A SHG developing a community forest

Chirag promotes the formation of community-based institutions and supports their functioning in a variety of ways. A large number of these (approximately 220) are self-help groups (SHGs) whose purpose is to pool financial resources through small monthly contributions and serve as a support group for members. This encourages savings and gives members access to sums of money that would enable a diversifying of livelihood options. In the Dewaldhar area the formation of SHGs has been boosted by our partnership with Aajeevika – a livelihood program that is an initiative of the Government of Uttarakhand.
We organize families into SHGs, to discuss, monitor and evaluate their functioning, and to help them liaise with banks and government departments. We have also provided them modest grants to cover recurring expenditure, though this is planned to be discontinued. We believe it important for the SHGs to be self-sustaining.

One specific concern is for interest rates to be lowered so that people feel encouraged to take loans. Over the years there has indeed been a downward revision in rates though there is much regional variation in this regard (6 – 24% per annum). There is also regional variation in the purposes for which loans have been taken. They range from traditional and non-traditional income generators (agriculture, animal husbandry, horticulture, culinary herbs, candle making) to miscellaneous personal expenditure (in health and education, for instance). The latter is more prevalent in the poorer SHGs, a significant number of which fall in the Dewaldhar area.

To encourage women to become more financially independent, Chriag has promoted the Uttaranchal Sangharsh Mahila Sangh, a federation of exclusively women’s SHGs. A recent initiative has seen the setting up of SHGs by adolescent girls.

Chirag’s work in helping communities to raise their own funds for development is allied to the work of strengthening village level institutions more generally, for instance in areas like forests (through Van Panchayats and users’ groups), marketing, livestock, health, education and cleaning of the environment.