Can the vicious cycle of gender inequality, poverty and malnutrition be broken through microfinancing of women SHGs? Explain with examples.

low income --> less investment on health & education less investment on health & education --> less earning potential of next generation less earning potential of next generation --> Poverty

Box: Vicious cycle

SHGs as powerful tool to break cycle

(1) SHGs engage in asset creation which lead to rise in income.

Ex: Lijjat Papad (SHG) employs 45000 women and has turnover of 1600 cr annually.

(2) Key tool for women empowerment and financial independence of women. Ex: Nabard survey: 90% of SHG members are women.

(3) Better investment in health and education of children by SHG women -> reduce inter-generational poverty.

(4) Tool for skilling and training for women.

(5) Promotes culture of savings & financial inclusion.

Success Case Studies: (1) Kudumbshree (Kerala) neighbourhood SHGs, led to elimination of absolute poverty. (2) Mission Shakti, Odisha led to 60 lakh women brought out of poverty.

diagram But SHGs face challenges like:

1. market access is limited
2. limited avenues of training and skilling
3. tough competition from machine made products
4. Social barriers of caste, patriarchy, etc.
5. costly credit

Steps needed (1) make available cheap credit. Ex: Pavli Vadha (AP) scheme gives loan at 0.25% interest. (2) Rajeevika (RJ) provides skilling to SHG women nearby rural areas. (3) e-commerce marketing. Ex: Mahila e-haat, Saras collection.