several of the members of these groups were not eligible according to the Bank's norms. As a result, in order to target 10,000 beneficiaries in the District as planned under the IFAD project over 20,000 members had to be organised into SHGs. This was  considered to be a waste of time and effort by Government. officials ;it also called for extra staff and resulted in the failure to meet with annual beneficiary targets. Therefore, the solution imposed was to organise groups of only "eligible" women. A similar situation arises in PLAN projects where families become eligible on the basis of a child suitable for sponsorship; these families are then formed into a group. Members of groups formed in this manner remained in the group only because they considered that their membership was a pre condition to get some money from the Banks and from Government. As soon as loans were extended many groups tended to disintegrate; this in turn increased the work of the NGOs concerned who had to put in considerable effort to organise meetings and motivate repayments. Briefly it was the NGO that managed the groups. If , on the contrary, the groups are genuine SHGs they will function not because the members have joined a group as a condition to receive loans but because women have taken the initiative to build an institution on the basis of their own efforts. In a genuine SHG, the group continues to grow and function even after the project period is over. If groups are to sustain their efforts, they need to be affinity groups as well as small and homogeneous; besides, they must have the freedom to develop their own rules and regulations and to include and exclude members according to norms which they lay down. Women who are brought together because they are eligible for loans perceive the formation of a group as a precondition to receiving loans; seldom do they go any further either in terms of increasing self confidence or empowerment in social and private life.

PART II

The process of SHG formation has features which could be separated into three phases for the sake of clarity. Who intervenes in each phase, how, and where, are questions which do not elicit answers which are common to all project areas; they cannot be standardised. A few guidelines, however, are useful, together with a few indicators regarding the features of the SHGs at the end of each phase which will help to provide a backdrop against which their progress can be assessed.

Phase I - Identification and Formation of SHGs : 0 - 4 months

This is a critical function on which depends all further progress of the group. MYRADA staff with experience in these areas have to take the lead in identifying an affinity group which develops into an SHG; inexperienced staff will not be equipped to perform the role of group identification. Care should be taken to ensure that MYRADA places experienced staff at middle management level to play a key role during this phase.

Identification and formation of SHGs involves collection of information regarding credit needs, incomes and their seasonality, the availability of natural resources, skills and markets, people's perceptions of poverty and of intervenors, and the identification of social groupings in society. Participatory Rural Appraisal methods have been useful in this area. The people are involved in collecting and correcting data in a manner in which all can participate using instruments to which they are accustomed like sticks, stones, seeds and coloured powders.

During this phase, if the SHGs are entirely composed by women, it has been found necessary to meet with men and to explain what is going on, especially the benefits that will accrue to the family through SHGs.

Group formation is not complete with the first meeting. It takes several meetings over a period of 2 to 4 months for the group to have definite membership. During this period members may leave and others may join if the group agrees.

The meetings held during this period are not only social gatherings; the members also raise issues concerning the family and the village. Matters regarding savings and lending are also debated thoroughly as this is the major common function of the group. Agreement to save and to lend and the willingness to abide by group decisions without breaking bonds and confidence in the group indicate a degree of trust in one another; these are the building blocks of effective SHGs.

Critical Features of the SHG at the End of Phase I

The group is identifiable; it is not a place where people can walk in and out at will. The members have agreed to save regularly, to create a habit of thrift and to establish a culture of self help. Some groups may have started savings. Basic records like (i) Attendance Register; (ii) Minutes Book; and (iii) Members Savings Ledgers and Individual Savings Pass books -if savings have started - should be maintained.

The date, time and place of meetings must be decided on by the members and meetings held regularly according to the schedule. Two members of the group should be elected/selected who function as chairman and secretary. Many groups prefer to call them representatives since the titles of Chairman and Secretary tend to be interpreted as positions of power. The groups are encouraged by the intervenors to change the representatives every year and to elect/select the following year's representatives six months in advance so that they can be adequately prepared and trained. The group has given itself a name. If savings have begun, the group opens an account in the nearest Bank or Post Office. The account has two signatories, either one from the SHG and the other from the NGO intervenor or both from the SHG.

MYRADA continues to play a key role in this phase as well; our staff attend all meetings and ensure that adequate support is provided so that:

- Savings are regular and lending operations gather strength. This provides the members of the SHG with an opportunity to acquire the skills to manage its resources. The group decides on the rate of savings, on the timing of the loans, on the schedule of payments and repayments, and on the interest rates; it assesses when and whether the member needs a loan and whether she/he is able to use the loan effectively and to repay according to the schedule decided on.

- Meetings are held regularly, preferably every week; attendance is maintained and averages over 80% and repayments over 90%; sanctions for default on repayment and for deviant behaviour (smoking at meetings, arriving late for meetings, etc.) are imposed and accepted.

- The following books are maintained either by a literate member of the group or by the NGO staff or preferably by someone from the village who is paid for such services. (Admission Book, Attendance Register, Minutes Book, Members Savings Ledger, Members Pass Book, Receipt Voucher, Payment Voucher, Cash Book, General Ledger, Loan Ledger, Stock Book.)

- Gender issues concerning women in private and public life are raised and discussed.

- Literacy and numeracy classes are conducted and attended by all members.

- Common Action programmes are organised by the group.

- They begin to interact with other groups, Government and private institutions.

Group training is held regularly - at least 3 modules each of 2 days - during this phase to enable all to participate effectively, especially the weaker members (in some cases special modules may have to be conducted for them), to build group culture and to raise the level of commitment to mutual support and acceptance of group decisions, to develop self confidence in private and public life, to help members acquire the skills of conflict resolution, etc.

Training of SHG Representatives : The two representatives who have been elected need to be trained to conduct meetings, to help the group to establish a supportive culture, to establish priorities in lending, and to impose and accept sanctions. They need to equip themselves with the skills of numeracy and literacy to enable them to keep a check on what is recorded in the Minutes and pass books. They need to develop leadership qualities and the confidence to relate with institutions like Government Departments and Banks as well as to provide leadership in organising common action programmes. It is important that the group selects/elects the representatives for the following year at least six months in advance to enable them to build up these skills and confidence. If the group representatives are not changed every year, there is a danger that power will accumulate in the hands of a few which will in turn prevent the effective participation of all members. Rotation of representatives provides all the members with an opportunity to acquire the skills of group leadership. Once the first set of representatives have handed over responsibilities they could play the role of group animators, after the groups have been in operation for 12 - 15 months, provided they have had at least 3-4 modules of training and exposure to operating SHGs.

Experience in several MYRADA projects proves that there is no need to have animators at the village level. The responsibilities of conducting a group meeting, relating with the banks and with MYRADA can be carried out by the group representatives provided they receive training. Other group maintenance activities like keeping of accounts and records can be done by local people who are paid by the group on a job-by-job basis. The funds can come initially from MYRADA, but the group should select the person and fix the amount; it should be made clear to the group from the very beginning that MYRADA will only reimburse this amount for a period of 1-1/2 to 2 years.

Training of bare foot specialists in animal husbandry, agriculture and horticulture should be carried out intensively by MYRADA's Subject Matter Specialists or by contract services during Phase II. This will build up a cadre of field technicians. Training in animal care and breeding should also be given to women who own and manage animals.

Common Action : One or two small common action programmes in the village are planned and implemented preferably in collaboration with other SHGs if they exist in the village.

Gender Issues : Gender issues concerning women and the girl child are raised at meetings and form an important part of training. Men are invited to participate in common action programmes and occasionally to SHG meetings.

Negative reactions from men to women's absence from home when they attend meetings or are involved in common action or even to the increasing presence and profile of women in public life is a common feature during this period. MYRADA has to play a direct role to cope with this problem, even offering counselling services at the family level when the problem threatens to escalate.

Support to the Common Fund of the SHG : After 6 - 9 months, if the SHG is progressing according to the indicators mentioned above, grants in installments matching the savings or in a higher ratio depending on the performance of the group are credited directly to the common fund. This helps to build up available capital, enabling members to access larger loans for business, trading and other small income generating activities.

All the members are engaged in savings. Loans are provided to all. All transactions are supported with documentation; a summary of loans and recoveries is posted in a public place and regularly updated. The common fund is steadily increasing through interest, savings and fund raising by the group. The common fund is revolving; bank balance is low or nil. The recovery rate is consistently over 90%; attendance is consistently over 80%. The members have acquired the skills to conduct meetings and to resolve conflicts; perhaps, they have acquired skills in literacy and numeracy as well. Their confidence to act in public life has increased; they are able to relate with other institutions and Government as a group. Initial steps are taken to relate with the Bank and to negotiate a loan to the group. The group has the experience of organising and being involved in one or two common action programmes and in conflict resolution. The members of women groups have begun to address gender issues and to take small though significant actions both in public and at home.

To summarise : in Phase II, MYRADA plays a key role in training of groups and group representatives, as well as in gender sensitisation. However, MYRADA moves away from direct intervention, to support the process of group growth by attending all meetings of SHGs and intervening when required. The Subject Matter Specialists play a direct role in  training asset owners and village technicians.

Though intervenors need to integrate withdrawal in their strategy from the beginning of the process in order that interventions will support the growth of self reliant people's institutions and not increase their dependency, yet withdrawal becomes more tangible and acceptable after the major interventions required to build up the groups taper off.

MYRADA expects withdrawal to be visible 15 months after the groups exhibit the features listed at the end of Phase II, which is about 15 to 20 months after the groups are identified. As the groups take on the major role in organisational maintenance, the intervenors gradually withdraw. To begin with, the intervenors reduce their attendance at weekly group meetings. Next the groups begin to pay for those maintenance services which they require. For example, a group would pay one person for writing the Minutes and for keeping accounts. MYRADA would still have to provide the services of its accountants for an annual audit, towards which service the group should be asked to contribute until it is capable of hiring these services on its own. The NGO also responds to requests to intervene in the event of a crisis situation which the group on its own cannot resolve.

Major interventions during this period would be technical services for asset management and productivity, all round support for off-farm activities, especially for design, quality and marketing. These services could be provided partly by trained local bare foot specialists as in the case of animal husbandry, agriculture, sericulture and horticulture (for whose services the members of the group have capacity to pay either from their savings or by taking loans from the group) and partly by MYRADA staff or consultants.

During this period MYRADA and the SHGs could also foster the emergence of apex bodies but the need for such bodies and their functions should be decided by the group. Experience with apex bodies has also shown that they are vulnerable to political influences or are used as steps towards political positions. Politicisation of apex bodies weakens and eventually destroys the self help groups. Care should be taken that the groups are strong enough to control the functioning of the Apex bodies before they are formed. In some projects, groups have restricted the roles of apex bodies to supervising the groups and to assist in problem solving; they have refused to give apex bodies any funds or the power to control resources. Where the Apex bodies have funds, care should be taken to audit them regularly.

During this period the supportive role of MYRADA decreases. We need, however, to ensure that regular feedback and analysis of data is available in order to identify trends in financial management of the SHGs. The guidelines given in the "Blue Book" relating to the management of savings, the group's common fund, loans, book-keeping and audit help to identify important indicators of the SHGs' performance and should be applied regularly to groups in all MYRADA projects in order to assess over all performance of each group and to focus on those that are weak.

(1)  As distinct from "entrepreneurial" which implies a strong element of competition.