describe any three advantage of self help group for the poor
Answers
Answer:
SHG'S helps the borrower to overcome the problem of lack of collateral .
They can get timely loans for a variety of purposes and at a reasonable rate .
SHG'S are building blocks of organisation of the rural poor .
SHGs play a critical role in providing impoverished people with access to finance, which is critical for poverty alleviation. SHGs also play an important role in women's empowerment since they help women from economically disadvantaged backgrounds establish social capital.
Explanation:Self Help Group (SHG) is a group of about 15-20
members who pool their savings together.
Following are the advantages of SHG:
1. Members can take out loans from the group's savings at a predetermined interest rate.
The rate of interest is far lower than that charged by informal sources.
2. After two years of consistent savings, the SHG can apply for a bank loan. The loan is made in the name of the organization and provides the members with numerous alternatives for self-employment.
3. Because of SHG, poor members can get a loan even if they don't have any collateral.
4. Many women have become monetarily self-sufficient as members of SHGs. This has resulted in women's empowerment in rural areas.