Consider the following statements:
1. The Self-Help Group (SHG) programme was originally initiated by the State Bank of India by providing microcredit to the financially deprived.
2. In an SHG, all members of a group take responsibility for a loan that an individual member takes.
3. The Regional Rural Banks and Scheduled Commercial Banks support SHGs.
How many of the above statements are correct?
Only one
Only two
All three
None
Answer is Right!
Answer is Wrong!
This question was previously asked in
UPSC IAS – 2023
– Statement 2 is correct. A core principle of SHGs is collective responsibility or joint liability. Members guarantee each other’s loans, which encourages timely repayment and peer pressure.
– Statement 3 is correct. The SHG-Bank Linkage Programme is implemented by commercial banks (including Scheduled Commercial Banks), Regional Rural Banks (RRBs), and Cooperative Banks, linking SHGs to formal financial institutions.