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NATIONAL WORKSHOP ON SHG FEDERATIONS. SYNTHESIS. National Workshop Objectives. Critical review of experiences in promoting SHG Federations across India.

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National workshop on shg federations



National Workshop Synthesis

National workshop objectives
National Workshop Objectives

  • Critical review of experiences in promoting SHG Federations across India.

  • Draw conclusions and make recommendations (“best practice”) to promote sustainable member-designed, member-owned and member-managed SHG Federations

National Workshop Synthesis

Inaugural session
Inaugural Session

  • Collaborative effort to organize the National Workshop appreciated by all the speakers.

  • Shashi did a great job in raising the issues. All the speakers highly appreciated the issues raised in the discussion paper

  • The National Workshop is timely and hopeful that the conclusions and recommendations will provide direction to all SHPIs in the country.

  • Government of AP is with a open mind on issues related to why, what, where, when & how of federations.

  • To find answers to the issues raised in the paper, a mechanism need to be set up to work beyond the two-day workshop.

  • Promotion of Federations should be a process-oriented approach, based on the felt need and should be a value add tier, without duplicating or competing with their primaries.

National Workshop Synthesis

Discussion paper presentation by ms shashi rajagopalan
Discussion Paper Presentation by Ms. Shashi Rajagopalan

Federations are useful only to the extent that they service the ultimate member

National Workshop Synthesis

Discussion paper presentation
Discussion Paper Presentation

  • Federations are necessary, if they add value and not compete/conflict with SHGs.

  • Protect savings of women members.

  • Feds for audit, supervision, training, insurance, policy framing – benefit all the members.

  • Feds after strong primaries are in place.

  • Need to build members stake in the institution.

  • Feds’ survival to be dependent on member service fees.

  • Institutions of the poor many not be able to manage efficiently several agendas (financial & non-financial)

  • Leadership is critical for the effectiveness & sustainability.

  • Accounting systems are critical (bookkeeping & MIS).

  • Training of Board & ensuring reward & punishment exist.

  • SHPIs: Competence, costs, enabling, positioning and replication

National Workshop Synthesis

Sa dhan shg federation study findings by achala of sa dhan new delhi
Sa-Dhan SHG Federation Study Findings by Achala of Sa-Dhan, New Delhi

  • Covered 27 Feds. (organizations) across India.

  • Dilemma in balancing financial & social – financial needs stricter & system oriented, social – flexible.

  • 3-tier Feds most common, 5-tier also exist.

  • External locus Feds: financial & large outreach.

  • Federations with finance & internal locus – need significant CB.

  • Finance plus & internal locus – significant CB – can develop into true institutions of the poor.

  • Non-financial federations are likely to take up financial services.

  • SHG members are able to relate to Federations closer to them.

  • Capacity & role of Promoting Institution is critical.

  • Costs of facilitating SHG Federations is massive – need funds.

  • Banks should lend to SHG Federations.

National Workshop Synthesis

Theme i process of promoting federations

Theme I: Process of Promoting Federations


Dr. Shankar Datta, IGS of BASIX, Hyd

Mrs. Vijayalakshmi Das, FWWB, Ahemdabad

National Workshop Synthesis

National workshop on shg federations

SHG Federation

Village Organisation

Village Organisation








VELUGU – A unique initiative

Key Processes

  • Institution Building

Project design emerged drawing lessons from all existing anti-poverty programs

  • Social Capital(developing community activists and bare-foot professionals responsible to the community)

  • Livelihood Expansion

    Increase in incomes and employment, decrease in expenditure, costs and risks

National Workshop Synthesis

Velugu project govt of ap by mr vengal reddy pd of rr dist
Velugu Project – Govt. of AP by Mr. Vengal Reddy, PD of RR dist

  • Built on the experience UNDP’s SAPAP implemented in 20 mandals: SHG – VO – Mandal Federation

  • Velugu in implementation in 820 mandals across AP.

  • Society for Elimination of Rural Poverty is the implementing agency with World Bank funding – focus poorest of the poor.

  • Key activities of the project:

    • Strengthening existing SHGs & MACS

    • Form new SHGs of the poorest of the poor.

    • Promoting village & mandal federations.

    • Promoting livelihoods through CIF & bank linkage

    • Address other major problems (child labour, disability, health and other social issues)

  • Velugu Project has MoU with VO and MS for implementing its activities – all staff placed with the MS.

  • Target oriented approach to promote a large number of Feds.

National Workshop Synthesis

Chitanya promoted gmss by ms sudha khotari pune
Chitanya Promoted GMSSBy Ms. Sudha Khotari, Pune

  • Promoted Grameen Mahila Swayamsiddha Sangha (GMSS) through an evolutionary process – started with 14 SHGs.

  • 203 SHGs, 18 clusters, 3383 members with Rs. 63 lakhs cumulative lending by Federation to SHGs.

  • 2-tier to 3-tier: SHG – Cluster – Federations.

  • Staff appointed by the Federations from SHG members.

  • A variety of savings products, fewer loan products.

  • Insurance service introduced.

  • Federation also provides non-financial services.

  • Promoting Agency played a facilitating, CB, linkages and mentoring services – responsive to the SHGs.

  • Federations has strong linkages with various government departments and programs.

  • Financial sustainability not to override the self-managed women’s institution

National Workshop Synthesis

Sarvodaya nano finance limited by mr sowmitri ceo of snfl
Sarvodaya Nano Finance LimitedBy Mr. Sowmitri, CEO of SNFL

  • ASSEFA promoted SHGs under IFAD project

  • SHGs Federated at Block level into SMBTs.

  • MBTs are private trusts with provision to invest in corporate entities and borrow from Fin. Institutions.

  • SMBTs acquired shares in SNFL.

  • SMBTs are autonomous, they are members in SNFL and are also borrowers. SNFL sets the broad policy guidelines.

  • SNFL takes care of the financial and CB needs of MBTs.

  • Considering the limitations of SMBTs in raising external borrowings, SNFL to play that role.

  • SNFL borrowing from SFMC of SIDBI.

  • SNFL is managed by professionals.

  • Reach: 74,601 members, 4,065 SHGs, 27 MBTs in 10 districts of Tamil Nadu

National Workshop Synthesis

Process of promoting federations

Process of Promoting Federations

Gist of the Small Group Discussions

National Workshop Synthesis

Group work output
Group Work Output

  • Four groups of participants from promoters & donors and one group of representatives of SHG Federations.

  • All the 5 groups felt that SHG Federations are necessary as long as they add value & not compete or conflict.

  • SHG Federations should do training, audit, linkages, supplement financial needs – service members.

  • SHG Federation reps felt that Federations should work for the overall development of women and ensure that SHGs are functioning well and engage in problem-solving.

  • Unresolved issues:

    • Financial or social or both – may be federation should decide

    • Should federation promote new SHGs of poor?

    • Should SHG promote federation or federation promote SHGs?

    • Multi-tiered institution.

    • Book keeping?

    • Protection of members savings

  • The representatives of Federations felt that Velugu should build on existing federations.

National Workshop Synthesis

Legal options for shg federations by mr v nagarajan new delhi
Legal Options for SHG Federations By Mr. V. Nagarajan, New Delhi

  • Mr. Nagarajan made a highly informative & educative presentation

  • Three broad categories: not-for-profit, mutual benefit & for-profit.

  • Possible legal forms for the SHG Federations are:

    • MACS act existing in several states.

    • Charitable Trust (also tax paying charitable trust)

    • Mutual Benefit Trusts

    • Societies

    • Combination of MACS & for profit company (NBFC)

    • Section 25 company

  • There is need for greater awareness among the promoting agencies & people’s organization regarding legal aspects.

  • Combinations and permutations of legal forms could be used to maximize financial flows to the poor women.

  • To mobilize resources appropriate legal form is necessary.

National Workshop Synthesis

Feedback day i
Feedback – day I

  • Representatives of SHG Federations were at a loss as the discussions were in English, no translation.

  • Small Groups were too large – mini-workshops!

  • Very limited time for Small Group Discussion, the output could not be qualitative.

  • Very limited time for discussion in the plenary.

  • The real issues still not being addressed.

  • The answers are still not coming, can we have a clear follow up plan.

  • Overall, a good effort & a good workshop.

National Workshop Synthesis

Theme ii resource mobilization for federations

Theme II: Resource Mobilization for Federations


Mr. Vijay Mahajan, MD of BASIX, Hyd

Mr. Kishan Jindal, DGM, MCID, NABARD

National Workshop Synthesis

Kudumbhashree kerala by mr ramanunne kerala
Kudumbhashree – Kerala By Mr. Ramanunne, Kerala

  • Started as an urban pilot with support unicef & NABARD

  • Implemented by Kerala State Poverty Eradication Mission, GoK.

  • The model: NHC – ADS – CDS (both in urban & rural areas).

  • The emphasis is on convergence with all the government departments and NGOs.

  • Implementation through the local bodies.

  • Emphasis on micro-enterprises (group enterprises).

  • Coordination by the Kudumbhashree Head Office and through the District Mission Coordinators.

  • Significant investments made in building the capacities of the ADS and CDS.

  • Bookkeeping & MIS systems established.

National Workshop Synthesis

Community based organisation a 3 tier cbo

Community Based OrganisationA 3 tier CBO




Neighbourhood Groups (NHG) at Grass roots




Area Development Society (ADS) at Ward Level




Organizing the Poor

Community Development Society (CDS)At Local Self-Government level




National Workshop Synthesis

Working group recommendations on shg federations financing by mr sitaramchandra nabard
Working Group Recommendations on SHG Federations’ financing by Mr. Sitaramchandra, NABARD

  • WG constituted by GoAP with NABARD as convenor. Bankers, NGOs, Government, APMAS members.

  • Guidelines already issued by SLBC.

  • SHG as building block.

  • SHG Federation primarily involved in financial activity.

  • Model byelaws incorporate best practice.

  • 2 years of track record for linkage.

  • Legal compliance as per MACS act.

  • Several performance benchmarks established.

  • Several financing & lending options proposed.

  • Byelaws for small federations (Village or Cluster) & large federations (mandal level) – however, 2-tier structure.

  • Based on the guidelines, GO is likely to be issued soon.

National Workshop Synthesis

Theme ii small group output
Theme II: Small Group Output financing

  • Emphasis on accurate & timely bookkeeping system – standard books of accounts across the state.

  • Transparency: audit, MIS, monitoring

  • Protecting members savings at SHG level is critical: savings to stay at SHG, regular meetings, follow prudential norms, pay interest on savings, allocate surplus.

  • Clear articulation of roles & responsibilities of federation & SHPI

  • Sustainability: user-charges, deepening, outreach, lower operational costs, ownership of members.

  • Representatives of women Federations gave a detailed presentation on what they expect from promoters during various stages of SHG Federation evolution.

  • Federations representations proposed a cost sharing arrangement between promoter and SHGs.

National Workshop Synthesis

Theme iii governance

Theme III: Governance financing


Mrs. Sudha Kothari, Chaitanya, Pune

Mr. Narender Bedi, YIP, AP

National Workshop Synthesis

Mavim presentation ms mf thekkekara ias managing director mumbai
MAVIM Presentation financingMs. MF. Thekkekara IAS, Managing Director, Mumbai

  • Women Development Corporation, Govt. Maharastra

  • IFAD funded MRCP during 94-02.

  • SHG – Village Level Committee – SH Cluster Federation.

  • Collaboration with other govt. departments & NGOs. Role of Bankers critical for financial flows.

  • Achievements: 122 cluster federations, 10,163 SHGs and 1,18,735 members.

  • Future plans are being developed to promote large number of SHG Federations.

National Workshop Synthesis

Cashe project of care by mr nagendra acharya project manager care orissa
CASHE Project of CARE financingby Mr. Nagendra Acharya, Project Manager, CARE Orissa

  • Built on the pilot project CARE implemented during 92-96 in AP, Orissa, Bihar

  • A DFID funded project in AP, Orissa & West Bengal for a 7 yr period.

  • 3-tier strategy: intensive, extensive and advocacy.

  • Working with 18 NGO partners reaching almost 466,694 women.

  • Partner NGOs facilitating member-owned & member-managed organizations: SHGs, cluster & Federations.

  • Several types of collaborations and partnerships in operation at State & National level.

  • Innovation fund for promoting development of new products and innovative methodologies.

National Workshop Synthesis

Governance apmas presentation by lb prakash apmas
Governance – APMAS presentation financingby LB Prakash, APMAS

  • Developed a quality assessment system called GRADES for assessing SHG Federations.

  • Several assessments of SHG Federations conducted in Andhra Pradesh.

  • Governance & systems are two serious issues in assessed federations:

    • Limited board training

    • Legal compliance

    • Promoter role

    • Systems are inadequate and not up-to-date

National Workshop Synthesis

In conclusion
In conclusion…… financing

  • Diverse experiences have been shared.

  • Issues related to governance, resource mobilization and process of promoting federations have been debated, to a limited extent.

  • Women representatives have made significant contributions to develop greater clarity.

  • Several questions raised in the paper have been addressed, still there are others to be answered.

  • Governance related issues require more debate.

  • May be a “core group” from the organizers of the National workshop need to take this forward.

  • National Workshop report and a “best practice” document need to be brought out at the earliest.

    Thank You

National Workshop Synthesis