Question

How the Self Help Groups (SHGs) of the problem of lack of collateral?​

Answer 1

Answer:

The SHGs solve their problem of collateral by taking amount from individuals (amount may be varying from rs 25 ti 100)

And thus solve the problem of lack of collateral.

Answer 2

Answer:

SHGs help borrowers to overcome the problem of lack of collateral in the following ways:

• It is the group that is responsible for the repayment of loan.

• Any case of non-payment of loan by any member is followed up seriously by other members.

• The formal sector is willing to lend to the members of SHGs because of their good track record of managing the credit.