'Microfinance Bill impediment for self-help groups'

The Microfinance Bill in its present form may hurt the growth of the Self-Help Group (SHG) programme being run across states to bring people above the poverty line, according to Union rural development minister Jairam Ramesh.

“The Bill needs to be rewritten. MFIs are not instruments for poverty alleviation,” Ramesh said in an interaction with reporters after he reviewed initiatives by NABARD in an SHG-bank link programme.

He, however, did not elaborate the kind of changes necessary in the Bill before the Parliament. At present, there are 1.34 million active SHGs in the country. Most of them are concentrated in southern states. Andhra Pradesh alone has 0.71 million SHGs in 16 districts.

 

During the visit, Ramesh launched a dedicated ‘Ajeevika’ Cell at the headquarters of NABARD (National Bank for Agriculture and Rural Development). The programme aims at alleviating poverty in rural areas by providing poor women better access to financial resources at affordable rates and facilitating the establishment of sustainable livelihoods.

It will attempt to address supply and demand side constraints, besides bridging capacity gaps for poor communities to strengthen the existing livelihood sectors like agriculture and allied activities.