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Consider the following statements
1. Members can take small loans from the group itself to meet their needs
2. The group charges interest on these loans but this is still less than what the moneylender charges
3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the members
Which of these statements are correct about Self Help Groups?
- a)1 Only
- b)2 Only
- c)3 Only
- d)1 and 2 Only
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements1. Members can take small loans from...
- The idea is to organise rural poor, in particular women, into small Self Help Groups (SHGs) and pool (collect) their savings. A typical SHG has 15-20 members, usually belonging to one neighbourhood, who meet and save regularly.
- Saving per member varies from Rs 25 to Rs 100 or more, depending on the ability of the people to save. Members can take small loans from the group itself to meet their needs. The group charges interest on these loans but this is still less than what the moneylender charges.
- After a year or two, if the group is regular in savings, it becomes eligible for availing loan from the bank. Loan is sanctioned in the name of the group and is meant to create self- employment opportunities for the members.
- For instance, small loans are provided to the members for releasing mortgaged land, for meeting working capital needs (e.g. buying seeds, fertilisers, raw materials like bamboo and cloth), for housing materials, for acquiring assets like sewing machines, handlooms, cattle, etc. Most of the important decisions regarding the savings and loan activities are taken by the group members
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Consider the following statements1. Members can take small loans from...
Introduction:
Self Help Groups (SHGs) are community-based organizations that consist of a small group of individuals who come together to address their common social and economic needs. These groups aim to empower their members through various activities, including providing financial assistance in the form of small loans. Let us analyze the given statements to determine which ones are correct about Self Help Groups.
Statement 1: Members can take small loans from the group itself to meet their needs.
This statement is correct. One of the primary objectives of Self Help Groups is to provide financial assistance to their members. Members can avail small loans from the group to meet their immediate financial requirements. These loans are generally provided at a reasonable rate of interest.
Statement 2: The group charges interest on these loans but this is still less than what the moneylender charges.
This statement is also correct. Self Help Groups charge a nominal rate of interest on the loans provided to their members. The interest rate charged by SHGs is usually lower than what moneylenders or other financial institutions charge. This helps in reducing the financial burden on the members and promotes financial inclusion.
Statement 3: Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the members.
This statement is correct. When a loan is sanctioned by a Self Help Group, it is done in the name of the particular member who requires the funds. This ensures that the loan is used for the intended purpose, which is to create self-employment opportunities for the members. The loans are primarily given for income-generating activities like starting a small business, agriculture, or other livelihood-related ventures.
Conclusion:
In conclusion, all the given statements about Self Help Groups are correct. Members can avail small loans from the group itself, which are provided at a lower rate of interest compared to moneylenders. These loans are sanctioned in the name of the particular member and are meant to create self-employment opportunities. Self Help Groups play a crucial role in promoting financial inclusion and empowering individuals at the grassroots level.
Self Help Groups (SHGs) are community-based organizations that consist of a small group of individuals who come together to address their common social and economic needs. These groups aim to empower their members through various activities, including providing financial assistance in the form of small loans. Let us analyze the given statements to determine which ones are correct about Self Help Groups.
Statement 1: Members can take small loans from the group itself to meet their needs.
This statement is correct. One of the primary objectives of Self Help Groups is to provide financial assistance to their members. Members can avail small loans from the group to meet their immediate financial requirements. These loans are generally provided at a reasonable rate of interest.
Statement 2: The group charges interest on these loans but this is still less than what the moneylender charges.
This statement is also correct. Self Help Groups charge a nominal rate of interest on the loans provided to their members. The interest rate charged by SHGs is usually lower than what moneylenders or other financial institutions charge. This helps in reducing the financial burden on the members and promotes financial inclusion.
Statement 3: Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the members.
This statement is correct. When a loan is sanctioned by a Self Help Group, it is done in the name of the particular member who requires the funds. This ensures that the loan is used for the intended purpose, which is to create self-employment opportunities for the members. The loans are primarily given for income-generating activities like starting a small business, agriculture, or other livelihood-related ventures.
Conclusion:
In conclusion, all the given statements about Self Help Groups are correct. Members can avail small loans from the group itself, which are provided at a lower rate of interest compared to moneylenders. These loans are sanctioned in the name of the particular member and are meant to create self-employment opportunities. Self Help Groups play a crucial role in promoting financial inclusion and empowering individuals at the grassroots level.
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Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer?
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Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer?.
Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements1. Members can take small loans from the group itself to meet their needs2. The group charges interest on these loans but this is still less than what the moneylender charges3. Loan is sanctioned in the name of the particular member and is meant to create self-employment opportunities for the membersWhich of these statements are correct about Self Help Groups?a) 1 Onlyb) 2 Onlyc) 3 Onlyd) 1 and 2 OnlyCorrect answer is option 'D'. Can you explain this answer?.
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