Trainers Manual on SHG formation MK SINHA

Trainer’s Manual on Self-Help Group Formation

1

Trainers Manual on Self Help Group

Formation

By Manoj Kumar Sinha

Grameen Development Services

Head Office: B1/84, Sector B, Aliganj, Lucknow (UP) e-mail: [email protected] Ph- 0522 2334112, 2334432

mailto:[email protected]


2

C o n t e n t s P a g e s

A B O U T T H E M A N U A L 1-2

CHAPTER 1 INTRODUCTION 3-27

1 What is a Group 3

2 Characteristics of a Group 4

3 What is the Importance of a Group 5

4 What is a Self Help Group 6

5 What are the functions of a Self-Help Group 6-7

6 What are the Different Types of Self-Help Groups 8-9

7 What are the Salient Features of a Self Help Group 9-10

8 Why Women’s’ Self-Help Group 10-11

9 What is the Ideal Size of a Self-Help Group 13

10 What should be the Composition of an SHG 14-15

11 What should be the Frequency of an SHG Meeting 15-17

12 Timing of an SHG Meeting 17-18

13 Duration of an SHG Meeting 18

14 Venue of an SHG Meeting 19

15 Exercises 21-27

CHAPTER 2 PRE GROUP FORMATION STEPS: GAINING TRUST OF THE COMMUNITY

28-48

1. Situation Analysis 28-30

2. Rapport Building with the Community Members 30-31

3. Conducting PRA Exercises 32

4. Meeting with the Members of the Target Community

33-34

5. Exercises 35-48


3

CHAPTER 3 STAGES OF GROUP DEVELOPMENT 49-76

1. Initial Stage of Group Development 51-53

2. Intermediate Stage of Group Development 53-56

3. Mature Stage of Group Development 57-59

4. Phasing out Stage of Group Development 60-63

5. Exercises 64-76

CHAPTER 4 IMPORTANT GROUP PROCESSES 77-105

1. Participation (What is participation all about, Factors Influencing Members’ Participation in a Group)

79-83

2. Communication (What is Communication all about, Factors Influencing Effective Communication in a Group)

83-86

3. Leadership, Decision Making, and Conflict Resolution (What is Leadership, Role of Leadership in running a Self Help Group, What is Decision-making All about, What is a Conflict, Steps to Conflict Resolution)

86-94

4. Exercises 95-105

CHAPTER 5 MANAGEMENT AND FUNCTIONING OF AN SHG

106-141

1. What happens in a Routine SHG Meeting 106-109

2. Framing Norms (Norms for Timing, Frequency, and Venue of the Meeting; Norms for Membership; Norms for the Termination of Membership; Norms for the Group Leaders; Norms for Savings and On-lending among the Members; Other Administrative Issues; Reviewing and Modifying Group Norms)

109-115

3. System for Record Keeping and Accounting 115

4. Control over the Common Fund of the Group 116

5. Mechanism for Information Flow within the Group 117-118


4

6. Monitoring and Review 119-123

7. Registering a Group 123

8. Federating the Groups 124-126

9. Linkage with the Banking Institutions (The Need to Open an Account in a Bank; Formalities Required for Opening an Account; When to go in for External Funds)

126-128

10. Exercises 129-141

CHAPTER 6 BASIC RECORDS OF A SELF-HELP GROUP 142-156

1. Cash Book 142-144

2. Ledger Book 145-146

3. Pass Books 147

4. Minutes-cum-Attendance Register 148

5. Financial Auditing in a Self-Help Group 149


CHAPTER 7 SOME GUIDELINES FOR FIELD WORKERS 157-177

1. Tools to Conduct a Situation Analysis (Participant Observation; Case Studies; Key Informants; Individual in-depth Interviews; Social Surveys; Group Discussions; Wealth Ranking)

157-162

2. Focusing on Women in SHG Formation 163-164

3. Interacting in the Community and the Group 164-165

4. Facilitating Group Meetings 166-167

5. Loan Repayments and Monitoring 167-168

6. Various Financial Transactions within a Group (Capital of the Group; Income of the Group; Expenses of the Group)

169-170

7. Common Reasons behind breaking up of a Group 170-171



5

About the Manual

This manual on Self Help Group formation is primarily

addressed to the trainers who are required to train

field/community workers involved directly in the role of

mobilization and formation of self-help groups at the

community level. The field worker at this point is the key

human factor responsible for promoting and sustaining all

development programs. Howsoever sophisticated and well

intentioned the policy and design of a social development

program or project, its success or failure largely depends upon

the quality and commitment of the field level worker. S/he

intermediates between the formal project system and the

community of project service users. The systematic training and

capacity building of the field worker therefore is essential for

any successful community based intervention.

The manual seeks to address the basic training need of any

community based social development project around a specific

function – the formation of small self-help groups of poor

people, particularly women. Small, usually women membership

based, self-help groups, formed with the poor, have emerged as

one of the powerful and successful social methodologies for

creating a base for mobilizing poor communities towards

vibrant and self reliant community organizations. The self-help


6

group is the sustainable nucleus for community managed social

and economic projects in different sectors such as livelihoods

and income generation programs; micro credit and community

savings programs; community health and education programs;

and other resource sharing programs such as for water and

agriculture. Self-help group formation provides the sustainable

social base on which different sectoral programs can be

implanted and often constitutes the first step in any community

group based programming.

The manual has attempted to be exhaustive in its chosen field,

in terms of content coverage as well as exercises that can convert

abstract concepts into skills and behavior. However, in as much

as the human element will continue to play the predominant

role in any social process, such as self-help group formation, its

application needs to be tailored and creatively supplemented for

different field contexts. It is a tool, but will always need a good

carpenter for crafting a creative human process, such as people

based self-help group formation.


7

CHAPTER 1

Introduction

1.1 What is a Group?

roup life is basic to human beings. As humans, we all

have experiences of growing up in families, schools,

communities, clubs, etc. Though we all have our own distinct

identities, not entirely matching with one another, yet we do not

live alone or in isolation of others. Interaction inter se takes

place instinctively. We thus join together to be identified as

neighbors standing up often collectively to face and solve issues

of common concern such as sanitation, drinking water, security,

etc. To differentiate such group behavior from other modes of

organized social behavior, we need to know about the specifics

of a group. That is, we need to define a group.

A group therefore may be defined as a collection of three or

more individuals interested in pursuing a common goal or

objective, with mutual acceptance, and for a specific period.

The main characteristics of a group are:

Similarity of Purpose or Goal

Mutual Acceptance of one another

Commitment towards the Common Goal of the Group

Continues for a Specific Period of Time

Well Defined Norms and Criteria

G


8


9

Characteristics of a Group

Similarity of Purpose or Goal

Mutual Acceptance of one another

Commitment towards the Common Goal of the Group

Continues for a Specific Period of Time

Well Defined Norms and Criteria to Differentiate the Members from the Non-members and to regularize the Management of the Group’s Affairs


10

1.2 What is the Importance of a Group?

n many social situations working as a member of a group is

important because,

I

A concerted effort is often

more powerful as it acts with the added force of numerical strength,

It exemplifies the saying

“unity is strength”,

Group is a powerful medium of learning, adjusting, and

expressing oneself in a social situation,

It helps inculcating a sense of worth and self-reliance in an individual,

It brings people of different shades closer, provides them an opportunity to analyze and

understand their problems collectively, and encourages them to make constructive

efforts to find out a solution, and

Through the group benefits of

social programs, including those related to savings and credit launched by the government

and non-government agencies, reach an individual more easily.


11

1.3 What is a Self Help Group (SHG)?

s the name suggests, it is a group of persons dedicated to

the idea of helping each other. So is the idea behind every

group. A self-help group, however, is distinguishable from the

rest in as much as it is more forcefully goal oriented and more

closely aligned in membership.

Considered in terms of social development, an SHG is a

voluntary association of 10 to 20 people belonging to the

weaker strata of society, forging alliance to pool in their

resources (time and savings, etc.) at regular intervals for

meeting the common needs of the members. These needs

may be short-term or long-term, depending upon the

aspirations followed by the group.

1.4 What are the functions of a Self-Help Group?

ollowing are the main functions of a self-help group:

Conducting Weekly Meetings At a specified time and venue

fixed by the members.

Regular Savings Of a fixed amount and at a

fixed interval decided by the

members.

Lending and Repayment To enable the members benefit

from the common fund and

enable it to grow through

productive circulation.

A

F


12

Maintaining Books of

Accounts and Records

To promote accountability

within the SHG and establish

its credibility as a self-

sustaining institution.

Linkage and Networking To widen its scope of work.

Minimum Community Action

Program

To build trust in the

community by widening its

outlook.

Training and Capacity

Building

To provide members

opportunities to build their

capacities.


13

1.5 What are the Different Types of Self-Help

Groups?

s we saw in the preceding section, a self-

help group is primarily a self interest

group, meant to look after the interests of the

members in the first place.

A self-help group, based on the purpose for which it is formed

can be an economic group or a social group.

(A) A self-help group formed to fulfill primarily the economic

needs of its members is an economic self-help group.

The main objectives behind such a group include –

Pooling in savings spared by the members into a common fund,

Rotation of the common fund as a consumption or productive

loan to the members, and

Linking the group to financial institutions for pursuing small

business enterprises.

Many people term such a self-help group as a “savings & credit

Group”.

(B) Similarly, a self-help group formed to essentially fulfill the

social needs of its members is a social self-help group.

The main objectives behind such a group include –

To act as a pressure group for vindicating a social cause,

A


14

To act as a guild of organized beneficiaries of a social

development program,

To act as a working group for social issues such as health,

education, etc in which the members have their individual

stakes and benefit individually from its services.

This manual however focuses attention on the economic

type of self-help groups and the term SHG has been used to

mean the self-help groups engaged in economic activities,

i.e. savings and credit activities. However, the concept is

equally applicable to the social type of self-help groups as

mentioned above.

1.6 What are the Salient Features of a Self Help

Group?

It usually consists of 10 to 20 members (reasons given

separately in section 1.8).

The group can either be registered or unregistered.

It is governed by a code of conduct formulated by the members.

The code of conduct includes, among others, norms specifying

the following:

► Amount and periodicity of members’ regular contribution to

the common fund,

► Benefits such as loans to the members from the common

fund, and

► Cost such as interest chargeable on such loans.


15

Regular pooling in of savings/resources by the members

through voluntary contribution is necessary.

Means of working are democratic, allowing equal opportunity to

every member to express, articulate, and exchange her/his

views.

Maintenance of group records such as attendance register,

minutes register, savings register, loan register, etc either by the

group itself or by some personnel engaged from outside.

1.7 Why Women’s’ Self-Help Group?

omen are the most affected amongst the

socially and economically marginalized and

unemployed populations of the society.

They are more vulnerable to the struggles of life than others,

which can largely be ascribed to the lower social status given to

them within the family and society. Gender discrimination, of

explicit and implicit nature, permeates societies of all types.

Though poorer and neglected in family and society, yet women

have the potential and means of becoming significant

contributors to their household economy and overall well-being

of their families. They are, by nature, more disciplined in fiscal

matters and take their various accountabilities more seriously

as has been proved by all developmental programs. Increased

household income earned by men often finds its way to non-

productive expenditure on self rather than family. Women on

the other hand value their savings/income and tend to invest

the same for the welfare of the whole family.

W


16

Following reasons further supports the fact that self-help group

formation amongst women is both more desirable and more

viable.

Amongst the poor, women are more marginalized than men.

Women are more proficient at managing the household economy.

They are more disciplined savers.

Savings related activities serve to be an entry point in

organizing poor women for multiple purposes such as

increasing their income and employment potential, initiating

a process of self-empowerment, and improving their skills

required in exercising their livelihood choices, etc.

Working together as a collective generates strength in

women; it increases their confidence and the image of self as

individuals.

Through women, benefits reaches to the whole family.

Moreover, as a collective, they become bankable, which

opens up avenues for outside linkages to support their self-

help activities.


17

Sarala’s Story

Harichanpur Gadhikanaura is a collective of five slum areas situated beside Lucknow - Kanpur road in close vicinity of

Charbagh railway station. These five slum areas are Gadhi Kanaura, Artinagar, Premvatinagar, Shramviharnagar, and Vijay Kheda.

In one of these slums lives Sarala (aged 40), a woman of very

ordinary means in life. She is a resident of Artinagar and is a changed person from what she considered herself three years back when she was not associated with any self-help activity.

She recalls how difficult it was for her to manage her household expenses consisting of four children, herself, and a handicapped husband. Her husband

Suresh was a rickshaw-puller, who lost one of his legs in a road accident some five years back and was thus rendered jobless. His accident not only cast a spell

of gloom in their life but also rendered them without a proper means of livelihood.

Somehow, by mobilizing her available resources, she managed to start a petty kirana shop at the door of her jhuggi. This was all she could think of for earning

her bread. The shop yielded income, but it was not enough to look after the whole family. Nevertheless, she set out some money for a rainy day, even if Rs. 2 or 3, by cutting down expenses to the bare minimum.

After a couple of years, her economic conditions improved a little, though not enough to plan further expanding of her business. Fortunately, as she claims

now, she met a couple of community organizers who were working around the theme of self-help activity in her locality for some time. After attending a few

meetings, she felt convinced of the purpose behind it and decided to join it as one of its members. This opened avenues for her to know many things about the life of a woman of her class and the means to support it. From the earliest

mandatory monthly saving of Rs. 10 to today’s mandatory monthly saving of Rs. 200 over a period of three years, her group has covered successfully a long

distance. She remembers how it looked like a dream come true when her group for the first

time sanctioned her a loan of Rs. 400/- for expanding business. Similarly, she recalls, how proud and self-satisfying was the moment when the loan was repaid within the stipulated time of four months.

Accordingly, her life too changed, as she is now able to send two of her younger

children Dipak (aged 8) and Roshan (aged 10) to school. The eldest son is working at an auto garage while the second one shares her work at the shop. She is even planning to take her husband to Kanpur for getting artificial limbs. She

has recently been appointed as the new “Adhyaksha” (chairperson) of her group.


18

1.8 What is the Ideal Size of a Self-Help Group?

t was said earlier that a group can have a maximum

of 20 members. One may ask why so? Theoretically,

a group may have any number of members. However, what

needs to be kept in uppermost mind when an SHG is formed is

that –

The bigger the size of the group, the more difficult it is to

facilitate and maintain cohesiveness within the group.

Proper management of the group’s affairs, equal

participation and interaction amongst the members, equal

sharing on investment and gains – all magnify in complexity

as the size of the group increases.

What should be the minimum number of members in a group?

It could not be anything less than 3. However, that is far from

being a viable size. Experience shows that a group having less

than10 members may not have resources to generate workable

internal capital. There will be also infrequent rotation of the

group, which may lead to low financial growth. Therefore, any

group having less than 10 members will not be able to support

and sustain itself over periods. A very small group is also found

lacking in group-dynamism, expected of it for providing a social

and economic prop to its members.

TOO BIG A GROUP IDEAL GROUP UNVIABLE GROUP

I

More

than 20

Members

Less than

10

Members

Between

10 and 20

Members


19

1.9 What should be the Composition of an SHG

o maintain cohesiveness of a group, we have learnt that the

size of the group is an important factor. Another important

factor is the composition of the group.

Composition of a group is nothing but the texture of

membership pattern evincing degree of consistency or variation

in terms of their socio-economic status.

A group evidencing gross disparities in the socio-economic

status of the members is more likely to fall apart in course of

time. It also encourages domination by a few over the others.

The more a group is homogeneous in terms of membership

profile, the better. It ensures cohesiveness within the group

and synchronization with the outside world.

A HOMOGENOUS GROUP A HETEROGENOUS GROUP

The thumb rule to follow in this respect is to encourage the

poorest families in the village/community to form a group.

Ideally, the members should be from the lower economic strata.

T


20

As far as possible, members of the community who are

comparatively better off should be discouraged from entering

the group unless it is an affinity group formed on its own.

Those who are nearer to one other, living and working together

on day-to-day basis are better suited to club into a group.

The members preferably should be married and permanent

residents of the village/community, otherwise the group may

weaken because of the frequent change of members.

Likewise, someone who is already a member of another self-help

group should not be considered for membership in a new group.

1.10 What should be the Frequency of an SHG

Meeting?

group interacts only when it meets. Therefore,

without enough interaction among the

members there cannot be any viable self-help

activity. Hence, meeting of the group is an integral

part of any self-help program right from the beginning to the

end. However, the question arises at what interval a group

should meet.

Going by the experience, a newly formed group should meet

quite often, say once a week at least.

A group often acts skeptically in the initial days. Members are

uncertain in their behavior, not yet fully open to the new

situation they find themselves in.

A


21

Frequent meetings help them to get familiar with each other,

and gain a feeling of belongingness to the group.

Frequency of the Meeting at Different Stages or

Situations

S.N. Different Stages/ Situations of a

Group

Weekly Meeting

Fortnightly Meeting

Monthly Meeting

1. At the initial stage (first three months)

2. When the group has matured (after the

initial consolidation)

3. In odd cases (where

the members are very busy with either the household cores, or

the work in the field, or both)

= Less suitable; = More Suitable; = Not Suitable

Savings, and that too on a regular basis, may be a new way of

life to many in the group. Hence, to get quick familiarity with

the concepts of savings, credit, self-help, group management,

record keeping, etc it is expedient to organize weekly meeting of

the group.


22

It is also advisable that the members are encouraged to see the

advantages of weekly meetings themselves by thinking,

analyzing, and anticipating the accompanying benefits

individually and collectively. Several heads put together may

evince greater prudence.

Once the group settles down, having acquired some

cohesiveness and understanding of its role, frequency of the

meetings may be reduced to once in a fortnight or a month.

Fixing up of the frequency of the meetings, even initially, is the

prerogative of the group. However, the facilitator or the field

worker may guide the group to a decision as per its needs.

One very important fact to be kept in mind in this regard, both

by the group and the facilitator, is to see the convenience of the

group members. Where members are wage laborers, or engaged

in occupations requiring them to go outside the

village/community frequently, weekly meetings should be

avoided and instead it should be held once a month.

1.11 Timing of an SHG Meeting

he timing of the meeting should be fixed as per

the convenience of the members.

In a village situation, women are generally busy during the day

hours. They either work at home or in the field. In this

situation, therefore, it is best to hold the meetings during the

late hours of the evening.

T


23

Similarly, during the harvest season the timing of the meeting

may be adjusted as per the members’ needs.

The thumb rule here is to accord first priority to the

convenience of the members; the fieldworker’s time may be kept

flexible for adjustment accordingly.

It is nevertheless desirable to organize meetings on the same

day of the week and at the same hours under normal

conditions. Such a practice helps the members imbibe a sense

of habit and regularity and they start taking things seriously.

1.12 Duration of an SHG Meeting

he duration of the meeting should be kept at the

minimum required. The reason is the same as with

the timing of the meeting, i.e., convenience of the

members.

If the duration is too long, it may become boring and cause

undue stress to the women of the group because of their work

schedule either at home or at work.

Experience says that an hour is normally sufficient for

completing all the routine activities and formalities of a meeting.

A little discipline in this regard may yield better results. If the

members are encouraged to meet on a pre-agreed time and they

observe punctuality, waste of time in the form of late start of the

meeting can be avoided.

T


24

Similarly, if the members have an idea beforehand of the

business they are supposed to transact in the meeting, it would

facilitate timely conclusion of the meeting. Time thus may be

saved at both the ends, when the meeting starts and when it

ends.


25

1.13 Venue of an SHG Meeting

enue of the meeting is a sensitive issue in the

village or community, though in the beginning

it may not seem so.

During the initial stage of group development, the meetings may

be held at one of the members’ house. It does help the group to

be crystallized into an identity initially.

However, with the group getting more experienced it tends to

become an issue of dispute. The member at whose house the

meetings are held starts assuming weight over the others.

Therefore, it is advisable that the group starts looking for a

common meeting place. It may be a place like the local

Anganwadi Center, Village Panchyat building, Village School

building, or any common place under a tree or a shade.

Probable Venues for an SHG Meeting in the Village/Community

Anganwadi

Center

Village

Panchayat

Village School

A Place

under a Tree

House of a

Group

Member

V


26

Defining Poverty

Poverty is a state of deprivation, which is complex and context

specific. This context may be diverse such as geographical as in the

case of specific pockets of poverty, socio-cultural as in the case of

poverty due to class and caste membership, familial as in the case of

birth in a poor family, or historical as in the case of changing

perceptions of poverty in changing times. Therefore, poverty is not an

absolute term but a relative concept related to the state of deprivation,

casting definite impact on one’s capability to decide the kind of life he

or she would lead. As the standard of a desirable life differs from

person to person, community to community, or time to time, so does

the extent of poverty attributable to a person or community, in case

the desired standard of life is not achieved.

Though the incident of poverty is a contextual state of deprivation, it

also has a universal face in the sense that societies of all types and all

times have experienced it in varying degrees. This is the reason why

we see attempts all around to define poverty in universal terms. A very

common mistake that we make while identifying poverty as a

universal and absolute phenomenon is that we mingle perspectives

and contexts of one instance of poverty with those of another.

In many cases, we find that people are poor just because they are

born in poor families. Likewise, some people are less privileged just

because they belong to more disadvantaged social groups such as

scheduled caste or scheduled tribe. Another example could be of a

wage laborer who is poor for the reason that his level of productivity is

much low in proportion to the burden he owns. Yet, another example

is of women who belong to a gender, which is considered inferior to its

counterpart. Hence, poverty needs to be defined contextually as also

relatively to other instances of poverty.


27

EXERCISES

1. Encourage and help participants to find out a few examples

of social interactions or associations, which may resemble a group but not actually a group, and make a poster

presentation on that.

[Process: there are quite a few modes of social interactions or associations, which, though they resemble a group, are not actually a group as per the general definition of a group. For any

mode of social interaction to be called a group, it is necessary that it has the following five components. (i) Common goal, (ii)

members complementary to one another, (iii) Commitment towards the common good of the group, (iv) Comparatively stable membership, and (v) membership norms. Example of

social interactions or associations, which, though resembling group behavior but not actually group behavior, are many such

as a crowd, passengers, an audience, haat (market place), mela, group of onlookers, and the like. The trainer should also try to find which among the above five components are missing

from the example cited above.

2. You have already learnt that there may be different kinds of

group such as social group or economic group. This

differentiation of social and economic groups is based on the purpose a group operates for. Likewise, there may be other

types of groups based on factors like origin, composition, legal status, mode of interaction, etc. Try to find out more types of such groups with at least one example for each type.

[Process: A few examples of various types of group are: (i)

Pressure group- pressure groups are formed to safeguard the interests of its members by maintaining and exerting a constant pressure on those bodies which have the power to take a decision

in favor or against the concerned group. Examples are trade union, group of minorities, and pensioners’ society. (ii) Formal group- formal groups are those groups, which are registered or

have some legal status. Their norms are set and they have written memorandum and rules. Examples are political parties, NGOs,

Trusts, confederations of industries, etc. (iii) Informal group- informal groups are just the opposite of formal groups, having nothing set in writing. Examples are Kirtan Mandalis, orchestra

parties, etc. (iv) Natural group- natural groups are those groups, which are formed naturally such as family, species, etc.


28

Membership in all such groups is almost fixed. (v) Action group- these groups are formed to safeguard the interest of certain

people or value by initiating direct or indirect action in favor the cause they are up for. Examples are Narmada Bachao Andolan,

Bachpan Bacho Andolan, etc. (vi) Affinity group- an affinity group is a group of people of same position in life. They are formed or on the basis of similarity of its members on a particular

account such as origin of place, profession, age group, etc. Examples are a group of immigrants, a group of the aged, doctors’ club, army housewives’ associations, etc. (vii) Self interest

group- a self interest group is such a group as benefits from its resources by sharing it among its own members. These resources

may be something material such as money or something non-material such as information. Examples are self-help groups, cooperative societies, pensioners’ societies, etc. The types of

groups mentioned above are not exhaustive, nor are they mutually exclusive.

3. Organize a game to demonstrate the advantage of organized

group effort.

[Process: you can ask and help members to play games such as “Memory Game” or “The Tiger and the Lamb”. The objectives of such a game is to show the advantages of cooperative group

action over individual action and to make them think about the value of working as a group. Necessary outlines of the “Memory

Game” are given here:] Materials required:

A bag containing about 20 local objects such as articles of

clothing, utensils, a reel of thread, books, pebbles, pens, etc.

Session Guide:

Begin by saying that you would like everyone to play a

‘memory game’.

Do not tell the participants the purpose of the game.

Tell participants that everyone should try to remember all the

objects as you put them back in the bag.

Put these objects in the bag one at a time and announce its

name while you do so. Give them a chance to see it, but do not go too slowly.

When all the objects have been put inside the bag, ask any one

person from the group to stand apart from the rest.


29

The task before the members, which is same for the individual

member and the rest of the group, is to remember and recall the objects when asked.

The individual and the rest of the group will do the task

separately.

Ask the individual member and the rest of the group to sit at a

fair enough distance from each other so that they cannot hear each other.

Meet the individual member and write down her list.

Now, meet the rest of the group and note down its list of

recalled objects.

For a literate group, write the lists on newsprint so that they

can be compared.

Bring the individual back to the group. Read her list first. After

that, read the list of the rest of the group. Do not forget to compliment the individual member for her contribution.

Points for Reflection:

In almost all cases, the group will do better than the individual

on this task. Therefore, the facilitator must handle the situation in such a way that the individual member may not feel let down.

Unless the individual member has a very sharp memory, the difference between the two lists would be clear, or may be

sharp in some cases.

Steer the group to think and discuss on why the group list was

longer and what message it conveys about the strengths of a group effort.

Lead the group members to think about their own life and encourage them to analyze if they can do better as a member

of a group or as an individual.


30

4. Organize a video show to demonstrate the poor condition of

women, emphasizing the complex socio-cultural context within which they live.

[Process: Screening of a suitable video on the poor conditions of

women followed by a follow-up discussion on the message of the show helps the members to get sensitized on the issue.]

5. Organize a structured group exercise to emphasize that

gender characteristics and relations are a social construct

perpetuated by values, institutions, and practices that can be influenced and changed.

[Process: Necessary outlines for organizing a structured group

exercise “Choosing The Sex Of Your Child” are given below:-] Session Guide:

The participants imagine that they are childless and a boon is going to be given to them provided they choose the sex of their

child.

Give each participant a paper and ask her to write down or

indicate the preferred sex of her child.

Also, ask them to write down their reasons for choosing a

particular sex.

Collect the papers. Put the result on the flip chart and list the

reasons.

Points for Reflection

Number of boys and girls

Reasons for choosing the sex

The effect of these assumptions

Implications of how male and female children are socialized

and treated to prepare them for the roles they play in society.


31

6. Initiate a discussion in small groups to personalize the

experience of gender and gender based discrimination.

[Process: Discussion in small groups is useful in sensitizing the members on gender discrimination. For a discussion exercise,

follow the following process.] Session Guide:

Divide the group in to three small groups say A, B, and C.

Assign a task to each group separately.

Ask group “A” to reflect on the problems of a woman’s life

during the early stage, say from birth up to the age of 12 and make a list of those problems.

Ask group “B” to reflect on the problems of a woman’s life

during the next stage, say from the age of 12 up to the stage of her marriage and make a list of those problems.

Similarly, ask group “C” to reflect on the problems of a woman’s life during the next stage, say from marriage up to

the end of her life and make a list of those problems.

Tell each group that they are free to relate experiences from

their own as well as from other’s life.

Ask each group to make its presentation to the large group.


Tell the group that a woman plays the role of a daughter, sister, wife, and mother during different stages in her life.

However, all these roles are discriminated in family and society against their counter roles played by men.

Prompt the group to think over the possible causes behind

women’s poor condition in and outside family.

Tell them that power structures created by a lopsided use of

muscle, money, and mental powers by men have pushed the women to the backseat.

Encourage the members to view their own role in and outside family.

Encourage them to think of a solution. One of the solutions could be to strengthen themselves economically.

Lead them to believe that they can do it.


32

7. Demonstrate how a group experience is a powerful medium

for learning, adjusting, and expressing oneself in a social situation.

[Process: this is our common knowledge that a group is a powerful medium for learning, adjusting, and expressing oneself

in a social situation. In fact, all our behavior patterns in family or outside family are interactions in one group situation or the other. Examples of such group situations are family (where the

very process of socialization begins), neighborhood, community, school, workplace, etc. In spite of its being a common knowledge,

however, any intentional transference of it to a group of trainees would require a powerful medium in order that they not only come to know of it at the information level but also feel motivated

to form and sustain their own self-help group. One of such mediums is a case study (there could be many more mediums which you may think of). The case study “Sarala’s Story”

presented in chapter I can be used by the trainer for this purpose.]

8. Present a case study where a self-help group or any other

group takes up a wider community issue.

[Process: A self-help group in its basic function is a self-interest

group whereby it works to the benefit of its own members. However, when it takes up a wider community issue such as of

health and education, it acts more as an action or a pressure group whereby it provides an opportunity to organize and act pro-actively, not only in its own interest but also in the interest of the

community. An example of this is closing down of a village liquor shop by a group of affected women. Such case studies always

leave a very positive effect on its audience/reader and motivate them to organize and act on a similar line. An outline of a case study like this is given on the following page, which may be

developed and used in a training session.]


33

n a remote village of Nellore district of Andhra Pradesh, there

lived a poor woman Sitamma whose husband was a drunkard.

Everyday in the evening, after his day’s work was over, he would go to a local liquor shop and drink there until late night. Thus, he used to lose all his earnings before he could reach home. Sitamma

was a member of an adult literacy group of the village and was thus trying in her own little ways to change the conditions of her

life. The condition of the rest of the members of the literacy group was hardly different from that of Sitamma. They came to know that being fed up with every day’s squabbles and conflicts with their

husbands quite a few women of the village even committed suicide. They wondered how the liquor shop is always replete with stuff whereas the government rashan shop lacked often the most

essential commodities. Slowly but surely, they realized that they themselves would have to do something in this regard.

One day a few of these women gathered in front of the liquor shop and put a pressure on the owner to shut it down. The shop had to

be shut down that day. This became a news and got spread in nearby villages like a fire in the forest. Women of other villages also

drew motivation from this incident and before long, many women’s groups came to the fore to tackle this menace in their own ways. In one of such case, women of a particular village prepared food and

took it to the liquor shop owner where they vigorously asked him to eat it all. They told him that for so many long years he had snatched food from their mouth; therefore, now he must entirely

swallow it himself. This frightened the liquor shop owner. He closed down the shop and ran away. In a short time, this turned

into a movement and spread not only in south India but also in other parts of the country. Thus, what the administration and the social workers of intent could not do in so many years was done by

a group of women who looked naïve but firm and committed to their intention and will.”

9. Organize a poster presentation on factors promoting group

cohesiveness such as size and composition of group, and timing, frequency, duration, and venue of group meetings.

[Hints: Poster exhibition renders a joyful learning experience with

possibility of fast and deep-rooted learning. It also provides a welcome variation to routine learning sessions. For a session on poster presentation, divide the large group into smaller ones and

assign each group a separate theme to prepare a poster. Materials

I


34

required for a session on poster exhibition are poster papers and color/sketch pens of different colors.]


35

CHAPTER 2

Pre Group Formation Steps: Gaining Trust of the Community

ormation of women’s self-help group is a dynamic but slow

process as it deals with poor women living within a

complex socio-cultural context. Therefore, an understanding of

the various steps involved in the group formation process is

necessary to form self-sustaining and self managed groups. A

basic skill required for workers forming SHG is verbal

communication in the local language, which the group members

are comfortable with.

The initial steps required before the actual group formation

process begins are the following.

2.1 Situation Analysis

ituation analysis refers to the background preparations for

initiating a project on SHG formation and development. It

is a tool to understand the environmental context within which

the SHG or the development project has to be conceived and

implemented.

Before all other things, a development agency has to decide

about the geographical area where it would like to work over a

period of time. This choice depends on many things such as the

agency’s mandate, its expansion plan, needs of the area, donor’s

interest, etc.

F

S


36

When the choice of the geographical area has been made, efforts

to gather detailed primary and secondary data on that area fall

due. Situation analysis thus helps in choosing a village,

community, or a project area and paves the way for the agency’s

entry into the project.

Various dimensions within which a community exists are

examined in a situation analysis exercise. They include the

local

► Political and administrative structure,

► Demographic features,

► Economic activities,

► Social stratification and power relations,

► Organizations and their functions & activities,

► Leadership pattern and its influence,

► Cultural facets or traditions,

► Health, sanitation, and nutrition levels,

► Education,

► Critical issues and problems affecting the community.

Within the specific context of an SHG formation and

development project, a situation analysis of a particular

community will include a livelihood analysis of the people

depicting their occupation, socio-economic status, mechanism

with which they cope with seasonal lean patches, potentials for

a ‘savings and credit’ program, extent of indebtedness and credit

needs, etc.


37

Such an exercise not only provides the development agency with

valuable data for planning strategies but also enables it to get a

foothold in the local area, which is the first step towards

building trust.

2.2 Rapport Building with the Community

Members

ith this exercise, the process of group

formation actually begins. Earlier exercises

were only unilateral, mostly at the level of the

agency and without the involvement of the

community members.

Rapport building is a focused interaction of the agency with the

village and community members, the aim of which is to

strengthen the process of group formation in the near future.

Without proper rapport building, which forms the basis for

mutual trust, there can be no viable group formation.

Once a village or community knows the members and workers

of the agency and their program, it becomes easier to initiate

and launch the planned intervention. Rapport building is also

an exercise to understand the problems and needs of potential

group members.

Experience has shown that when community groups are formed

only to achieve the goals of the agency without addressing to the

problems of the members, they wither away once the agency

withdraws.

W


38

Hence, rapport building is not only required to gain the trust of

the community but it is also required to secure empathetic

understanding of the community’s problems and needs.

Far better would be to develop a relation of mutual trust

between the agency and the members of the community right

from the beginning.

By rapport building, it is also made clear that the agency has a

primary interest in the lives of the members and their long-term

benefit.

At the same time, they may also be made to understand that the

actual change in their life will come about only when they

organize and actively participate in the change process with

members and stakeholders. Group formation is the first forward

step in this direction.

Initially, informal contacts are made on personal level with the

local facilitators such as community leaders, tribe heads, school

teachers, PRI members, local key informants, etc., which helps

to gain acceptance of the agency by the village/community. In

those introductory meetings, the agency projects its image and

shares general information about itself.

All these meetings provide opportunity to gather information on

the basic nature of the community and its members. They also

facilitate the forging of lively relationship between the agency

and the community, needed for a collaborative action.


39

2.3 Conducting PRA Exercises

In spite of the initial steps outlined above, the agency remains

at the periphery of the community until it holds a series of

meetings with small groups of potential members, especially the

women in specific neighborhoods where SHGs are to be formed.

There is, however, a strong likelihood for the agency to be led by

the local facilitators’ choice of selecting group members, who

may not be the right representative of the poorest within the

community. Where the objective of the project is to work with

the poor, it is essential that initial meetings be held with the

groups of the poor. Usually they are less heard, hence less

responsive in attending to early meetings. Non-attendance by

community members may also be analyzed to ensure that the

proposed group members truly represent the target group.

Therefore, it is desirable that the agency makes its own

assessment of the community members present in such

meetings. The more homogeneous socio-economic status of the

group members, greater would be the chances of the group to

sustain and succeed.

In case the community or village is large, the field-worker may

conduct a proper survey or apply PRA tools such as Wealth

Ranking, etc. and avoid going by his/her hunches.

This is a critical initial step indeed, as the specific members

forming a group largely determine the future shape and

survival of an SHG.

Chapter 7 of this manual provides further guidelines on using

PRA tools.


40

2.4 Meeting with the Members of the Target

Community

These initial meetings with the prospective group members are

an opportunity for the field-worker to win their trust and at the

same time outline the purpose of the project and the rationale

lying behind. Benefits accruing to individual members forming

the group also get a chance to be highlighted simultaneously.

A few of the suggested activities for these initial meetings are ––

To help the members introduce themselves in a group setting.

To initiate a discussion among the members on issues such

as livelihood systems, income and expenditure patterns,

health needs, and other problems permeating their day-to-

day life.

To discover their savings habit, credit needs, sources of credit

available, rate of interest they have to pay, and the terms of

repayment, etc.

To explain how they can themselves cerate their own

common fund by saving small amounts of money every week

or month and thus reduce their dependence upon outside

credit sources.

To fix a date and time when the potential group members

could meet next.


41

Women as a measure of preference may be encouraged to form a

group of their own to canalize saving and to plan self-help

activities.

The agency should spell out its role and scope of participation

for future meetings and must allow interactions with the

members to continue unabated.

At the end, a tentative list of the group members should be

prepared for follow-up action. The foundations of a women’s Self

Help Group, consequently, are laid.


42

EXERCISES

1. You have learnt in the preceding chapter that situation

analysis is a tool to understand the environmental context within which the SHG or the development project has to be

implemented. To help participants conduct a situation analysis in their own respective field, hold a session or two,

which may impart them necessary skills for doing so.

[Process: components of external environment such as social,

economic, political, cultural, educational, and demographical, can have a dramatic and important impact on the implementing

development agency’s successful operations in a community, which may even impede its continued presence there if not understood and handled properly. Therefore, it is necessary that

before field workers actually go on board for organizing self-help groups, they make an analysis of the community from various angles such as the socio-economic status of the members, their

resources, their potentials for savings, credit needs, etc. Information collected from such scanning exercises can be

classified in to the following categories.

Categories of Information Instances

1 (Example) 2 3 1. Threat (An unfavorable

situation which tends to

affect the performance of

an implementing

development agency)

In a neighboring village,

people’s bad experience

with an outside agency,

which decamped with

members’ deposits.

2. Restriction (A situation

which limits the operation

of an implementing

development agency)

Inhospitable geographical

conditions like a

mountainous terrain or a

desert area. Presence of

another outside agency which is non-serious in its

approach.

3. Problem (A situation

which requires an

adequate solution to

prevent it from becoming a restriction or threat)

A stratified community

where people are very

much divided on the lines

of caste and creed.

4. Negative Symptom (A

situation which allows for the forecasting of a

problem, restriction, or a

threat)

A village or a community,

which has a high prevalence of alcoholism

among men or a strong

‘Pardah system’ among

women.


43

Categories of Information Instances

1 (Example) 2 3 5. Neutral Variables (A

temporary neutral

situation, but with the potential of becoming

positive or negative)

People are politically

active.

6. Positive symptom (A situation which permits

the forecasting of a

stimulus or opportunity)

Responsiveness of local community leaders.

7. Stimulus (A favorable

situation that can be

transformed in to an opportunity)

The formal community

leader, say ‘Pradhan’,

‘Mukhia’, or ‘Sarpanch’, is

a woman and is

responsive as well.

8. Opportunity (A favorable

situation that can

positively affect the

performance of the

organization)

People already have a

good experience of a

similar project in the past.

Following structured learning sessions should be organized by

the trainer to orient field workers in the know-how and techniques of conducting a situation analysis.

Session - I

Objectives

To identify the characteristics of a target

community.

To decide what information is needed to understand a specific characteristic of the

target community.

Time

One and a half hours

Materials

Black/white board,

Chalk

Felt pens,

Newsprint,

Writing paper

Learning

Method

Brainstorming


44

Session Guide:

Instruct the participants to reflect on the community they are working with and note down (individually) on paper what each

one should know about that particular community as a field worker (e.g., number of families, leadership in the community,

Political and administrative structure, demographic features, economic activities, social stratification, power relations, etc.). Ask them to make the lists as comprehensive as possible.

Direct them to get into pairs, review each other’s lists, and then compile a common list.

Instruct them to form groups of four and develop a group list after discussing the two lists they already have. Ask them to

put the list on newsprint. Get each group to select a spokesperson to present its list to the entire group.

Reassemble the groups. Invite the spokesperson from each

group to present its list.

After each presentation, encourage additions, comments, and questions from participants. Allow enough time for discussion.

When all presentations are complete, display the lists in front of the group and prepare a common list by deleting, modifying,

and combining items. Try to reach group consensus.

Note to the Trainer

Ensure that the list includes the following items

Political and administrative structure,

Demographic features,

Economic activities,

Social stratification and power relations,

Organizations and their functions & activities,

Leadership pattern and its influence,

Cultural facets or traditions,

Health, sanitation, and nutrition levels,

Education,

Critical issues and problems.


45

Pose the question to the group, “What information is needed to

understand these characteristics of the community?” Select a single characteristic from the above list. Brainstorm for ideas and write them down on the board or newsprint as they are

presented (e.g. types of livelihood sources, credit need, local sources for credit).

Once all the ideas are exhausted, review the responses with the group and reach a consensus on the major items. Indicate

to the participants that a long list is not necessary as this is not a detailed study on the topic.

Repeat the same procedure with a few other selected items.

Conclude the session by highlighting the main points.

Session - II

Objectives

Identify sources of information and data for

understanding the community.

Understanding the advantages and disadvantages of different techniques in

collecting information and data.

Assess the effectiveness of selected techniques in gathering information and data.

Time

One and a half hours

Materials

Black/white board

Chalk

Felt pens

Newsprint,

Writing paper

Learning Method

Creative Reflections


46

Note to the Trainer Ensure that the sources include items from the following list

Documents or files in government offices/NGOs,

Reports or surveys pertinent to the topic,

Community members (a sample),

Informal leaders in the community,

Senior citizens

Government officers or formal leaders,

NGO personnel,

Politicians, central or local government

representatives.

Session Guide:

Direct the participants to review the final list, which they prepared during the session on situation analysis to identify

the characteristics of the target community and the information needed to understand a specific characteristic.

Thus, select a list prepared for any one characteristic such as the economic activity of the people.

Ask the participants to identify possible sources of information

to know the economic conditions of the people of the community.

Write down their responses on the newsprint/board. Encourage different viewpoints. Allow sufficient time to

exchange ideas and clarify issues.

Discuss and complete the list.

Ask the group, “How can we get information from the above sources? What sort of methods or techniques could we use?”

Brainstorm and write down the ideas on the board.

Discuss and complete the list.


47

Divide the participants into three groups. From the techniques

identified, assign three or four techniques to each group. Instruct each group to discuss the advantages and limitations of each of the techniques assigned to them.

Reassemble the group. Request the spokesperson to present their lists. Allow time for comments and criticisms.

Summarize the discussion. Make sure that the important ones are stressed.

Note to the Trainer

Ensure that the following methods are considered:

Documents review,

Questionnaires,

Focused group discussions,

Interviews,

Observations,

Listening to people

Brainstorming sessions,

Informal conversations.

Important Points to Remember when

Collecting Information from the

Community

No single technique is appropriate to get information from all the sources.

The best option is to use a variety of techniques,

wherever and whenever possible.

The most common techniques are questionnaires, interviews, and observations.

Group discussions (also referred to as ‘focused

group discussion’) are also frequently used.


48

2. Demonstrate the importance of developing trust among

participants by generating an experience of it in them.

[Process: A few games such as ‘Trust Walk’ or ‘Individual Fall in a Group’ are quite effective in enhancing trainees’ understanding on the need for mutual trust in any bilateral relationship.

Necessary steps to organize the game ‘Trust Walk” are give here:]

Session Guide:

Chalk out a long path that contains plenty of obstacles and

difficulties e.g. stones, steps, doors, benches, bushes, etc.

Ask each one to select a partner from the group and form

pairs.

Blindfold one partner from each pair.

Ask the other one to guide the blindfolded person through all

the obstacles placed on the way, and take her to the goal.

Ask the blindfolded person then to return to the starting point

without any help.


How did you feel during the walk blindfolded?

How did you feel about being totally dependent on your

partner for your safety?

Were you confident about your partner?

Did you mistrust her? Why?

How did you react at various difficult points during the walk?

Discuss elements of trust between people, dynamics of trust and non-trust positions.

3. Organize a session to highlight the need to secure the trust

of community people, while being involved in an

empowerment process.

[Process: Developing mutual trust is essential for a fruitful partnership between the development agency and the community. It has been found generally that the community people, in their


49

first reaction, are suspicious of outside visitors, especially of those who are new or stranger in the locality. This shred of doubt

may remain until they do not become sure of the development agency’s good intentions as professed by the field-worker and

reflected in his/her mannerism. However, it is equally counter productive to raise undue expectations in the people for gaining their trust because when such expectations are not met, people

lose faith and everything goes haywire. A field-worker, therefore, needs to be careful while gaining entry into the community, as much of future development would depend upon the successes in

gaining people’s confidence in a realistic way during these initial meetings. As a trainer, therefore, you need to emphasize to your

trainees the importance of building trust as a stepping-stone to all future collaborations with the members of the community in general and with the members of the self-help group in

particular. Enacting a mock community meeting would help the trainees to develop important insights into the matter. Outlines of

such a mock meeting are given below which you may further develop or use as such in your training session.] Session: A Mock Community Meeting

[Scene of the courtyard of a “village pradhan’s” residence where a meeting, organized by the field workers of a development agency

to express their plan and willingness to work in this village, is about to begin. This meeting is also being attended by a few other

community members and local leaders. Village pradhan welcomes the field workers and introduces them to the rest of the people present in the meeting. He then invites the field workers to say

something about their agency and the program for the village. Field workers thank the village pradhan and others present.]

FWs: We are ‘X’ and ‘Y’ from ‘Gram Vikas Sansthan’ and are planning to begin our work here.

VP: What work, sir?

FWs: Well, we are a social development organization and we promote poor women’s self-help groups by mobilizing and training

potential members. VP: That is a good idea. But sir, how do you motivate people to

become members? Do you give any grant, loan, or subsidy to them?

FWs: Well, (after looking to each other) we may, sir! It depends upon the progress of the self-help group.


50

(FWs = Field Workers; VP = Village Pradhan)

Questions to be Raised During the Debriefing Session:

What did you see in the scene?

Do you think the field workers made any mistake while telling

the village pradhan about the way they motivate people to form their own self-help groups?

What mistake did they make?

What impact will it have on agency’s future prospect in the

community?

Note to the Trainer:

Commencing your work on a wrong foundation is always liable to backfire. Tell the participants that there is no shortcut to gaining

the trust of people. Being patient, straightforward, and honest to one’s intentions is the only way to succeed in this. Making

promises such as of a grant, loan, or subsidy, which are not meant to be fulfilled, would only drive people away from the real objective of the program, that is, their empowerment through

collective action and self help.

4. Simulate a group situation through a structured group

exercise to highlight the fact that the poor are less heard and often initially less responsive in attending early meetings

with the development agency.

[Process: the poor within a community act as a subgroup to the larger group and hence, are guided by their own perceptions of power structures rooted in class and caste divisions around

them. Often this acts as an obstacle to the foundations of a self-help group, which, as per the objectives of the project, should be representative of the poorest within the community. Use of a

structured group exercise is a useful way in helping the trainees understand the importance of being empathetic towards the

needs of the marginal community members while mobilizing support for a self-help group. Outlines of such an exercise are given below.]


51

Session Guide:

The trainer divides the group of participants into two sub-groups A and B. ‘A’ is the poor sub-group, which consists of

poor members whereas ‘B’ is the better-off sub-group, which consists of better-off members of a self-help group.

The trainer himself plays the role of a field worker, who is holding a meeting with the potential members of an SHG

consisting of the members of sub-groups ‘A’ and ‘B’.

The task before the group is to decide the name of their self-

help group.

Before the start of the exercise, the trainer tells the sub-group

‘A’ separately that they are the better-off members of the group; hence, they are supposed to take a leading role in all the activities of the group. He also says that he himself will

side with them.

The trainer gives both the sub-groups (‘A’ and ‘B’) ten minutes’

time to think over a name.

After the time is over, the trainer, who is acting as a field

worker, asks both the sub-groups to reassemble. He then invites the members of both the sub-groups to suggest a

name.

He deliberately encourages the members of sub-group ‘B’ more

that those of ‘A’ and clearly shows his favor for ‘B’.

After that, he gives five minutes’ time each to both the sub-

groups to put three reasons as to why they think the name of the group should be that.

In the end, he purposely votes for the name suggested by the

group ‘B’.


Is sub-group ‘A’ happy with the selection of the name for their

SHG?

Do the members of ‘A’ think that the field-worker showed

partiality in handling the situation and did not give them sufficient opportunity and support as compared to ‘B’?

What did they do for making themselves more assertive?

What the members of ‘B’ did to ward off the partiality shown

by the field-worker in showing his preference for ‘B’?


52

Whose responsibility is it to encourage, help, and support the

marginal members of the group for taking active participation in group meetings and tasks?


The trainer has to emphasize that in the group formation process

the role of the field worker, more than anyone else, is to see that the marginal among the potential group members from the community are encouraged and motivated to participate in early

group meetings so that the objective of the project to work with the poor is met. Because the poor are less heard, they also tend to become less responsive out of their low morale and feelings of

various insecurities. The better off members, showing natural human tendencies to outrun others, will always act competitive

and dominate over the less privileged ones. Therefore, it is the agency people, and in the field situation, it is the field workers, who have to ensure that the group is representative of the poorest

within the community. For this, he may even have to sensitize other community and group members towards such a need.

5. Organize a session to promote the participants’ self-

awareness and confidence, especially of the poor and withholding members, in expressing themselves in a group

situation.

[Process: helping the participants to get in touch with one’s inner

self is one of the techniques which has been successfully used in various training programs to build a sense of worth and self

esteem in rather shy, withholding, or non-active community members. Lack of willingness in such members to attend meetings during the early stages of rapport building is, in most

cases, a result of various complexes in their life situations as well as within themselves. Organizing a session where they can unwind themselves and come face to face with their own inner

values, inhibitions, and aspirations can be very refreshing. It can help them to have a better understanding of their problems, as

well as potentials to overcome them. An outline of such an exercise (known as the game “Who Am I”) is given below, which you can use in training sessions.]


53

Session Guide:

Explain to the participants that they will be thinking about

themselves and what is important to them. We need to know ourselves better before we can solve our problems in a better

way.

Tell the participants that they are going to play a game called

‘Who Am I’.

Divide the participants into smaller groups of five or six.

Meet each group separately and instruct them to think of all the possible identities they have or all the roles they play in

their everyday life, like that of a teacher, a mother, a wife, an aunt, a worker, etc. Explain that the teams will then compete

to see which team thought of the most.

After the members have thought over it, write down the

identities of each member of smaller groups separately.

After all have responded, once again ask all the members if

they would like to add to the list. The team with the longest list would be the winner.

Start a discussion in all small groups on what they do and

how they live.


Which of these roles did you choose yourself?

Which roles, however, were given to you?

What are some of the things you do in your different roles?

Which roles you like and why?

Which roles you do not like and why?

Could you change these roles?

Is there any other role, which you would like to do? Why?


Make participants feel appreciated for many things, which they are and they do. Show your appreciation for the different roles, which they have to play and manage in their every day life. Point

out to them that there are some roles in which they have choices whereas there are others in which they don’t; however, there

always is a way to make things smoother and better.


54

6. Organize a few games and activities, which help participants

introduce them in a group setting or relax in between sessions.

[Process: there are a number of games, icebreakers, or energizers, which you may use for such purposes. A few of them are given

below.]

1. Relay Game

The person who begins the game gives her name. The person next repeats the first name and adds on her own. The third person mentions the first two names and then adds on her

own. The process continues until the last person mentions his/her name along with the names of all the group members.

The game can be made more interesting when along with the name, the person does an action, which gives a meaning to

her name and the action is repeated along with the name.

2. Yes-No Stones

Each participant starts with five stones, or seeds, or whatever

is available. The players circulate around the room asking each other question and making replies. However, the rule is

that players must not use the words ‘yes’ and ‘no’ in any of their replies. Whenever a player succeeds in ploying another into saying ‘yes’ or ‘no’, she gives that player one of her stones.

The first player to get rid of all her stones wins the game.

3. Keep It Up

Participants are divided into groups of 5-6 each. All are asked

to stand with their respective groups. Each group is given a balloon. When the trainer gives a signal, all the groups throw

their balloons up in the air. Each group must keep its balloon up in the air as long as possible by blowing at it. no touching of the balloon by hands or any part of the body is allowed. The

group that keeps the balloon up until the end is the winner.

4. Mrs. Mumbley

All the participants sit in a circle. One of the participants asks the following question from the participant sitting on her right: “I am looking for Mrs. Mumbley, have you seen her?” The

participant who is asked replies: “No, I haven’t. But I will ask my neighbor”. And she asks the same question from her neighbor sitting on her right. This way all the participants do

their turn. However, the rule of the game is that while


55

speaking, no one can show her teeth. Thus, everybody attempts not to show the teeth while speaking. This creates a

lot of fun and laughter among the participants and they feel light and relaxed.

5. Uncle Says

Participants spread in front of the trainer. The trainer orders the players to do various actions, such as touching their toes

or raising their arms. However, there is one condition: if the trainer begins the order with the words “Uncle says” then the participants must obey the order. If he does not begin the

order with these words, then the participants must not do the action. If any participant makes a mistake, he is out of the

game.

6. Hit Me If You Can

Participants sit in a circle. One volunteer comes to the center

with a stick of paper. He then goes to hit any one of the participants with the paper stick. That participant is supposed to take the name of any other participant before he is hit. If he

does so, the volunteer can not hit him but has to go to the participant whose name is taken. Now, the referred participant

will take the name of another participant before he is actually hit by the volunteer in the center. If any participant is unable to call another name before he is hit, then he is out from the

circle and has to volunteer in the center in place of the volunteer who hit him.


56

CHAPTER 3

Stages of Group Development

he self-help group’s form, stability, and

future performance depend upon the way

it develops and evolves. As the development

of an SHG is a people intensive and process

oriented activity, at each higher stage of group development, the

role of the field-worker assumes importance, and at the same

time requires a role shift.

One may ask as to how many stages a group passes through

during its course of development, and what actually we mean by

the term “development” in the context of a group.

Development is an ever-ongoing process, be it of a group or

anything else, and hence, its segmentation in stages is only for

the sake of a better understanding of it. As we divide time into

hours and minutes, so we may divide the group’s development

process into different stages.

The course of a group’s development is determined, on the one

hand by the inflow of certain inputs from the agency and, on the

other hand, by the group’s learning response to it.

The process of development of a group is a function of the

following factors:

T


57

Assessment of the learning needs and objectives of the group

by the agency.

Flow of inputs from the agency to meet the learning needs

and objectives of the group, and

The learning responses from the group, i.e., how well and

quickly the group learns the required skills and behavior

pattern which are necessary for its functionality and

sustainability. This is illustrated in the following diagram: –

Figure - 6

In the following sections, a suggested process model for

development of a group is given for the readers to either adopt it

as it is or tailor it as per their requirements. For each stage, the

behavior of the group and the activities to be facilitated have

been outlined separately.

Assessment of the

learning needs of the group

Learning Response

form the Group– how well, how quick

Process input flow

from the agency as

per the learning

needs of the group

2

1 3

Factors

influencing

group develop-

ment


58

3.1 Initial Stage of Group Development

his stage of group development begins with the first meeting of

the group. In the normal course of development, it should not go

beyond two-three initial meetings held over a month.

Group’s Behavior

At this stage, the members are very tentative in their motivation

in forming a group and find it difficult to relate to the group.

They have hidden doubts about the group’s objectives and the

motives of an external field-worker. They even fear ridicule at

the hands of their relatives and neighbors. They also find the

idea costly in terms of investing their personal time and money

to a venture whose future returns are collective and uncertain.

Process to be Facilitated

All the activities during the early stage of the group building

process is directed towards seeding the idea of self-help in the

members and motivating them to form their own self help group

around some common resource pooling idea (such as group

savings). It is important that they also understand and analyze

the causes of their poverty and indebtedness through focused

group discussions facilitated by the agency’s field worker. The

field-worker, therefore, should take-up the following issues for

discussion at group meetings in this stage: –

Discuss with the members, the cause of their poverty and the

interplay of low income and high indebtedness among them.

T


59

Discuss the problems of borrowing money from the local

moneylenders both in terms of financial cost and loss of

dignity.

Discuss the status of women with regard to their

contribution in domestic and wage labor vis-à-vis their low

income and the invisibility of their work/output.

Explain to them the concept of collective self-help, the

advantages of regular savings in a common fund as a means

of self-help, and how they can realize their strength as a

collective.

At this stage, the women need to be made aware of the fact

that the savings activity is actually a means to their socio-

economic empowerment and not an end in itself.

Explain to the members that they can save a little despite

their low income. Convince them that a little amount of

saving need not be always sourced from a surplus income

but can be generated from within their existing means.

Explain that their savings remain with the group and they

manage it by themselves. Create a faith in their ability to do

so.

Facilitate them to give a name to their group, which

enhances group identity. Get them to finalize a date from

when to start savings activity. To begin with, suggest a low

amount of money for regular savings. The amount should be

the same for every member and it should be kept low enough

for the poorer members to save and join the group.


60

The above process will take a fairly long time, especially if the

groups being formed are the first ones in the area. Time needs

to be given to the group to appreciate the positive aspects of

working together. It is often useful at the end of this period to

choose a leader from amongst the group through an informal

election process by the members.

3.2 Intermediate Stage of Group Development

his is the stage of group development when the members

have just started pooling in their savings in a common

fund. However, as the practice of saving is only at its elementary

stage, and not yet stabilized, care needs to be taken by the field-

worker to consolidate this development so that the practice

takes deeper roots. In an ideal situation, this stage should not

stretch beyond a period of four to five months.

Group’s Behavior

The group’s behavior at this stage starts becoming positive

towards the field-worker and the members start linking

themselves to the objectives of the group. At some point of time

during this stage, rotation of the group fund begins as the

members start coming up with a demand for a loan or ways to

use the money saved collectively by them. However, it is

advisable to make the group save for at least six months to

ensure that the practice of savings becomes a normative

practice within the group and the group members are able to

actually see the money saved accumulating into capital. This

gives them confidence as a group.

T


61

In between the initial meetings, there is always a talk in the

community and among the members about the group. There is

often an element of disbelief or amusement among the male and

elderly members of the community about the initiative. There is

also possibility of rumors spreading about the malafide

intentions of the agency. So, there is a likelihood that some of

the members drop out from the group and some new ones join.

Such responses are found more in those cases where the

community did not have any experience of a self-help group

before.

However, as the time passes and the group has had more of

meetings and interactions, their early skepticism ebbs out.

A few of the members may now start showing some expectations

from the agency such as some grant or loan. Likewise, they may

seem very much worried about the fate of their own

savings/contribution. This is a very critical period within a

group’s development and the agency needs to take a series of

steps to counter this, as most groups may disintegrate during

this stage.


Organize one or two community meetings with the help of

local facilitators to remove any misconception among them

about the ongoing program and its activities, and to mobilize

wider community support.

Repeatedly, explain to the group the actual role of the agency

in all these activities, which is that of a facilitator and

enabler and not of a grant provider so that misconception, if

any, may be cleared at this stage itself.


62

Make home visits to the members who have dropped out, or

to those who need any extra counseling about the group’s

activities.

Train the members on the functional aspects of group

behavior and management. For example, facilitate their

understanding on the necessity of leadership and democratic

group norms, role of participation in group transactions and

collective decision making, establishment of group norms to

manage finances, etc.

Identify natural group leaders. Encourage backbenchers and

fence sitters so that they may open up and participate in

group activities. Employ a few group exercises and games to

break the reservation of withholding members.

Explain to the group the role and functions of group leaders

and facilitate their selection through consensus, nomination,

or election.

Help the group spell out the role and responsibilities of its

leaders/office bearers.

Facilitate the group to establish group norms with respect to

a number of issues such as: -

► Timing, frequency, and venue of group meetings

► Selection and rotation of group leaders

► Amount of regular savings by the members

► Mechanism of on-lending among the members

► Membership norms for bringing in new members.


63

► Termination of membership

► Issues like absenteeism, late attendance, etc.

Also explain the importance of maintaining group records

such as membership register, attendance register, minutes

book, and savings register. Introduce these records in the

group as and when they are required.

Identify someone in the group to write and update the

records. If there is no literate woman in the group, ask the

members to identify one in the village who can function as

the accountant to the group.

Inculcate in the group the practice of updating summary

records like total savings, total revolving loan, income

through interest, etc. after each meeting. This may preferably

be done on a black board discernible to all. Such practices

promote transparency in financial matters.

Facilitate the purchase of necessary things for the group like

stationery, cash-box, etc.

Facilitate the group to open an account in a nearby bank.


64

3.3 Mature Stage of Group Development

his is the stage when the group is already on its way to

settling down in things like membership pattern, financial

and administrative norms, transactional norms, etc. It also

shows steadiness in its practice of savings and loan rotation.

At this stage, consolidation work needs to be done by the field-

worker so that the group may further become mature and self-

sustained.

This stage being over, the group should be at the end of its first

year of existence.

Group’s Behavior

During this stage of development, things do not happen as fast

as they happened earlier. The initial curiosity and drive of the

members seem to subside a bit as a natural outcome of frequent

meetings, longer learning sessions, and the achievement of the

immediate goal of the group, i.e., formalization of group norms.

The group wants some change and do something new.

The phenomenon of sub-groupism enters the group at this

stage. Sub-groups (which are a collective of a few members

within the group based on their previous relationship outside

the group) try to compete with one another in influencing the

field-worker and the rest of the group members for necessitating

certain decisions in their favour. Depending upon their alliances

outside the group, the elected leadership is either supported or

challenged by the sub-groups.

T


65

All these internal pushes and pulls are actually a sign of

members’ active participation in the group development process

and are natural. The initial sub-groups based on the outside-

the-group alliances however usually break giving way to a new

relationship based only on their stake in the common objectives

of the group. At this point of time, the group’s leadership

pattern and group norms are tested and may need change

through the agency facilitation.

The group members start showing interest in different group

tasks and gradually develop a deeper understanding of the

status of the group vis-à-vis their own individual role. Their

adherence to the group norms increases and so does the

demand for initiating new income-generating or other allied

activities that could further benefit them.


Organize a few interesting group based activities and training

programs, to enliven the group’s spirit and promote greater

cohesiveness.

Organize a visit of the members to a nearby self-help group,

which is operational in an ideal way. This will provide the

members a gainful learning experience as well as a change

from their routine activities.

Organize skill building training programs on subjects like

fund operation and financial management, leadership

development, record keeping, program planning, financial

monitoring, negotiating with public systems like banks and

local government authorities.


66

Emphasize in your training sessions the need for correlation

between individual and group goals and the ill effects of sub-

group associations.

Organize training programs to enable the members to

understand important group processes like participation,

communication, leadership and decision-making, and

conflict resolution.

Depending upon the demand and its repayment record,

facilitate outside loans to the group.

Initiate the group’s linkage with banks for accessing credit

for the group fund.

Encourage a discussion among the members on various

income generating activities/social activities, which the

members can do collectively.

Facilitate the group to prepare a long-term plan and arrange

training sessions on the management of new activity chosen

by them.

Reduce the frequency of the field worker’s visits to the group

gradually.


67

3.4 Phasing out Stage of Group Development

his is the stage when the group has stabilized as a cohesive

unit and gained enough self reliance in managing its own

affairs and activities.

The group is also expected to develop financial sustainability by

this stage. In case it is a micro-enterprise based group as well, it

may take some more time to become self-sustainable. This is so

because it has to depend on many external factors like capital

mobilization, procurement of demand for its goods and services,

procurement of raw material, operationalization of the

production process, marketing of goods or services, etc.

Whatever type of a self-help group is, this is the time when the

agency needs to operationalize its phasing-out strategy.

Phasing-out is a strategic need for the project to enable the

group to function in a self reliant and mature way. It is a

weaning process whereby the agency reduces even its advisory

role to the group to the bare minimum and, depending upon

factors like nature, resources, strength, maturity level, etc. of

the group, this may take 6-12 months to complete for each self-

help group.

Group’s Behavior

At this stage, the behavior of the group becomes more focused

and stable. Individual differences based on out-of-the-group

alliances do not surface in their collaborative effort as members

of a group. This is because of the realization of the fact that in

an optimally functioning group, each member’s interest is

T


68

directly or indirectly supported by the other member’s interest,

i.e., the mature group has a greater congruence between the

individual and the group interest.

Attendance in the group meetings is consistently high and there

are few members holding back from participating in the group

activities. A few of the important changes in the group and in

the individual members that characterize the self help group

attaining maturity in their respective capacities are shown in

the following table: –

S.N Characteristics of a Mature Self Help Group

Changes in the Members’ Behavior

1. Transparent and democratic

leadership.

Responsible behavior as a

member of group.

2. Enhanced ability to take

collective decisions

Keen to participate in all group

tasks, decisions, and activities.

3. Enhanced ability to resolve

intra-group conflicts and

differences.

Better able to correlate between

the individual and group goals.

4. Enhanced adherence to group

norms in all matters.

Able to meet requirements for

credit rotation, savings and

other needs of group based

activities.

5. Better maintenance of the

group’s accounts; able to

anticipate financial needs,

and plan actions to meet

them.

Increase in income/welfare in

the case of members.


69

S.N Characteristics of a Mature

Self Help Group

Changes in the Members’

Behavior

6. Self-reliance in socio-

economic matters, least

dependence on the promoting

agency.

Gains a say in the family’s

socio-economic matters and

takes important decisions.

7. Identity in the community as

a social entity.

Gains self-respect and dignity

in her family and the

community.

8. Productive linkages with

outside agencies like bank,

NGOs, PRIs, govt.

institutions.

Gains confidence to interact

with outside people and

institutions.


Facilitate a performance review exercise in the group and

help the members analyze their achievements and failures.

Help the group to take on a long-term planning exercise for

ensuring its socio-economic viability in future.

Encourage the group to relate itself to the larger community

issues around them. This will broaden its scope of

functioning and win them the favor of the community.

Organize refresher training for the group around the subjects

of leadership, group management, record keeping, program

planning, and financial monitoring.


70

Help the group in its registration process if it so decides or if

it is in the interest of the group’s proposed future activities.

Share the agency’s phase-out plan with the group. Apprise

them of its probable fall-outs, both positive and negative.

Explain to them why it is necessary for the agency to pull

itself out and how it is in the interest of the group itself.

Reduce your field visits accordingly.


71

EXERCISES

1. Hold a session to motivate the potential group members and

seed in them the idea of self-help.

[Process: during the early stage of group formation, members are normally very tentative and hesitate to associate as a group. They may have various reservations also about the idea of self-help. All

the activities during the early stage of the group building process, therefore, should be directed towards motivating and mobilizing the potential group members and seeding in them the idea of self-

help so that they may relate their individual objectives with those of the group and as a result, recognize the importance of

collective effort. Methods like story telling, case presentation, or citing examples

from our surroundings such as the Beehive and the Anthill work well for a session of this kind and at this stage of group

development as they generate interest among the listeners and serve the message effectively. A few stories are given below, which you may use for this purpose.]

The Story of the Birds and the Net: once a flock of birds were trapped in a net laid out by a hunter. They vigorously tried for

long to escape from the net, but failed. Soon, they saw the hunter coming up to them and sensed the bell of doom ringing. At that

moment of trepidation, one of them had a brilliant idea, which it shared with the rest. As the hunter drew nearer, they all flapped their wings in tandem and flew away with the net.

The Story of the Blind and the Lame: there lived in a village two friends, one of whom was blind and the other lame. Once, a

nasty fire broke in their village, forcing all the villagers to run away to a safer place. However, the two could not run as the

blind was unable to see and the lame was unable to move. Suddenly, a brilliant idea flashed in their mind. The blind lifted his friend on his back and started running while the lame showed

his friend the way. Thus, acting together they found a way out and saved their precious lives.

Notes for the Trainer:

Stories must be told in a lucid way to enable the listeners understand them well.

Elaborate wherever necessary.


72

Elicit responses from the participants and initiate discussions

around the message of the story, relating them to the concept of self-help.

Draw their attention to the usefulness of organized and

collective effort, which a group is meant for.

2. Hold a session to enable the members understand the

importance of regular savings in the SHG and highlight its role in providing them an opportunity to save and use their

own savings to meet their immediate credit needs.

[Process: regular savings by the members to pool in resources

into the group’s common fund is what creates a nucleus around which the future transactions of the group revolve. Practice of regular savings therefore is a very important activity of a self-help

group, which needs to be stressed duly. You may take help of the following guidelines to hold a session on this.]

Learning Method:

Brainstorming,

Group Discussion and Guided Dialogue

Key Questions:

Why do the poor borrow? For what purposes did you borrow

money during the last one year?

Probable answers are: food, clothing, marriage, house

repair/construction, death, health, household expenses, farming cattle, agricultural inputs, ceremonies, travel, education, old debt clearance, etc.

What will be an ideal source of credit for the poor? What are your expectations of credit conditions when you approach

somebody for a loan?

Probable answers are: that, which lends small amounts of

money, provides timely credit, and provides credit at non-exploitative interest rates without requiring formal security or collateral


73

What are the available credit sources in your village or

community?

Probable answers are: landowners, big farmers, pawnbrokers, local mahajan, friends and relatives, bank, cooperative societies, private financial institutions, etc.

What are their disadvantages according to you?

Probable answers are: high rate of interest; need for security, guarantor, mortgage, or collateral; harassment on non-payment or delay in payment; risk of losing property, exploitation, or bonded labor; not timely available, expensive, or lot of paper work; presence of middlemen, only for members, only big loans available; etc.

Session Guide:

Give brief about the focus and the purpose of the meeting.

Put the key questions before the participants one by one.

Initiate a discussion on each issue/question by involving all.

Elicit the answers from the participants and list them out on a

chart. Add your own input against each list (take help of the list of probable answers for each question).

In case majority of their credit needs are for consumption purposes, discuss why this is so and what implications it may

have.

Lead them to reflect upon how an SHG can prove to be an

ideal instrument for their savings and credit needs by meeting all the requirements of an ideal credit delivery system. Also,

facilitate them to conclude that this is possible only when the group has its own common fund generated by the members’ own regular savings.


The poor often borrow small amount of money for meeting their daily needs. They need credit that is timely available at

non-exploitative interest rate and without collateral or security.

An analysis of the locally available credit sources will reveal their disadvantages in the context of the credit needs of the

poor.

An SHG has all the features, which are essential for a suitable

credit system meant for the poor.


74

3. Hold a game session with the participants to explain the

importance of goal setting for the sustainability of a self-help group

[Process: most of us live our life far below our capacity. Like the stray bits of woods, we float passively on the surface of a river,

allowing the currents to steer us here and there without any aim of our own.

Setting goals for ourselves can free us from aimless floating on the river and help us to give meaning and direction to our

endeavors and pursuits. It also helps us to use and develop our potentials, resources, energies, and time more effectively. The

same is true in the context of a self-help group, which exists to accomplish such goals and objectives as are beneficial to all its members.

However, it is necessary that our goals are both challenging and realistic. A less challenging goal may not be attractive enough to

enthuse the members. Similarly, an unrealistic goal is very likely to lead the group to frustration and disappointment in case it is

not achieved. Therefore, while helping the group to set goals for it, it is quite necessary to tell it that the goals should be “SMART” in characteristics. Following table explains the meaning of

‘SMART’.

To further explain the concept and the importance of goal setting

in a self-help group, the trainer may take help of methods like story telling, role-play, brainstorming, or a game-based exercise.

Necessary outlines of a structured exercise “Ring-Toss” are given below.]

S Specific

M Measurable

A Achievable and action-oriented

R Relevant

T Time & Resource bound


75

Objectives

To help the group to learn the importance of

setting ‘SMART’ goals.

To help the group develop an attitude for taking

calculated risk for achieving its goal.

Time Three hours

Materials

Drawing sheet, sketch pens, number cards from

1 to 10, an iron ring, and a wooden plank with a fixed stick at one end of it.

Method

Structure exercise and individual and group reflection.

Session Guide:

Keep the wooden plank (with a stick attached to one end of it) at one end of the session hall.

Place the numbered cardboards on the plank in ascending order from the stick end (as shown in the figure below).

Allow a 2 feet distance between the cardboards.

Each participant will be given a ring.

The task for each participant is to throw the ring in such a way that it circles the stick.

Each one would be given three turns. In each turn, one has to throw the ring three times from the chosen number of

standpoint.

10 9 8 7 6 5 4 3 2 1

Wooden Plank

Toss Ring Stick


76

Before the start of each turn, the participant has to decide and

note down a particular number of standpoint (from 1 to 10) from where she would throw the ring and how many times out of the three she expects to succeed in circling the stick.

Having chosen a particular number, s/he has to throw the ring from that number only for all the three times of that turn.

However, in the next turn, she may change the number of her standpoint.

After each turn, the participants have to write down their feelings about their efforts, success, and failure. Success

means circling the ring; failure means failing to do so.

Prepare a chart/table showing the following findings:

► The point and number from where the participant throws the ring in each turn

► Whether the participant in consideration changes her

standpoints in successive turns

► On what number of attempts she had expected to succeed

and on what she succeeded actually.


The number that the participant selects as her standpoint to throw the ring and the way one plans it is most important as it

shows the participant’s level of achievement motivation, ability to take calculated risk, and the planning pattern employed.

Standing on numbers 1-3 and getting success is a very easy job, where only a little amount of risk is involved. Throwing the ring from points 4 & 5 involves moderate risk; any number beyond

that involves higher risks of failure. In setting any goal for us, we need to balance the element of challenge with a realistic assessment of the situation.

4. Organize a session to help participants gain familiarity with

the basic steps involved in a planning exercise.

[Process: Planning may be defined as a process of identifying a set of problems, goals, and objectives and determining the best course of action out of many for achieving the fulfillment of those

problems, goals, and objectives. In the context of formation and development of a self-help group, a field worker often requires

planning inputs and activities to match field situations and to meet the requirements of the group he is working with. Simple


77

acts of planning may be used in identifying specific needs of the group at different stages of development, mobilizing necessary

resources, anticipating possible constraints, and ways to overcome them. However, people working directly in the field are

prone to be taken over by the immediateness of their situations, which may result in their jumping into action without any planning for it. It may work well at times, however, at others, it

may not. It is therefore desirable that they are given some orientation into the very act and process of planning. Following exercise may be used for this purpose.]

Session Guide:

Divide the participants into two sub groups.

Give both subgroups the following task to accomplish:

Participants are to suppose that they are the members of a

farmers’ delegation that is going to press its demands with the state level officials for better power supply during the day

hours to irrigate fields adequately.

The appointed time for the meeting is 10 o’clock in the

morning and the place where they have to meet the officials is about 100 kms from their village.

Going by the local bus, they cannot reach the venue in time

and would miss the meeting.

Hiring a conveyance exceeds the available budget.

Going by the train, which is a cheaper option, brings them to

the town a night before the scheduled meeting and in this case, they require arranging for night stay.

The task before each group is to come out with a definite plan

as to how it will make to the scheduled meeting in time. Ask each group to make a presentation before the larger group.


What was the task before each group to accomplish?

What were the problems in accomplishing that task?

What are your reasons for choosing a particular plan to fulfill

the task?

Do you think there are more ways to accomplish the same

task?

What if things turned out to be different from what you

speculated?


78


Tell the participants that things happen in a sequence even if

we are not aware of it. The process of planning helps us understand that sequence and adopt or redesign it as per the

needs of target achievement.

Lead the participants to reflect upon the process and steps

involved in arriving at a decision about a particular plan for target achievement.

5. Organize a visit of the group members to a nearby self-help

group, which is operational in an ideal way.

[Process: opportunities to interact with other SHG members and learn about how they are functioning and managing affairs

provide a useful learning experience to the newly formed group. Besides being an off-the-routine activity and drawing members’

attention therefore, it serves to motivate them to fare as well or even better as a group. Following guidelines would help you to organize an exposure visit for your participants.]

Learning Method:

Mutual Interaction

Discussion in Small groups

Note to the Trainer

Ensure that the process includes the following steps

Analyzing a situation

Setting a target

Mapping activities

Anticipating problems

Assessing and mobilizing resources

Generating alternatives and options

Selecting an option


79

Session Guide:

Chose a well functioning SHG situated nearby.

Inform them of your visit plan and its purpose.

Brief them on the general background of the new SHG.

Inform the new SHG also of your visit plan and its purpose.

Let the members of the younger and older SHGs introduce

them by exchanging names and details about their families, occupations, and the areas they belong.

Form groups of four with two members from the younger and two from the older groups each.

Assign each group the task of discussing and sharing information around the issues shown under the ‘key issues’

head.

Let the discussion run for about an hour.

Call the small groups back and ask them to report their discussions to the entire group one by one.

Help each group to focus its presentation on the strengths and the weaknesses of the two groups identified during the group

task.

Ask the members of the younger group how they feel about

their group compared to the older one?

Help both the groups, especially the younger one, synthesize

their plans to further strengthen their positive features and improve upon the negative ones.

Key Issues to be discussed by the Small Groups:

Why did you form a group? Who initiated the process?

What are your group’s achievements so far? How has it been

useful to the members?

How much savings your group has raised? What are the

differences in savings pattern?

How are loans issued? What norms are agreed upon for

loaning and repayment? What have been the maximum and minimum loan amounts issued so far and for what purposes?

What is the rate of interest chargeable on the loan? How did you decide it?

Have there been any defaulters? How were they dealt with?


80

What are the different roles and responsibility of members and

leaders?

What problems and challenges has each group faced so far

and how were they resolved?

What are your future plans?

6. Organize a session with the purpose of strengthening

interpersonal relationship among the group members.

[Process: good interpersonal relationship among the members is a key factor in ensuring a cohesive group and its smooth

functioning. This is more so when the group is still in the process of development and consolidation. Following session undertakes to focus on this.]

Session Guide:

Let each member share the following information with the group.

► Details about her family and any present problem or

concern facing the family.

► Moments of happiness and sadness related to their association with the group.

Use the following introduction to smoothly carry on further

interaction and to positively influence the attitudes and feelings of the members.

“For sometime now, we have been functioning as a group. It is not always possible to get along smoothly even in family relationships between husband and wife, mother and

daughter, etc. So, during this much time in the group, as in any other relationship, definitely we should have stored away some memories of very happy moments, and may be a few

unhappy ones as well. Let us share our feelings with others in the group, as it would serve the following purposes:

► It would help us to bring closer. We all know that sharing our happiness doubles our joy whereas sharing our

unhappiness reduces it half.


81

► It would help us to know if there are any misunderstandings among the members, so that we can

try to overcome them.

► In addition, it may encourage us to share our expectations

related to some relevant aspects of group functioning.”

Use the following questions to hear members’ feelings about

the group:

► Has the group helped you to resolve personal problems?

► How do you feel being in the group?

► Who are the members with whom you interact in your

group? Who do you trust most?

► Have there been any situations when the group supported

you? When and why?

► What has been your contribution to the group with respect to the group meeting, activities, development, and

promoting interaction among the members?

► What do you think the group expects from you? What is

your role in the group as perceived by you?

► What do you expect from the group and the group leaders?

► Have there been any situations where the group let you down? When and why?

► Did the group ever feel let down by you? When and why?


The purpose of the session is to promote sound human

relationships among the members. Though the situation may provide an opportunity to let out pent up emotions of members, it should not become a platform for hurling

accusations and counter accusations to justify any wrongs experienced in the past. The session therefore needs to be

handled very carefully.

While concluding the session, focus on the strengths of the

group, especially those emerged during the interaction.


82

Indicate the behaviors, which need to be modified.

Take individual commitments from the members that they would contribute their best to retain the strengths of the group

and to overcome the weaknesses.

Encourage the members to stand by each other in times of

need.

7. Hold a session to help one-year old groups to review and

reflect upon their performance so far and plan for future.

[Process: reviewing past activities and performances not only

allows the members to examine the group’s successes and failures but also provides useful cues for developing an action plan for the future development of the group. In addition, it

serves to fulfill the strategic need of the project management team and the group leaders. Therefore, a session to carry out this exercise will be very much in place.]

Trainee Group:

Twenty representatives of one-year-old SHGs (two each from

ten such groups)

Session Guide:

Inform the target group about the review meeting ahead of

time.

Ensure that they understand the purpose of the meeting.

Ask them to come to the meeting prepared with all necessary information.

After the introduction of the participants, divide the participants into four sub-groups of five members each.

Let the members of each group share with others the following information:

► Total savings of the group,

► Types of the savings,

► Credit generated,

► Variety of relationship among the members,


83

► Members’ participation in group activities such as meeting, decision-making, problem solving, etc.

► Leadership change,

► Problems faced by the group in the past one year and how

they were addressed.

Once the groups are over with their tasks, ask them each to

list out the ideal characteristics of a group.

Pool together the common points enlisted by them.

Now, let the members of the same sub-groups consider the achievements and performance of their SHGs in view of the

ideal characteristics identified by them.

Help them identify the strengths and weaknesses of their

group.

Afterwards, ask them to decide how they would improve upon

the weaker points of the group.

After half an hour, call the sub-groups for reporting to the

entire group.

End the session by debriefing the conclusions and

summarizing the outcome.


With regard to the plans and targets presented by the sub-

groups, check whether they are realistic.

Discuss the specific plans of the groups to achieve the fixed

targets for every aspect of groups functioning.


84

CHAPTER 4

Important Group Processes

e have discussed in detail some of the processes (like the

process of group formation). What is it that we call a

“process”, and how is it different from an activity?

A social process is the way a social group unfolds itself on its

way to a specific goal.

This unfolding may be a series of events, actions, or happenings

between an input and its output, or between an initiative and its

result.

This series of happenings may be natural, or a designed one, as

in the case of interventions made by a development agency.

W

Process “A”

Input or Initiative

“B” Output or Result

Interventions by the Dev.

Agency

Responses

shown by the Members


85

We may better understand the concept of a process with an

example where in a group situation not all the members start to

participate in group activities right from day one. It is only with

the passage of time, (due to the initiatives taken by the field-

worker and the willingness of the members) that their

participation increases. The movement from non-participation to

participation is a social process.

Therefore, in a group situation a process is the time and

manner in which a particular development of the group takes

place.

This process is generally an outcome of the planned

interventions made by the development agency and the

responses made by the members.

As a development worker, we are required to deal with and work

upon people for effecting certain changes in them and in their

living environment.

These changes cannot and should not be enforced or pushed

upon by any single method or rule; rather, they have to be

engineered organically so that they are accepted willingly.

Group at an

Early Stage

Group at a

Later Stage

Group at a

Much Later Stage

Process of Increase in Members’ Participation in a Group

High Participati-on of the Members

Very High Participati-on of the Members

Low Participati-on of the Members


86

Therefore, a group process is all about facilitating certain

changes in the group over a period of time, which contribute to

its functionality and sustainability.

This is often a time taking process whereby we act and patiently

wait for the results to come. Nevertheless, such a process of

change is key to the life of a group for generating strength and

cohesiveness among its members.

In the following sections a few important group processes like

participation, communication, and decision-making, have been

dealt with to widen the field-workers’ understanding about

them.

4.1 Participation

4.1.1. What is participation all about?

Participation is at the core of any group activity. A group

transacts only when the members participate in its tasks and

activities.

Participation is not a mere presence or the head count of the

members in a group meeting.

It is actually a process which ensures two things –– first, the

members’ identification with the objectives of the group and

second, willingness to accept their share of responsibility to

fulfill those objectives.


87

This identification and willingness on the part of the members

are often expressed in the interest shown in the activities of the

group.

As the degree of interest varies from member to member, so

does the degree of participation.

Depending upon a member’s degree of interest in the group’s

affairs, his or her level of participation may be termed as either

low or high.

Similarly, depending upon the degree of variation among the

members’ individual participation in the group’s affairs, the

overall participation level of the group at a particular point of

time may be termed as either low or high.

From this it can be inferred that the level of the group’s

overall participation is actually the sum total of all its

members’ participation in the activities of the group in

their individual capacity.

However, a good enabler and facilitator of the group ensures

that with the group’s onward journey to maturity, variation in

the degree of the members’ participation comes down to the

minimum possible.

Without a strong participation of the members in the group’s

activities, the viability of the group cannot stand for long.

4.1.2. Factors Influencing Members’ Participation in a

Group


88

In most rural societies in India the formalized group meeting is

not a common and familiar medium of social interaction for

women. Because of it being something new to them, it is very

likely that they experience stress and nervousness in a group

setting; hence, their participation may not come naturally.

There are many such factors – like social, cultural,

psychological, political, or economic in nature – as may affect a

particular member’s level of participation in group activities. For

a field worker, therefore, it is important that he or she

understands these issues well. A few important factors that

influence individual participation in group activities include:

(A) - Physical Atmosphere Of The Meeting Venue

The place where the group is holding its meeting or is engaged

in some group activities should be convenient and agreeable to

all. This is most important during the early stages of group

development when the members are yet hesitant in their

behavior and the cohesiveness of the group is not high. For

example, if the place is too hot or cold, or near some unsocial

place or at some place where women may feel constrained to

assemble, the participation level of the group will certainly

remain low.

Likewise, if the meeting is held at a particular member’s place

only and is not well rotated, or not held at a common place,

others may feel bad about it. The friendliness among the

members may, thus, be affected resulting in low group

participation.

(B) - Internal Atmosphere Of The Group


89

The internal atmosphere of the group is a very important issue,

which acts as a facilitative or inhibitive factor for the process of

group participation to evolve. The internal atmosphere of the

group is often influenced by the outside-the-group interactions

of the members carrying into their transactions within the

group. Therefore, the facilitator is supposed to know why

members interact differently with different members and initiate

processes that minimize such extraneous influences.

(C)- Importance And Nature Of The Group Task

Importance and nature of the group tasks also influence the

level of group participation. If the members are able to relate to

whatever is going on in the meeting or if they think it is useful

to them in some way, their interest automatically rises and it

results in better participation.

(D)- Composition Of The Group

Composition of the group is yet another factor influencing

members’ participation. Participation wise, a homogeneous

group is likely to perform better than a heterogeneous group.

Socio-economic differences or other differences rooted in the

members’ experience, age, culture, and education may create

divisions among the members, causing harm to the possibility of

uniform participation. Therefore, it is very necessary to ensure a

homogeneous group as far as possible.

(E) - Approach Of The Group Leaders

Group leaders approach and conduct towards their fellow

members are also very crucial in ensuring high participation

from the members. A sensible and careful approach on their


90

part works to promote harmony within the members, letting no

one feel sidelined or marginalized. Participation level in such a

group is generally high. Facilitators, therefore, have a role to

play in encouraging democratic practices and pattern in the

group.

(F) - Presence Of Outsiders/ Awe-Inspiring Personalities

Presence of outsiders in the group can adversely affect the

participation level of the members, more so when the group

does not know the outsider previously.

Similarly, in the presence of govt. officials like the village

pradhan or any other personality such as the district collector,

members may feel shy and hold back from interacting freely.

4.2 Communication

4.2.1. What is Communication all about?

In the preceding section, we learnt that participation is the

nucleus of all group activities, without which a group will have

only a notional identity. However, what is it that makes the

process of participation happen in a group?

It is communication. The process of communication in a group

runs parallel to the process of participation. Without meaningful

communication amongst members, there can be no actual

participation taking place.


91

In a specific sense, communication is to put across one’s

intentions and ideas to others so that others may understand

them exactly as one means them to be understood.

In a broader sense, however, communication is the way the

members of a group interact amongst themselves and with

outsiders.

All forms of communication may be divided into the following

components:

The conveyer (person who conveys something),

The receiver (person to whom something is conveyed),

The content (that which is conveyed),

The medium (instrument used to convey the content), and

The response (that which is responded as by the receiver)

No communication is complete in the absence of anyone of

these.

Depending upon the nature of its medium, communication

could either be verbal like the spoken words, or non-verbal like

one’s body language, behavior, or something written. As a group

process, both types of communication are equally important.

Like participation, the level and the scope for focused

communication within the group may be low during the initial

stages of group development. It is because of the lack of

familiarity among the members and the absence of a sense of

direction. As the group evolves, it develops clarity and sense of

direction resulting in enhanced possibility of communication.

4.2.2. Factors Influencing Effective Communication in a Group


92

Effective communication can take place only when what is

conveyed is understood as it is conveyed. For this, an

environment of ease and acceptance needs to be created.

Most of the problems of communication among the members are

rooted in the newness of the situation they face, the stress they

share, and the lack of understanding they have of one another

and of the group facilitator.

Therefore, it is necessary that during the early stages of group

development, everyone be given time and opportunity to discuss

their views freely and spontaneously with the facilitators and

other members. Such an exercise helps to promote interactions

among the members and enhances the level of communication

within the group.

Facilitators should also try to know each group member

individually, along with her family background. This enables the

members to correlate with the facilitator in a better way and

thus, overcome the anxiety and stress of the new situation they

are in.

Addressing the members by their names, like ‘Sarla Behen’,

‘Gita Behen’, etc., casts a very positive effect on the members’

psyche and they feel recognized in the group. It is therefore a

useful idea for the facilitator to learn their names as soon as

possible. It helps the members gain confidence to open up and

communicate more freely.

It is a general experience that initially members are unable to

express their ideas or understand other’s ideas clearly and

coherently. They even show little patience in waiting for their

turn to come and hasten into exclaiming their views and ideas


93

before others are through with their turn. This creates a sort of

disorder in the group and makes meaningful communication

difficult, if not impossible. Therefore, the group facilitator must,

in such cases, try to motivate the members to speak only one by

one.

The facilitator should identify the dominating and the passive

members in the group and work out a strategy to neutralize

these differences.

One way to neutralize this difference is to ask the members to

sit in a circle so that they are face-to-face with one another.

Background noises and side talks distract others and obstruct

the free flow of communication in the group. This must be

discouraged and stopped as soon as possible.

One of the reasons behind members’ reluctance towards not

sharing their views and ideas is their fear of rejection and

ridicule by others. This is more so during the initial stage of

group development when the members’ level of self-confidence is

low. The facilitator must, therefore, ensure that views of no

members are dismissed summarily even when they are extreme

in nature. A good way to deal with such extreme views is to

facilitate an open discussion on them and let the group itself

decide their non-acceptability.

4.3 Leadership, Decision Making, and Conflict

Resolution

4.3.1. What is Leadership?


94

A group life can be termed as a life of multiplicity expressed and

sustained in the unity of the group’s objectives. It is actually the

group’s objective, which acts as a unifying principle for the

multiplicity of its members. Seen this way, leadership can be

termed as the characterization of this principle of unification in

a few of its members who take, by turn, a leading role in the

management and functioning of the group.

Leadership is a quality, which enables a member to take on a

leading role in the attainment of the objectives of the group by

accepting more of the group’s tasks and representing the

group’s interest as a collective of all members. Therefore, a

leader is responsible towards attaining the objectives of the

group and maintaining his or her rapport with the members

both.

We may therefore say that a leader is a person who balances

between the task and relationship in a group. Only an emphasis

on relationship will not lead the group anywhere. Similarly, if

emphasis is given only on task, the group cannot be developed

and sustained.

If the leader functions with a low task and a low

relationship with group members, it indicates that he or she

is not taking sustained interest in the group task and at the

same time not inspiring the members. As a result, the group

lacks in spirit and a sense of achievement.

If the leader functions with low motivation for task, but

high relationship with the group, it indicates that he or she

is more worried about the relationship with the people and

less for the task achievement. As a result, the task of the


95

group is neglected and the members only enjoy appreciating and

patting each other. Such a group may appear strong from the

outside, but lack in actual strength.

Alternatively, if the leader functions with low relationship

with the group, but high task orientation, it indicates that

he or she gives more importance to task achievement, gets

all the work done through the members, and ends up with

taking all group decisions by himself or herself. As a result,

the members feel used and get frustrated with a high workload

and low personal relationship. Such a group may accomplish

the task, but may not enjoy the work.

In an ideal group, the leader functions with high task

achievement motivation and high relationship with the

members, signifying that he/she is committed to the group

task and concerned about the personal growth of the

members as well. As a result, the group becomes strong both

in the feelings of togetherness and in actual task achievement.

In a self-help group, leadership is generally represented by

office-bearers like the president or the chairperson, secretary,

and the treasurer; such positions should however be

democratically elected or unanimously nominated by the group

members themselves.

4.3.2. Role of Leadership in running a Self Help Group

The role of leadership in running a self-help group is very

critical for both its internal management and outside linkages.


96

Success of an SHG depends substantially on the kind of

leadership it has. Preferably, the group leaders should be

literate and able to communicate well. A sensitive, honest, and

democratic approach on their part is helpful in maintaining the

cohesiveness of the group. A leader, therefore, must be elected

by unanimous choice, as far as possible.

Group leaders have a very specific role in acting as a link

between the members and the facilitators of the group during

the days of group formation. In the absence of the agency’s

facilitators, they act as the group facilitators. When the agency

actually withdraws from the project by phasing itself out, much

of the onus of keeping the group intact is shifted on to the group

leaders.

Group leaders are supposed to ensure proper management of

the group by motivating the members to abide by all group

norms decided by the group collectively.

Another very important role of the group leaders is to develop

and maintain group’s productive associations with outside

agencies such as bank, village panchayat, district

administration, development agency, etc. to fulfill its objectives.

Group leaders also have to supervise the administrative work of

the group such as maintenance of financial and non-financial

records, convening and facilitating the group meetings,

executing the decisions taken by the group, etc.

In their role of enabler, the group leaders help the members in

solving their problems and working out plans.

4.3.3. What is Decision-making All about?


97

Like participation, communication, and leadership, decision-

making is also an on-going group process and a very important

one. It is important not only in a group situation but in all

situations of our life because all our actions are based on some

decision or the other.

A decision is a commitment towards a course of action based on

some need or consideration of the one who takes it. It may be an

individual decision or a collective one.

In the context of a group, however, decisions need to be either

taken collectively or at least consented to by a majority of the

members. Norms for decision-making are critical for the long-

term sustainability of the group.

During its course of life, a group needs to take decisions quite

often. It decides on many things concerning its internal and

external management.

Although a decision in a group is taken on the objective

considerations of its context, it cannot always be free of the

subjective biases, opinions, and mental makeup of the ones who

take it.

These biases and opinions are often the outcome of the

members’ own social, economic, and cultural influences, which

they acquire during their process of socialization.

Even facilitators may not be free from such biases and opinions.

However, because of their knowledge of this possibility they are

certainly in a better position to handle them. One of their jobs is

to help the group arrive at decisions through an objective


98

analysis of a situation and not by their own subjective

considerations.

Decision-making becomes difficult when there are many

alternatives or options to choose from, and different members in

the group feel differently about a particular option or choice.


99

4.3.4. What is a Conflict?

Agreements and disagreements are part of

a group’s life. Individual differences of

members necessitate differences in their

opinions, aspirations, attitudes, and disposition. Hence, there is

scope of divergence among the members on a particular issue.

However, when such differences become sharp and heightened

and start affecting the interest of the group as a whole, they need

our attention.

A conflict is a state of indecision in which different alternatives

of an action compete with one another for acceptance as the

best one.

The result of a conflict is always a split situation. Whether a

conflict is group based or member based, it weakens the group

as a cohesive unit; and in extreme cases, it may even lead the

group to disintegrate. It is, therefore, necessary that the

facilitators and the group leaders resolve conflicts properly.

4.3.5. Steps to Conflict Resolution

A conflict in a group situation is often a result of lack of

communication that denies members a shared vision and

understanding of a particular issue.

Therefore, the best way to resolve a group-based conflict is to

facilitate an open discussion on it so that all members

understand the problem in its right perspective.


100

The benefit of facilitating such a group discussion is that it

brings all the members face-to-face and makes them deal with

issues one by one in an explicit and open manner. At the end of

such conflict resolving sessions, a consensus is arrived at and

the conflict is resolved comparatively on a more permanent

basis.

Often an outside intervention (by the facilitator or leaders from

other groups) is required to resolve a particular conflict within a

group. Such instances and their multiplicity should, however,

remain as low as possible.

The following sequence of steps could serve as a model

sequence, which may be used by group facilitators and leaders

during their sessions on conflict resolution: -

(A) - Identification Of The Problem

Discussions are held first to identify the actual problem by

focusing on it and defining its boundaries. Many a time when

the problem is analyzed and made clear to all, they realize that

it was never a problem as such. It was only a misunderstanding

arising from miscommunication, which led them to believe the

issue differently.

The facilitator may also in his/her own humble way help the

members understand the issue in right perspective. S/he even

needs, at times, to steer the discussion so that it may not

become another exercise of unforgiving stances of the disputing

members.


101

Once the exact nature of the problem is identified by the

members’ own analysis, they stop defending it anymore and

show eagerness for finding a reasonable solution.

(B) - Identification Of Alternatives

As problems can be many, so can their solutions. Therefore,

there are always more ways than one in which a problem or an

issue can be solved.

It is always a good practice to define the alternative solutions of

a problem before arriving at the final one. Such options come

naturally when we think about an issue or a problem in a

democratic manner, involving everyone’s participation and

opinion.

(C)- Selection Of The Most Appropriate Alternative

Once the group has identified all available options to a problem,

what remains to be done is to select the most suitable one out of

them.

This could be done by a cost benefit analysis or by a simple

ranking exercise. A ranking exercise will mean counting of the

major advantages and disadvantages of a solution, making

comparisons among the advantages and disadvantages, and

assigning them a rank accordingly.

There may be situations where even a general reflection upon

the possible alternatives will give a clue to the most appropriate

one.


102

(D) - Implementation Of The Solution

After an alternative is chosen out of a few that are discussed,

the group goes ahead with implementing it as a solution to the

problem. The very act of choosing and implementing a solution

collectively serves to bolster the prospect of the group.

(E) - Evaluation And Verification

After an alternative has been implemented and tested for some

time, an assessment is made of its worth in solving the problem.

There is no harm in switching over to another alternative if the

one implemented fails to serve the purpose.

The same stepwise process as mentioned above can be used in

arriving at a consensus decision on any important issue in a

group.

A member-based conflict, however, can be resolved by offering

individual counseling to the member and paying her home

visits. Even in this case, the above stepwise process, with some

innovations, can be used by the facilitator to make her see

things in the right perspective and arrive at a decision.


103

EXERCISES

1. Hold a session to explain the concepts of process and

activity.

[Process: people react in a certain way to the changes that happen in and around their life. They either show approval and

acceptance for those changes or express reservations and resistance to them. In most cases however, they resist changes that are brought about in their life by an outside instrument or

agency. This makes the task of effecting changes in them and their ambience a difficult one, requiring a lot of interpersonal

skill, necessary conceptual inputs, and an unfailing patience above all. Therefore, a fieldworker working to promote formation and development of SHGs requires seeing the event of change

more as a process than as a function of input-output activity. Necessary conceptual inputs to explain the concepts of process

and activity are already given in the chapter, which you may use during your session. Following exercise is suggested to make the session more participatory.]

Session Guide:

Divide the group into three small groups.

Give them ten minutes time to reflect upon the following two

instances of social process – (1) The movement from non-participation to participation is a social process, and (2) the

movement from a less communicative group to a higher one is a social process.

Hold a brief session to introduce the related concepts of process and activity.

Ask all the groups to think of at least three such processes each.

Hold small group presentations and make a master list of all the processes identified by the groups.

End the session by highlighting the characteristics of a process and activity and their relevance in the group

development process.


104

2. Organize a session on participation and team building as a

group development process.

[Process: To highlight the attitudes needed for participation in group activity and to emphasize the need to focus on task and

relationships in teamwork, participants may be asked to play the game ‘Broken Square’, the outlines of which are given below]

Materials required: one set of Broken Squares, as shown below, for

each team of five.

Session Guide:

The exercise is carried out in silence within the stipulated

time.

Divide participants into teams of five players each.

Assign at least one observer to each team.

Mix each set of 15 pieces, and distribute three pieces at

random to each of the five players in each team.

The task before the five of the team is to form five perfect

squares. The task will not be considered complete unless each member in the team has in front of her a perfect square of the

same size as those of the other four.

If any piece is not of use to you then you can keep it in the

center.

Others can take only pieces that are left in the center.

No one can talk, signal, ask, or grab the pieces of paper.

Reflect upon the experience after the completion of the

exercise.

Request the observers and the participants to share their

observations and feelings.

6”

6”


105


Who was willing to give away pieces of the puzzle?

Was there anyone who continually struggled with the pieces

but was unwilling to give any or all of them away/

Was anyone in the group frustrated?

Did anyone finish his/her puzzle and then separate from the

rest of group?

Was there any critical point when the group began to

cooperate?

Did anyone try to break the rules by talking or pointing?

3. Hold a session to enable the participants to understand the

bottlenecks in communication and to emphasize the need to

understand the language and the feelings of other persons during the process of communication

[Process: role of effective communication within and outside the

group needs to be emphasized by a suitable game or exercise, which not only helps to grasp the idea in a much better way but also serves as an instrument to open up the participants and

enhance the prospects of effective communication among them. Outlines of such a game are given below]

Name of the game:

‘Do it correctly’

Materials required:

Blackboard, two sets of 12 identical objects

Session Guide:

Invite two volunteers, say “A” and “B”, from the group.

Instruct them to sit facing each other at a distance of 5 feet.

Place a blackboard or hang a curtain between them in such a way that they cannot see each other.


106

“A” “B”

Place one set of identical objects before each volunteer.

Arrange the set of “A” in a particular way or design.

The task for “A” is to communicate to “B” the pattern of her

set’s design in such a way that “B” also arranges her set in the same manner, however without having a look at A’s set.

The task for “B” is to arrange her set, without having to see A’s

set, exactly in the manner the set of “A” is arranged.

The rule at this point of game is that “B” will not ask any question from “A” while performing her task. Other group

members also will only observe the process and will not communicate by either speaking or making gesture among themselves or to the two volunteers.

Give 10 minute’s time for the task. However, tell them that they can take more time if they wanted.

Record the time taken for completing the task.

After the time is over, ask “A” as to how many pieces “B” would

have placed correctly following her instructions and note it down.

Similarly, ask “B” as to how many pieces she thinks she would have placed correctly and note it down.

Verify the actual number of objects placed correctly by comparing the set of “A” and “B”.

Go in for another round of the same game. However, change the process slightly this time. Ask “A” to arrange the objects

herself in any particular design she may like, but certainly different from the first one.

Ask “A” to communicate her design of set to “B”. “A” can do this either while arranging her set or after she has arranged it.

However, this time “B” can ask “A” any query or question which may help her in her task. Even “A” can clarify her

doubts while passing on instructions to “B”.


107

Again, give 10 minute’s time for the task. However, tell them

that they can take more time if they wanted.

Record the time taken for completing the task.

Ask “A” as to how many pieces “B” would have placed correctly this time following her instructions. Note it down.

Similarly, ask “B” as to how many pieces she thinks she would have placed correctly this time and note it down.

Verify the actual number of objects placed correctly by comparing the set of “A” and “B”.


Observe the body language of the persons doing the task.

Advise the participants to express their observations on

performing the task with regard to obstacles and facility experienced during the both rounds.

Bring out to the group the learning generated by this exercise

on one-way and two-way communications.

In general, the success rate of the second round is higher than

that of the first round because of the possibility of a two-way communication.

This exercise also emphasizes upon the fact that the absence

of eye contact makes communication comparatively difficult.

4. Organize a session to emphasize the need for leadership role

in the group and to enable the participants to know about different leadership styles and their effects on the group.

[Process: often due to an excessive dependency on agency’s field

worker, or other internal factors such as mistrust among the members, sub-groupism, etc, emergence of internal leadership in an SHG is unfortunately stalled. Group’s own leadership,

therefore, needs to be encouraged and promoted from the beginning so that it may become self-managed and sustainable in due course. Following exercises may help the trainer to hold a

session required as above.]


108

Exercise – I

Objectives

To enable the participants to understand who is a leader and why leadership is required for an SHG.

Learning Method

Creative reflection and Brainstorming

Session Guide:

Divide the group into three smaller groups.

Give each group 30 minutes time to reflect upon who is a

leader and why leadership is required for an SHG.

Ask each group to fill in the following table by completing the

following two sentences in at least 5 different ways-

1 A leader is…

1

2

3

4

5

2 Leadership is needed so as to…

1

2

3

4

5

Ask all the groups to present their lists to the larger group

one-by-one.

With the help of all the three lists, prepare a master list.


109

Notes to the trainer:

Ensure that the master list includes the following items: -

1 A leader is…

1 The most responsible person in the group.

2 The person who inspires the individuals and the group for

attaining the group objectives.

3

The person who facilitates a

process of growth among the members and the group.

4 The person who becomes a living example for the group by doing things herself.

5 The person who balances between task and relationship in the group.

2

Leadership is needed so

as to…

1 Monitor and improve upon the group’s performance.

2 Coordinate all group activities.

3 Nurture the group’s inter-personal

relationship.

4 Ensure that all members in the

group activities.

5 Take initiative in establishing

linkages with external agencies.

6 Provide strategic direction to the group.

7 Represent the SHG in various bodies like federations, etc.

8 Express and interpret the group’s vision.


110

Exercise – II

Objectives

To enable the participants to get familiar with different leadership styles.

Materials Chart paper

Markers

Four glass tumblers

Water, Sugar, Clay, and a big Pebble.

Learning Method

Demonstration

Reflection

Sub-group discussion.

Session Guide:

Take four glass tumblers and fill them with water.

Ask the participants to put the pebble, water, the wet clay, and the sugar in all the four glasses separately.

Ask them to explain what happened in each case.


In each case, water represents a group.

The pebble represents an autocratic leader, who is dominating

and does not mingle with the water.

Second instance, in which water is added to the water filled

tumbler, represents the effects of a dummy leader on a group; there is no difference between the leader and the others in the

group.

The wet clay in the third instance represents an anarchic

leader who spoils the group by promoting chaos and dissidence, like it spoilt the water by making it muddy.

The sugar in the fourth instance represents a democratic and participatory leader. As the sugar mingles in the water and

sweetens its flavor so does a democratic leader mingles with the group and enhances its quality.


111

5. Organize a session to explain the process involved in

decision-making.

[Process: decision-making is an important group process, which characterizes the level of maturity the group has reached in terms

of cohesiveness among the members and democratization of group norms and practices. Often a group with many sub-groups

within it tends to develop problems with regard to reaching consensus and taking decisions on any issue of common interest, affecting adversely the development of group as a self-managed

entity. There may be other factors that can affect the decision-making ability of the group. Therefore, it is important to

understand the process and importance of decision-making in the context of Self-help group. A suggestive exercise is given below which may be used in a session on decision-making.]

Name of the game:

‘Flood in a Village’

Method:

Experiential Learning

Situation:

Certain village is invaded by flood.

Most of the houses are affected. However, a few of them are

totally submerged and people numbering 10 are trapped on the rooftops.

These people include a twelve-year girl who is blind and has to

participate in a national program shortly,

A pregnant woman who is unmarried,

A 60-year-old priest of a famous temple,

A young and brilliant doctor who has decided to work in the village,

The owner of a nearby shoe factory where many people from this village are employed,

A local moneylender who has always lent money to the village people, though on his own terms,

A local panchayat member who is a dedicated development worker,


112

A schoolteacher who spent all his life in bringing education to

the village,

The daughter of the same schoolteacher, who is to get married

very shortly,

A woman health worker who is very dutiful.

All the 10 members are shouting for help.

There is only one small ferry, which can be used to bail the

trapped people out.

However, the maximum loading capacity of the ferry is only

eight including two oarsmen to row the boat.

It means only six from the trapped ones can be sailed at a time

to a safe place.

The possibility of a second round ferrying is very low.

Therefore, the task before the group is to decide who are the

six members they would prefer unanimously to rescue.


Observe how the group reaches a unanimous agreement over

the issue.

Is the decision really a unanimous one? Or, is it a decision of

majority?

See if any member had any disagreement with the decision of

the group, but had to give in before the group pressure? What were those pressures?

Find out if any compromise was made between any members for reaching a consensus?

Who are members who most influenced the group’s decision-making process?

Who are members who remained passive and only consented to whatever decision the group arrived at?

Who are the members who always opposed whatever decision the group wanted to arrive at?

After the exercise, hold a session with the group to reflect upon the whole process.

Debrief the group on various angles and dynamics of decision-making process.


113

6. Hold a session to explain what a conflict is and how it arises.

[Process: conflicts are inevitable in the life of a group as no two persons are alike and hence, differences and disagreements may arise out of differences in life experiences, attitudes, and

expectations of the members. There are many other factors such as poor communication, lack of mutual trust, heterogeneous

group composition, etc, which may further reinforce conflict. Therefore, it important to understand what conflict is and how it arises. Equally important is to know how a conflict can be

resolved. Following exercise serves to focus on enhancing participants’ understanding of conflict and common reasons

behind a conflict situation.] Name of the Game:

The Tea Cup

Session Guide:

Ask participants to sit in a circle.

Place an empty teacup in the center of the circle.

Ask each participant on which side of the cup its handle is

fixed.


Different participants would answer differently about the

location of the handle on the cup. Some would say it is on the left, some on the right, others may not see the handle at all,

and yet a few others would find it right in front of them.

Initiate a discussion on who is right and who is wrong.

Tell the group that there is no single correct answer to the above question.

Discuss with the group that differences in situation and persons’ background influence their perception, which, if go

unacknowledged, result in a conflict situation.


114

CHAPTER 5

Management and Functioning of an SHG

group’s future depends much on how the group members

manage its affairs in both its internal and external

working. In this chapter, we will cover different dimensions of

managing a self-help group.

5.1 What happens in a Routine SHG Meeting

A very natural question, which may come to the mind of the

people not familiar with a formalized and structured group life is

that what exactly happens during a routine self help group

meeting. What business is done and how is it done?

Similar questions may trouble the mind of someone who is to

take up the job of a group facilitator in an SHG development

program. To answer this issue, an outline of the transactions,

which can take place in a routine SHG meeting, has been

rendered below.

5.1.1 After brief exchange, the minutes of the previous meeting are

read out by one of the office-bearers, preferably the secretary or

the accountant. This is done to recall important issues of the

previous meeting and the decisions taken thereupon.

A


115

5.1.2 The group then sits to record the attendance of the members in

the attendance register. Any problem to be sorted out or any

group norm to be formulated is then taken up for discussion.

Decisions taken thereafter are recorded in the minute’s book.

5.1.3 Members deposit their stipulated savings with the treasurer or

the accountant who records corresponding entries in the

group’s savings register and the members’ passbooks. Fines for

previous absence of stipulated payment, if any, are collected

and recorded in a separate register, may be called a penalty

register.

5.1.4 Individual loan repayment schedules are reviewed and loan

repayments from the members are collected. Entries are made

in the loan recovery register and the individual members’ loan

passbook. Non-repayment of loan from any member is

discussed in the group and reasons given by her are analyzed.

Accordingly, the group takes a decision and, as per the norms, a

penalty is imposed and recorded in the penalty register and the

members loan passbook.

The group leaders and the facilitators may initiate a discussion

on the issue of non-repayment of loan by the members and its

negative implications on the well being of the entire group. Such

an exercise helps in maintaining the transparency in financial

matters and at the same time exerts a pressure on the

borrowers to maintain their repayment schedule.

5.1.5 Fresh requisitions for loan from the members are entertained.

The purpose, amount, and repayment schedule of the loan are

examined and analyzed. Corrections, if any, are suggested and

the loans are sanctioned.


116

In case the available group fund is less than the total amount

requisitioned as loan, some sort of prioritization, rationalization,

or rationing of the application is done in compliance with the

group norms.

Alternatively, however, if there is a case of under utilization of

the group fund by the members and there is a low demand for a

loan, the possible causes of low fund utilization are discussed

and analyzed. The best use for the surplus group funds is then

discussed.

5.1.6 The fresh borrowers are again told about the terms of the loans

they have been advanced and the schedules of repayments they

are to follow. All the remaining formalities like updating the

records, getting the signatures or the thumb impressions of the

borrowers, etc. are completed and the loans are finally

disbursed.

5.1.7 Loan requirements of the members for the future meetings are

noted down and repayment obligations for the next meeting are

announced.

5.1.8 The group then takes up several issues/problems for a longer

and more in-depth discussion. Each member’s suggestion is

taken in and one to three issues are then prioritized for

discussion. No limits should be put on what kind of issues are

taken up for discussion. This is critical if the group is to have a

social base, in addition to a financial base for its sustainability.


117

5.1.9 The secretary sums up the day’s proceedings by reading out all

transactions and decisions that took place during the meeting.

The day, time, and venue for the next meeting is fixed.

5.1.10 Members sign or place thumb impressions in the minutes’ book

to record their presence and consent to the transactions that

took place. The meeting is thereafter closed and the members

disperse.

5.2 Framing Norms

roup norms serve as parameters to validate or invalidate a

group activity. They are guidelines for the functioning of

the group in all its transactions. Norm setting, therefore, forms

the core of a functioning self-help group.

Framing of group norms is actually an essential feature of the

group development process, signifying growth in members’

ability to take collective decisions for framing, accepting, and

implementing a set of rules for them. As the group evolves in its

image of an organized body, so does its commitment to the

norms it sets for itself.

An important thing to keep in mind is that rules or norms,

whatever importance they may hold, should never be imposed

upon the group; instead, the group should be helped and

facilitated to make its own rules and norms in a natural way

without any outside pressure. The group should be left free to

learn and modify them through its own experience.

G


118

In the following sections, important group norms have been

mentioned to give an idea about the types of norms that should

normally emerge in a functioning SHG.


119

5.2.1 Norms for Timing, Frequency, and Venue of the

Meeting

Issues to be decided include:

Decide when the group meeting shall be held – whether in the

morning or evening,

Whether on weekly, fortnightly, or monthly basis,

Whether at a member’s house or at a common place,

Decide the degree and conditions of flexibility the group may

have in these regards.

5.2.2 Norms for Membership


What shall be the membership criteria for the new people

desirous of joining the group,

How the group will decide to grant or not to grant membership

to a new person – the mechanism to facilitate who in the group

will decide and on what grounds,


120

Whether the group will charge a membership fee from the new

member in view of the expenses already incurred by the group,

or

Whether a new member will have to deposit an amount of

money in the group’s common fund equal to the average saving

of an individual member at the time of her joining.

5.2.3 Norms for the Termination of Membership


What shall be the reasons for termination of a member from the

group and the process followed for allowing the termination,

What shall be the rule for any member leaving the group out of

her own choice,

Will the entire savings of the member be returned after

deducting or without deducting the member’s share of expense

on the group’s assets,

Will or will not any interest on her savings be paid, etc.

5.2.4 Norms for the Group Leaders



121

What names the office-bearers of the group will have –President,

Secretary, and Treasurer, or the Board of Directors. Specify

their maximum and the minimum number.

Specify the roles and responsibilities of all the office bearers

which the group will have,

What shall be the terms of office for the office-bearers – decide

in terms of months or years,

Define the process to choose the office-bearers – whether they

shall be selected, elected, or nominated,

Decide mechanism for keeping checks and balances on the

office-bearers – so that other members may cooperate with them

in their work and they themselves may discharge their duties

honestly.

5.2.5 Norms for Savings and On-lending among the

Members


Whether monthly savings should be uniform for all or variable

as per the individual member’s capacity,

When to start the rotation of group fund as loans to the

members,


122

Will the loans advanced to the members be proportional to their

savings,

Will there be a ceiling on the maximum or minimum loan size,

What shall be the rate of interest and schedule of repayment,

Will the group levy a service charge on each loan to meet the

transaction cost,

Will the group like to know the purpose of a loan sought by a

member and her repayment plans,

How will the group prioritize the credit needs of the members in

case there is paucity of group fund and surfeit of loan-demands,

How will the group ensure realization of the loan if any member

defaults?

5.2.6 Other Administrative Issues


Will the group like to fix any penalty for late attendance in the

meeting,

Non-attendance in the meeting, or

A member’s bad behavior with other members,


123

If yes, what shall be the mode of penalty, etc.


124

5.2.7 Reviewing and Modifying Group Norms

After framing and using the group norms for a specific period,

the group may feel a need to either change a norm or modify it

for better functionality and management of the group. The

group may even find that certain norms are not being adhered

to; hence, may like to discuss the reason of non-adherence.

Therefore, it is a good practice to call for a review meeting after a

certain period, say after three to six months, whatever is

suitable for a group in its own context and situation. Such a

need may not come from the members, as they may feel hesitant

about voicing their differences in the beginning. The facilitator

has to take such initiatives initially, and encourage and

motivate the members to become pro-active and vocal.

A few of the issues, which may be discussed in a group review

meeting, are indicated below: –

Would the group like to replace, change, or modify any of the

group norms it formulated for itself, like the rate of interest,

amount of mandatory savings, amount and mode of penalty for

the defaulters, etc.?

Is there any need to change a group leader or increase their

number for managing added group responsibilities?

Would the group like to reschedule the frequency, timing,

venue, etc. of its meetings?


125

There may be any number of such issues relevant to the group’s

integrity and cohesion.

5.3 System for Record Keeping and Accounting

ext in importance to framing and implementing norms is

creating a system of record keeping and accounting. No

transaction in a self-help group is left to memory or informal

noting, even though the majority of the members may not be

functionally or even minimally literate.

Functioning of an SHG can be compared to that of a small

cooperative bank meant for its members. As in a bank all

transactions are recorded in a system of a formalized and

structured database, so in an SHG all monetary and non-

monetary transactions are recorded in the books of accounts

and proceedings.

If no one in the group is literate enough to maintain the records,

services of a hired accountant or a record keeper may be sought

to do all that is needful.

Among the most commonly used books in an SHG are the cash-

book, members’ savings passbook, members’ loan book, ledger

book, penalty and fines register, stock register, members’

attendance register, and minutes’ book.

What records, books, and registers an SHG keeps would depend

upon its norms in this regard.

N


126

5.4 Control over the Common Fund of the Group

Functioning of an SHG revolves around raising a common fund

of the group and utilizing it to the best purposes of the group. It,

therefore, becomes important that the group has a control over

the common fund. Normally, in a group with an external book

writer there is a possibility that he/she starts handling the

money and thus creates unwarranted prying in the activities of

the group. Following practices may be observed by the group to

retain control over the common fund:

The one who writes the accounts should never handle the

money.

Members should develop a habit of keeping mental track of

their own individual savings, total group fund, and credit

status in the group.

Important financial figures should be announced at the end

of every meeting.

Members should ask the book writer to read out the day’s

minutes before they sign.

Members should ensure that all the books of accounts and

other records are always kept up-to-date.

Members should ensure that the books and records are not

kept in the custody of the book writer.


127

5.5 Mechanism for Information Flow within the

Group

universally found motive behind all initiatives for

promoting the formation and development of self help

groups of women is the intention to empower the poor women

who constitute a large portion of socially and economically

marginalized population of our society.

Hence, to keep this objective in focus during the course of an

SHG development project, it is necessary that the members are

encouraged and motivated to participate in the group activities

at all possible levels of program execution.

The objective of women’s empowerment and capacity building

within the frame of an SHG could be achieved through many

ways and means; one among them is sharing details and

information of group activities with one another so that

everything remains transparent and visible to every member.

Such a practice provides opportunities to every member for

being aware of the direction in which the group is moving.

Moreover, it promotes democratic and participatory functioning

of the group, which is essential for its long-term sustainability.

A free flow of information within the group can be instituted by

taking certain steps to ensure: –

That the members have direct access to the group related

financial information such as the composition and the status of

A


128

group fund, status of the group’s transactions with the bank

and NGO, etc.,

That members are aware of the information available in the trial

balance sheet such as the total available group fund and its

distribution, etc.,

That the members are aware of the entries in their savings

passbooks such as the amounts saved by them, interest

accrued on their savings, loan advanced if any, and penalty

paid, etc.,

That the members are aware of their repayment obligations as

entered in their loan passbooks, possible penalties in view of

defaulting, etc.,

That the members are aware of and familiar with the different

kinds of group records such as cash-book, ledger-book, minutes

book, etc and the kind of information they contain,

That the member do not feel diffident in asking the accountant

or the record-keeper to read out to them the financial and other

details of the transactions taking place in the group.

All the above-mentioned tabs are only indicative and not

exhaustive.


129

5.6 Monitoring and Review

onitoring is a continuous assessment of the group

activities with respect to the goals it has set for itself. It is

an ongoing assessment of the group’s progress to see whether

the same is happening in the right direction or not.

A review is a periodic assessment of the group to judge whether

it is operating as expected and whether any change at any level

has to be made to make it more effective and efficient.

Monitoring and review are the tools of internal management of

the group. Initially, it is the responsibility of the group

facilitators to steer the group on to the right course. However,

with the group getting older and mature, these functions are

passed on to the group itself where the group leaders assume

these responsibilities.

Basis of any monitoring and review activity of a group is its

goals and objectives, which are broken down into indicators for

this purpose.

Indicators are parameters to assess the degree of goal

achievement at a particular point of time in program execution.

They are like milestones which tell us whether we are moving in

the right direction or not, and if yes, how far we have moved,

and how far we have yet to move.

A few possible indicators for monitoring and reviewing a group

are given below: –

M


130

SN Indicator Trend

1 Members’ attendance

in group’s meetings

Increasing, decreasing, or static

2 Monthly savings Regular, not regular, very irregular

3 Income of the group Less than the group expenses, more than the group expenses

4 Repayments of loans by the members

Very timely, timely only in a few cases, untimely, untimely in a few cases

5 Defaulting Frequent, rare

6 Group fund utilization as loans to members

Maximum, 75%, 60%, 50%, less than 50%

7 Repayment to Bank Regular, not regular

Below are given a few checkpoints to judge the progress and

development of a self help group, which may be utilized by

group facilitators/leaders in designing and executing a review

exercise.

Do the members attend the meetings regularly? What is the

percentage of attendance – less than 50%, between 50% and

70%, 70% and above?

Do the members come in time for attending the meetings?

Does the group freely communicate with the group facilitator?

Do the members freely communicate among themselves?


131

Does the group take initiatives for organizing the group meeting

even when the facilitator is not present?

Has the group started pooling in regular savings?

Has the group chosen its leaders/has any leadership pattern

emerged in the group naturally?

Have all the group norms been framed and recorded?

Are all the norms set by the group being pursued rigorously?

Are all the members aware of these norms? Do they believe in

them?

Have the members started borrowing money from the group’s

common fund?

Is thorough processing being done before sanctioning a loan –

for example, is the loan-seeking member asked about the

purpose of the loan and the repayment schedule that she

envisages to follow?

Are all dues from the members such as interest on the borrowed

loan, repayment installments, penalties on defaulting – if any,

membership fee, etc. are coming on time?

Are the members showing collective responsibility for making a

follow-up of loan repayment, defaulting, etc.?


132

Has any conflict surfaced in the group? Has the group been able

to resolve the conflict by itself, or the facilitator had to

intervene?

Are all the group tasks such as keeping the group fund, group

records, stationery, etc. shared and rotated among the

members?

Are the group members aware of the financial position of the

group and their own individual standing in it, such as the total

group fund created, fund utilized by the members as loans,

their own individual savings, expenses of the group, balance,

etc.?

Are the members aware of different group records such as

cashbook, ledger book, passbook, minutes book, penalty

register, attendance register, etc.?

Is the accountant or the record keeper doing her/his job

accurately?

Has the group been exposed to the working of a bank?

Have any training program been organized by the intervening

agency to enhance various skills of the group members and

leaders such as planning, accounting, budgeting, etc.?

Has the group been taken on an exposure visit to a peer group?


133

Does the group hold its meetings even during the peak harvest

season?

Do the members ask to hear the day’s proceedings before

signing them?

Has the group now become stable on issues like membership,

group norms, leadership, viability, etc.?

All the above checkpoints are only indicative and not

exhaustive.

5.7 Registering a Group

egistering a group means making the group a formal and

legal entity.

Under prevailing regulations, informal groups (means

unregistered groups) are entitled to accept grants under

schemes like DWACRA, etc. and loans from banks under

NABARD’s scheme on SHG promotion. They can open an

account in a bank even without being registered.

Once a group is registered, it has to act in a formal way fulfilling

all legal obligations.

Therefore, for all practical reasons and to avoid unwarranted

interference from outside, it is always advisable to keep the

group informal as long as possible.

R


134

However, if the group has the potential to grow into a big one by

expanding both laterally and vertically in terms of volume and

kind of work, it may then have no other option but to get itself

registered. In such cases, it is desirable that the group goes in

for registration.


135

5.8 Federating the Groups

federation of self-help groups is an alliance, coalition, or a

union of a certain number of self-help groups based on a

mutually agreed agenda for the development and promotion of

self-help activities of the individual groups. In a sense, a

federation is an SHG of individual SHGs.

Depending upon the needs and the context of the aligning

groups, a federation can either be registered or unregistered.

Likewise, depending upon the kind of networking the groups

have opted for, a federation can either be a multi-layered

federation or a single-layered federation. Examples are given

below.

A

District Level Federation

State Level Federation

Apex Level Federation

Village Level Federation

Village level Alliance of SHGs

District Level Alliance of the

Village Level Federations

State Level Alliance of the

District Level Federations

National Level Alliance of the

State Level Federations

Multi-layered Federation


136

The question arises as to why are federations required or what

are the benefits of creating federations of SHGs? A few possible

reasons are given below:

The adage “unity is strength” applies here again. Federating a

number of SHGs run under the same project allows a forum of

them to be floated which acts as a stronger pressure group in

many ways.

As a collective, a federation can enhance individual SHGs’

capacity to bargain with the administration on issues

concerning their development and growth.

In case of undue delay in sanctioning of loans or any other bank

related matter, a federation of SHGs can facilitate the individual

SHG’s follow-up with bank officials.

Single-layered Federation

Federation of SHG

SHG SHG SHG

SHG SHG

SHG

SHG

SHG

SHG

SHG


137

A federation can serve to provide a platform to an individual

group to evaluate its problems and performances with respect to

those of other groups.

It also serves to provide alternative solutions to the problems of

an individual group, which it finds hard to solve on its own.

A federation eases substantially the work of a facilitator by

providing her/him access to a number of self-help groups

simultaneously. It saves valuable time and resources in

managing a project with a large number of groups.

A federation can also adopt and evolve a separate agenda for

itself to fulfill larger issues of the community.

5.9 Linkage with the Banking Institutions

Self- help groups of the poor owes their birth much to the denial

of the credit needs of the individual poor by formal financial

institutions like banks.

Formation and development of self-managed, self-help groups

was a natural response of the poor people to the structural

constraints of the society in which they lived, which denied

them, as individuals, access to banking services for fulfilling

their savings and credit needs.

Therefore, as a group, their linkage with the banking

institutions at some stage of the group’s development is a logical


138

step towards securing a means for fulfilling their savings and

credit needs on a larger scale.

5.9.1 The Need to Open an Account in a Bank

Apart from the justification of a general nature given above for

creating a linkage of the group with banking institutions, there

are a few specific considerations also, which necessitate the

running of the group’s account in a nearby bank. These are,

Opening an account of the group in a nearby bank is the first

step in building its linkage with the formal mainstream

system.

Banks provide a safe custody for the large sums of money,

which the group may not require to use immediately.

Keeping the group fund in a bank ensures transparency in

the financial dealings of the group and adds to its

trustworthiness among the members and the outsiders as

well.

5.9.2 Formalities Required for Opening an Account

There are a few basic formalities, which the group needs to

fulfill for opening an account in a bank. They are,

First of all, the group writes a resolution showing its

willingness to open a bank account,

In its resolution it names three members who will act as

signatories of the group’s account,


139

Finally, it submits to the bank a copy of the resolution along

with a photograph of the three signatories for the requested

bank account.

In case of any difficulties with the bank authorities in

opening the group’ account, the directives of the Reserve

Bank of India vide circular “RBI Circular DBOD: No. BC.

63/13:01:08:92-93, dated January 4, 1993 on the opening of

savings bank accounts in the name of Self Help Group” may

be consulted and referred to.

5.9.3 When to go in for External Funds?

A group may explore external sources to fulfill its credit needs.

These outside sources may include a grant from the supporting

agency or a loan from financial institutions.

However, before going in for any outside fund support, the

group needs to be well aware of the different aspects of fund

management and financial control, and the consequent

obligations and responsibilities that go with borrowing such

external funds.

Therefore, it is desirable that external funds are not pumped in

or sought by the group until it acquires familiarity with the

basics of group fund management and a clear need for external

funds by the group and its members.


140

EXERCISES

1. Hold a session to explain how to conduct an SHG meeting.

[Process: the best way to explain how to conduct an SHG meeting is to simulate such a meeting with the participants. Besides providing a practical experience of it, such an exercise helps to

gather important details about the way a meeting is conducted. Important guidelines for it are given below.]

Session Guide:

Ask the participants to sit in a circle.

Start the session with a prayer or a song.

Select a chairperson, secretary, and a treasurer from amongst

the participants for the simulated meeting.

Brief them of their roles in the context of an SHG in general

and in the context of the meeting in particular.

Facilitate a welcome address by one of the office bearers.

Record the attendance.

Facilitate a review of the previous meeting (a previous meeting

has to be imagined)

Ask one of the office-bearers to read the agenda of the meeting.

Initiate and complete financial transactions related to savings, repayment, lending, etc.

Ask one of the members, preferably the treasurer, or the accountant, to record the proceedings of the meeting.

Ensure that all issues on the agenda are discussed.

Facilitate everyone’s participation in the group transaction and

the process of decision-making.

Ask one of the participants to read out the proceedings of the meeting aloud.

Gather participants’ signature (representing members of an SHG) on the minutes’ book.

Fix the date, time, venue, and the agenda for the next meeting.

Facilitate a vote of thanks and end the meeting.

Hold a debriefing session.


141

Questions to be asked during the debriefing session:

Why was a circular seating arrangement followed, not a linear,

or any other arrangement (the group may experiment with holding a meeting with a linear or back-to-back seating

arrangement and note down its experiences)?

Why an agenda was fixed (the group may experiment with holding

a meeting without an agenda and note down its experiences)?

Why office bearers were nominated (again, the group may

experiment with holding a meeting without nominating any office bearer and note down its experiences)?

Why recording is necessary?

2. Hold a session to give participants an experience in framing

the group norms.

[Process: Group norms serve as guidelines for the functioning of

the group in all matters. They lay foundations for the day-to-day working of the group besides evincing details of its administrative

and managerial functioning. Hence, setting of group norm is an important task, which the group has to perform during the early days of its formation. Guidelines for a session on this are given

below.]

Learning Process and Methods:

Simulated group meeting,

Brainstorming, and

Group discussion.

Session Guide:

Brief the group of the purpose of the session.

Ask each of them to think over the following question and

come forward with an answer: “What do you mean by rules and regulations and why are they needed in a self-help group?” Give 10 minutes’ time for this purpose.

Write down all the responses of the participants.

Prepare a master list by removing repetitions and adding your

own inputs (examples may be given from our own


142

surroundings and neighborhoods such as the traffic rule, rules pertaining to the fair price shop, village schools, etc.)

Explain in detail the concepts of rules & regulations, and the role of norm setting in the functioning and management of an

SHG.

Now, ask them to simulate a group meeting as in the previous

session.

Facilitate the group to select a chairperson and a coordinator

from amongst them who will manage and steer the group discussion.

Ask the group to explore and enlist areas in which rules and regulations of the group need to be framed.

Ensure that discussions are shared among all the members so that all have a chance to speak.

Prepare the list suggested by the group members.

Ask participants to make a review of the rules suggested by

the group.

Incorporate if members suggest any modification.

Notes for the trainer:

Never impose any rule or norm upon the group; instead, help

and facilitate the group to make its own rules and norms naturally and without any outside pressure for it.

Encourage the group to learn and modify them through its

own experience.

Ensure that norms related to the following areas are included

in the final list prepared by the group:

► Norms for Timing, Frequency, and Venue of the Meetings

► Norms for Membership

► Norms for the Termination of Membership

► Norms for the Group Leaders/office bearers

► Norms for Savings and On-lending among the Members

► Other Administrative Issues and sanctions


143

► Reviewing and Modifying Group Norms

3. Organize a session to enable participants to process

members’ loan applications in an SHG meeting.

[Process: circulation of group fund among the members is a crucial function of an SHG. This fund is circulated as loans to individual members, which are paid back to the group in a

stipulated time and manner. Problems arises when demand for loan from the members is low, or when the accumulated group fund is less than the demand for loan, or when repayment of

advanced loan falls behind schedule or stops altogether. Therefore, it is important that participants understand the

procedure for processing and sanctioning of loan considerably well. Following session may be organized for this purpose.]

Session Guide:

Divide all the participants into three small groups A, B, and C.

Ask each group to simulate a group meeting as in previous

exercise.

Imagine that all the three groups have accumulated Rs. 5,000

as group fund through individual savings by the members.

In the group A, ask 3-4 members to come forward with a

demand for loan. See that the demand for loan is bigger than the accumulated group fund.

Ask the group to think over the way it will handle the situation and give 15 minutes’ time for this purpose.

In the group B, see that no members come forward with a demand for loan.

Ask the group to think over the way it will handle the situation and give 15 minutes’ time for this purpose.

In the group C, create a situation that a few members who got loans from the group fund are defaulting.

Assemble the groups and hold a debriefing session.

Questions to be asked during the debriefing session:

How will you process and sanction a requisition for loan?

Will it be proportional to the member’s individual savings?


144

Will the group keep a ceiling on the maximum and minimum

loan size?

What shall be the rate of interest and schedule of repayment?

Will the group levy a service charge on each loan to meet the transaction cost?

Will the group like to know the purpose of a loan sought by a member and her repayment plans before sanctioning a loan?

How will the group prioritize the credit needs of the members in case the existing group fund is less than the demand for loan?

How will the group ensure the realization of the advanced loan if any of the members defaults?

What are the probable effects of under utilization of the group fund by the members? How will you tackle this problem?

Points for reflection:

In order to meet the credit needs of all the members objectively

and without any preference or favor for one over others, it is necessary that the group evolve its on norms related to on-lending among the members.

To match the group fund with the demand for loan, scanning, prioritization, and rationalization of all loan requisitions need

to be done in compliance with the group norms in this regard.

Scanning of loan requisitions may be done with regard to the

purpose, amount, and intended repayment schedule of the loan; prioritization may be done to ascertain the comparative urgency of the members’ needs for loan; and, rationalization

may help to know the appropriateness of the needs for a loan within the overall objectives of the group.

Under utilization of the group fund is likely to result in loss of income to the group through accrual of interest, etc. Therefore,

the group needs to discuss and analyze the possible causes of low fund utilization and find a way to avoid this situation. Exploring the future loan requirements of the members may

help in this regard.

Formalities like updating the records, getting the signatures or

the thumb impressions of the borrowers, etc. need to be completed before the loan is finally disbursed.

4. Organize a session to enable the participants to carry out a

group monitoring exercise.


145

[Process: monitoring and review are processes to check if everything is going as per the plan and the group is performing as

expected. They are tools of internal management of the group, which operate within the group’s stated goals and objectives. To

simplify this process goals and objectives are broken down into activities and indicators to be achieved within a certain timeframe. Accordingly, progress is measured. If the progress is

not as expected, barriers are identified and solutions are offered. Normally, monitoring & review in a self-help group is done through a meeting called for this purpose. Necessary outlines for

conducting such a meeting are given here. However, the following worksheet may further add to the group’s ability to carry out a

monitoring exercise. ]

Monitoring Design Worksheet

1 2 3 4 5 6 7

Objective Activity Deadline Indicator Progress Barriers Solutions

An Example: (Date of monitoring- 10.07.2001)

1 2 3 4 5 6 7

Objective Activity Deadline Indicator Progress Barriers Solutions Opening

group’s

bank

account

Preparation

of

necessary

documents

June 30,

2001

Typing or

writing

down the

text of the

document.

Securing

members’

signature.

Typing

complete.

A few

members’

signature

yet to be

secured.

Find those

members

and get

them to do

so.

Securing a

meeting

with the

bank

manager

July 15,

2001

Fixation of

an

appointment

with the

manager.

Appointment

could not be

fixed.

The

manager

is out of

town

Send a

letter

through

post.

Fulfilling

necessary

formalities

in the bank

and

securing

group’s

account no.

and a

passbook

July 30,

2001

--

--

--

--


146

Session Guide (for the review of a one year old group):

Explain to the group the meanings of monitoring, review, indicators/parameters, and planned activities.

Ask the participants to simulate a group meeting of a one-year-old group with a fixed agenda to review the group’s

performance over the last six months.

As in earlier exercises, nominate the office bearers of the group

and ask them to take initiatives in facilitating the review meeting.

Ask the group to find out and enlist the parameters/ indicators/grounds on which it would review its performance.

Facilitate the group to do so by revisiting its goals and objectives for which the group was formed.

Ensure that each of the parameters/ indicators are discussed

and shared among all the members so that all have a chance to speak.

Sort out those parameters/ indicators on which the group has performed well from those on which it has not fared well.

Lead the group to think about the ways to improve the group’s performance in the areas in which it has not done well.

Based on the outcome of the above exercise, facilitate the group to prepare an action plan for the coming six months.

Notes for the trainer: Ensure that the following indicators/parameters to monitor and

review a year old SHG are included in the list prepared by the participants.

Indicator Trend

Members’ attendance in group’s meetings

Increasing, decreasing, or same level

Monthly savings Regular, not regular, very irregular

Total Savings High, moderate, or low

Income of the group Less than the group expenses, more than the group expenses


147

Indicator Trend

Repayments of loans by the members

Very timely, timely only in a few cases, untimely, untimely in a few cases

Defaulting Frequent, rare

Group fund utilization as loans to members

Maximum, 75%, 60%, 50%, less than 50%

Repayment to Bank Regular, not regular

Members’ participation in group related activities, e.g.

meetings, decision making, problem solving, etc.

100%, between 100-75%, between 75-50%, or less than 50%.

Change/rotation in leadership roles.

Very frequent, less frequent, hardly any change or rotation

Problems faced during the last six months.

Narrate the problems

Mechanism to address those problems.

Narrate the mechanism employed

5. Organize a session to enable participants to develop skills in

managing contingencies during field implementation of an

SHG project.

[Process: contingency is something, which happens by chance, or without a warning. In implementing community projects, it is

necessary to identify, assess, and diagnose the important contingency situations that could occur so that the best decisions can be made. The contingency approach to project

implementation is to ensure that the community group is oriented and prepared to meet the unexpected demands of the situations in which they live and work. Following guidelines may

help the trainers to organize such a session.]


148

Objectives

To understand the importance of managing

contingencies.

To develop skills in managing contingencies.

Materials Newsprint

Felt pens

Chalk

White/blackboard

Copies of handouts on the incident study (part I & II)

Learning Method

Incident study.

Session Guide:

Divide participants into groups of five or six members.

Distribute the handouts on the Incident Study (Part I).

Ask each group to read and discuss it by sharing ideas. Ask

them to develop a plan of action based on this.

Instruct each group to select a leader to present the plan to

the whole group.

Give about 15 minutes to complete the activity.

Handout on the Incident Study (Part I)

You are a member of a five-person team assigned to go on a mountain hike. The proposed hike is scheduled to start tomorrow and will take two days of climbing. You plan to begin the hike very early tomorrow.

The mountain peak, which is your destination, is about 950 ft. in height and almost three-fourths covered by forests. The flat land area below has water and camping grounds. The climb is expected to be very steep after the halfway point. People have seen bears and wild boars, but not many attacks have been reported. Snakes and other reptiles have often troubled hikers. There are many rare varieties of rare birds. According to the weather forecast, day one will be cloudy but there will be no rain. On day two, sunshine is expected, but rain is likely. There are no roads, but the footpaths of previous hikers could be traced. Your group has prepared a map to guide you to the mountain peak and you are following this map. You intend to camp the first night in a tent your group will put up and intend to start early the next day. Prepare a plan for the hike.


149

Ask the leaders of each group to present the plan.

After all the presentations, ask the question: “Are you ready to face any unexpected situations? Allow each group to present

their viewpoints.

Distribute handouts of the Incident Study (Part II). Give them

a few minutes time to read it.

Ask the participants to go back to the same groups and

prepare an alternative plan.

Ask the group to consider what alternative actions they can

take. Let each group present its ideas. Discuss the importance of contingency plans.

Point out that given the same situation, different groups may

choose to employ different plans/strategies to achieve the same results.

Share with the participants a personal experience in a project where an unexpected situation occurred because of situational

factors. Explain how the situation was managed.

Ask the group whether they have faced similar contingencies

in their work situations. Request two or three volunteers to share their experiences in handling unexpected situations.

Reflect on experiences highlighting the need to manage contingencies. Explain to the group the significance of

contingency management in the context of formation and development of a Self-help group project.

Sum up the session synthesizing the major learning points.

Handout on the Incident Study (Part II)

You had a very successful first day. Your team was on schedule. You spent the first night in the tent. Today is day two and you are ready to start the hike to the summit of the mountain. A torrential rain comes down, as you are about to start the journey. It rains for three hours and when it stops you find that a huge mass of earth has washed down as result of an earth slip, wiping out the pathway completely. Prepare a plan of action to handle this contingency.


150


Emphasize the following points:

Unexpected events can happen and community projects are no

exceptions.

Community projects operate as open systems, constantly

interacting with the environment, and managing contingencies is and essential part of this process.

There are no definite ways of handling contingency situations but we must prepare ourselves for unforeseen circumstances.

Contingencies should be handled in a way appropriate to the context.

6. Hold a session to enhance the problem solving abilities of the

target group.

[Process: problems are natural in the life of any group, be it a self-help group or otherwise. Forging an alliance of people into a

self-help group in itself is an outcome of the problems faced by them as individuals. We may therefore see that if taken positively problems serve to increase our ability to face the challenges of

life. On the other hand, however, if they are taken as liabilities, then the chances of getting bogged down get higher. What is more

important, therefore, is to accept problems as they come and try to develop in us an attitude for solving them. Following exercise is aimed at enabling the participants to gain experiences in

handling problems related to the day-to-day transactions of a self-help group.]

Learning Method:

Mock session on Problem Solving,

Group Discussion.

Session Guide:

Divide participants into groups of 7 each.

Instruct each group to think itself as an SHG.

Facilitate the selection of a chairperson and a coordinator in

each group.


151

Assign each group a task involving a problem situation, which

has supposedly occurred in it (a few examples of such situations are given in the ensuing box).

Ask the groups to discuss their assigned problems among the

members and come with a solution.

Give 30-40 minutes for this purpose.

Call all the groups back for making presentations to the larger

group.

After each presentation, initiate a discussion on problem of

each group and the solution it came out with. Encourage the participants to visit the issue from all angles.

Examples of Problem Situations in an SHG

Situation 1: Savitri, a member of your group, has fallen sick

and needs a sum of Rs 200 urgently. The monthly group meeting for this month has already taken place. There is still a couple of weeks’ time left for next monthly meeting to take

place. How will your group solve the problem of Savitri? Situation 2: Kamala owes a sum Rs. 300 to the group. She did

not pay the principal amount for three months. In every meeting, when the members raise the issue, she tries initially

to plead her inability to repay the loan. Later on, she starts shouting at the top of her voice saying, “What is the group for if not to support the poor!” how does your solve this problem?

Situation 3: 3-4 members in your group have threatened to

drop out complaining their dissatisfaction with the behavior of the leader and a few others. Do you just allow them to leave? Discuss and try to solve the problem.

Situation 4: attendance in you group is becoming a problem, as members are not regular and many out those who are

comparatively regular are latecomers. When asked by the group leader, members normally reply, “We have a lot of household

work which keeps us very busy everyday. We do not have leisure time to roam about like you.” What will your group do to solve the problem?


152


During discussion, try to bring out the following points:

Situation 1: The group does have a role to meet the emergency needs of the members and hence, it should think of some mechanism to meet such exigencies. One way to do this is to

earmark some amount for this purpose. Situation 2: All the members have to abide by the norms framed

by the group as a collective decision. It should be made clear to all members that the group is to help the poor who wish to help

themselves. Shrugging off the responsibility of regular repayment in the name of helplessness is only counter productive and hence, cannot be allowed.

Situation 3: Autocratic leadership or domination of a few in the

group can destroy the group. The group leaders should be guided to be participatory and democratic in their approach. Rotation of leadership roles is a way to avoid such situations. This also helps

to ensure the participation of all, gradually over a period of time. Members also have a responsibility to take active part in the group activities and contribute to the well being of the group.

Situation 4: The members of a group have the responsibility of

attending their group meetings regularly and in time. Workload at home cannot be an excuse to remain away. Genuine problems can be attended by adjusting the time frequency, and venue of

the meeting.


153

CHAPTER 6

Basic Records of a Self-Help Group

ince the SHGs often deal with the collective money of the

individual members, maintenance of the books of accounts

and other group records becomes necessary to ensure

transparency and efficient functioning of the group.

In the beginning, the group depends on the enabling agency to

introduce and maintain all these records. However, as the group

develops and acquires basic skills of running an SHG, it takes

over the responsibilities of maintaining these records.

The enabling agency should ensure the introduction of the least

complicated system of records so that the group may maintain

them easily. As the group’s fund grows, employing a bookkeeper

or an accountant may be thought of.

In order to manage and monitor their affairs effectively, the

following group records are commonly maintained by self help

groups ––

6.1 Cash Book

ashbook is the most important record of the group. It is a

book of prime entry where all cash transactions done

during the course of a meeting are recorded.

S

C


154

All the cash transactions of a group during a particular time can

be categorized either as receipts or payments of the group

during that time. For example, when a member deposits her

monthly saving to the common group fund, it is termed as

incoming money, hence recorded as a receipt in the cashbook.

Similarly, if the group advances a loan to any of its members or

spends money otherwise, it is termed as out-going money, and

hence recorded as a payment in the cashbook.

To be more precise, we can say that any money coming to the

group is a receipt whereas any money going out of the group is

a payment.

A cashbook therefore is a record, which shows all the cash

receipts and cash payments of the group made at a particular

point of time.

In a cashbook, receipts are shown on the left hand side of the

book whereas payments are shown on the opposite side of the

receipts, i.e., on the right hand side of the book. All the receipts

and payments are totaled after a day’s transactions and the

cash-balance in the book is tallied with the physical cash in the

cash-box. It ensures two things - whether the entries in the

cashbook have been made correctly and whether any money is

missing from the cash-box.

Receipts

of the

Group

Payments

of the Group


155

A few examples of cash receipts are membership fee, loan

processing fee, fines and penalties levied on the members,

savings from the members, loan repayments received from the

members, grants/loans received from bank or development

agencies, interest on loans from the members, interest on the

deposit of money in the bank, cash withdrawal from bank, etc.

A few examples of cash payments are loan disbursals to the

members, interest on savings paid to the members, salary to

accountant, loan repayment to external sources, transportation

and other expenses of the group, deposits to the bank, etc.

In the following table a specimen of a cashbook is illustrated by

showing the columns of receipts and payments –

Date Particulars LF Amount

In Rs

Date Particulars LF Amount

In Rs

1.1.99 Savings

Penalties

Interest

(On loans

advanced to

the members)

1

5

7

400

50

50

1.1.99 Loans

Salary

Interest

(Paid on the

savings of the

members)

10

4

9

40

100

60

Total

Receipts

500

Total

Receipts

500

Total

Payments

200 Total

Payments

500

Balance 300 Balance


156

6.2 Ledger Book

ontrary to a cashbook, which is a book of prime entry, a

ledger is a book of final entry, which contains accounts of

all types under different heads.

It is also called the principal book of account as all the financial

statements are extracted through the general ledger balance

only.

The ledger helps us to get all necessary data at one place, since

all types of entries are recorded in it under different specific

heads.

Separate pages are maintained to record transaction of one

type; for example, all expenses on salary to the accountant will

be on one page. Likewise, all the savings of the members will be

recorded on one page and all the advances as loans to the

members will be recorded on another page.

If the group wants to know how much money it has spent on

traveling to bank during the last month, it can know by looking

into the traveling head account recorded on a specific page of

the ledger.

A ledger may have in it member-wise separate sheets for the

monthly and voluntary savings deposited by them. Likewise, it

can have borrower-wise separate sheets for the loan advances

availed by them from time to time. However, the group may

maintain separate ledgers for these purposes if it finds it more

convenient. They may be called savings-ledger and loan-ledger

respectively.

C


157

A loan-ledger, for example, may have entries like the name of

the borrower, amount and purpose of the loan availed, date of

disbursement, total repayment period, installments for

repayment, rate and total amount of interest, processing

charges, total amount payable by the borrower, penalty in case

of late payment, penalty in case of non-payment, etc.

To further illustrate what a ledger is or how it is written, a

specimen format for members’ monthly savings is given below: -

Page No. 29

Name of the Account Bank Account

Date Particulars C/B

Folio

Deposit Withdrawal Dr./Cr. Balance

1.2.99 Cash

deposited

1 1000 Dr. 1000

7.2.99 Cash

withdrawn

5 200 Cr. 800

17.2.99 Cash

deposited

8 500 Dr. 1300

18.2.99 Cash

withdrawn

8 700 Cr. 600

22.2.99 Cash

deposited

10 800 Dr. 1400

27.2.99 Cash

withdrawn

12 400 Cr. 1000


158

6.3 Pass Books

assbooks are members’ records of her savings created,

loans raised, interest accrued on savings, interest paid on

loans, withdrawals made from the savings, penalties paid for

late repayment of loan, etc.

These passbooks are very much like those of banks given to the

account holders. Separate passbooks may be created for savings

and loan transactions of the members. Even separate colors

may be assigned to them for easy identification and use.

Below is given a specimen format of a member’s savings

passbook: -

Name of the Member – Savita Devi; W/O- Gheesu Mal

Age- 40 Years; Address- Premnagar, Lucknow (UP).

Date Amoun

t Saved

Amount

Withdraw

n

Savings

Balance

Interest

on

Savings

Cumulativ

e savings

Treasure’s

Signature

1.2.99 100 Nil 100 Nil 100 Sd/-

7.2.99 100 Nil 200 Nil 200 Sd/-

17.2.99 100 Nil 300 Nil 300 Sd/-

18.2.99 100 50 350 Nil 350 Sd/-

28.2.99 150 Nil 500 5 505 Sd/-

P


159

6.4 Minutes-cum-Attendance Register

his register contains the proceedings of the meetings held

by the self-help group from time to time. Generally, the

proceedings of a meeting cover the mention or details of the

following items: -

Date, timing, and venue of the meeting,

Names of the present and the absent members,

Agenda of the meeting,

Members who chaired and coordinated the meeting,

Names of the recently joining members,

Names of the members, who dropped out,

All group decisions regarding financial and non-financial

matters, and

Signatures of all the attending members

A properly maintained minutes book is likely to show how the

group has evolved its various systems and procedures over the

years.

The normal practice is that at the end of a meeting its minutes

are read out to all the members for obtaining their confirmation,

which the members do either by affixing their signature or

thumb impression at the end of the page containing the

minutes.

T


160

6.5 Financial Auditing in a Self-Help Group

uditing is a systematic verification of books of accounts by

an external person, other than the book writer or the group

members. The broad objective of auditing is to ensure proper

maintenance of the books of accounts of an SHG. However, in

addition, it serves the following purposes:

To promote financial accountability and transparency in the

management of an SHG.

To find out and rectify errors and omissions, if any, in

maintaining the records and books of an SHG.

To strengthen the SHG’s accounting system.

To confirm the income, expenditure, assets, and liabilities of

the group.

To promote recognition and credibility of the group.

To use it as a reference for future financial planning and

decisions.

A


161

EXERCISES

1. Hold a session to enable the participants to realize the

importance of record keeping/maintaining accounts for the better management of an SHG.

[Process: maintenance of the books of accounts and other group

records is necessary to ensure efficient functioning of an SHG. It also ensures transparency in the financial matters of the group. Initially, every group depends on the enabling agency for

maintaining its records. However, with the passage of time it is expected of it that it acquire basic skills for doing so. Therefore, at

some stage of group development it becomes necessary that the group realize its responsibility of managing its finances without the agency’s support. The following session is designed to help

the trainer in organizing a session to emphasize the importance of bookkeeping in an SHG.]

Name of the Activity:

Money Game

Materials required:

Paper money,

A sample of various books of accounts and other documents

used in SHGs,

Chart papers and markers

Session Guide:

Start your session with a very brief introduction of the activity

for the session (do not disclose the plan of the game).

Ask a volunteer from the group to distribute the paper

currency to a few participants.

Ask her to take the money back and redistribute it among the

other participants.

Again, ask her to recollect the money and redistribute it

randomly among a few participants.

Repeat this process 4-5 times.


162

Now, ask the volunteer to recall how much money she

distributed and to whom in each turn.

Similarly, ask the participants to tell how much money they

received in each turn.

Note to the trainer:

It is clear that neither the volunteer nor the participants would be able to recall exactly the monitory transactions, which took

place during the game. Therefore, lead the group to think over what might happen if transactions are not recorded in an SHG.

The trainer, consequently, may emphasize to the group that frequent transactions cannot be remembered after a while and

hence, have to be recorded somewhere.

2. Hold a session to give participants an introduction of the various books of accounts and other documents used in an

SHG.

[Process: the kind of books of accounts and other records used in an SHG would depend upon the procedures and accounting

norms adopted by that SHG. However, the enabling agency has a very definite role in introducing the least complicated system of

records so that the group may maintain them easily. The trainer may use the following session to introduce books of accounts and other records used in an SHG.]

Materials required:

A sample of various books of accounts and other documents used in an SHG

Learning Process and Methods:

Demonstration,

Learning in small groups,

Lecture and Group discussion.


163

Session Guide:

Display all the books of accounts and other records one by one to the participants.

Pas around each type of book/record and explain how they may be identified.

Now, divide the participants into as many groups as the books/records may be.

Name each group by a particular book name such as cashbook, passbook, etc.

Introduce briefly the role of each book/record in an SHG.

Give 15-20 minutes’ time to each group to remember its role

as a particular book or record in an SHG.

If the groups are literate, then they may be asked to write

down their role on a chart paper.

Call the groups back and ask them to introduce themselves

one by one to the larger group.

Note to the trainer:

If time allows, the same exercise may be repeated by exchanging the roles of the smaller groups.

Similarly, you may organize a small quiz to reinforce the learning of this session.

The session should focus on the bigger picture of record-keeping and not small details of each record. It is important

that members understand the contents of each record and the logic and importance of it; yet, they may not be expected to understand what goes into each row and column of all the

records. The purpose is solved if they understand the link and logic behind all the records.

Copies of the formats of group records may be distributed to all the members to enable them to identify and get a hang of it

and its broad structure.


164

3. Hold a session to highlight the importance of forming

federations of self-help groups.

[Process: federating SHGs is useful to the project implementing agency and the unit SHGs both. Reasons enumerated in chapter

5 of the manual evince this fact well. However, a practical session establishing the importance would surely have far reaching

impact upon the listeners. The trainer may use the following exercise to hold such a session.]

Methodology:

Demonstration

Materials:

Around 150 marbles

One bundle of twine

One pair of scissors

Session Guide:

Drop all the marbles on the floor of the training room.

Tell the participants that marbles placed here and there

represent villages.

Villages cannot be shifted, but people in the villages can move.

The task before the participants is to link all the villages.

Allow the participants to work on it for about 15 minutes.


Facilitate the group to link up around 10-20 nearby villages by

encircling them with the help of a piece of twine.

Once all the villages are encircled in separate circles, facilitate

them to link all the circles with one another using small pieces of twine. The structure may appear as the following given below.


165

Link the emerging structure with that of a federation of SHGs.

Analyze the experience of the exercise in the light of the

concept and need of federating SHGs.

4. Hold a session to familiarize the participants with the basic

documentation required in sanctioning a loan.

[Process: loan processing is an important group activity. Associated with it is the need to properly document it in corresponding books and records of the group, the skill for which

comes only by way of practice. Therefore, a session on this is supposed to largely focus on initiating a learning-by-doing exercise in the group, preceded by a theoretical briefing of the

procedure. The trainer may follow the following guidelines to organize a matching session.]

Materials:

Four or five sets (samples) of all the documents required for processing and sanctioning a loan.


166

Learning Method:

Lecture and Group Discussion

Session Guide:

Emphasize to the group that recording the details of a loan in the books of accounts and other group records is vital for the

proper functioning of the group.

Tell them about the books and other group records, which are

required for this purpose.

Demonstrate and circulate those records among the

participants, if they are not already familiar with them.

Explain to the participants the procedure to be followed while

processing and sanctioning a loan.

Now, divide them into groups of 4-5 members each.

Documents required for sanctioning a loan

Loan application from the member

Minutes or resolution book

(Where the decision to lend or not is recorded)

Agreements

(It is optional and to reconfirm and validate the terms & conditions)

Promissory note (optional)

(It is optional and to reconfirm and validate the terms & conditions)

Cheque Book

(If the group follows the practice of issuing

loan by cheque only)

Loan ledger

Vouchers

Cashbook

Individual passbook


167

Ask each group to simulate a group meeting where members

are to process a loan application of a particular member.

Give each small group a pre-decided task on processing and

sanctioning a member’s loan application.

Ask them to follow the procedure narrated to them.

Coordinate them closely or assign a separate facilitator to each group. Provide on-the-spot-help wherever necessary.

Spare an hour for this exercise.

Call the groups back and ask them to report to the larger

group one by one, on how it accomplished the task.

Hold a debriefing session and sum it up.


168

CHAPTER 7

Some Guidelines for Field Workers

ealing with people of different socio-cultural milieus,

especially in a rural setting, is often a challenging task. It

is in this sense that formation and development of self-help

groups in a rural setting or in a disadvantaged urban

community setting, where people may not be having experience

of a formalized group life, is challenging.

Keeping this in mind, certain work guidelines are presented

below which may be referred to while working as a field worker

or a group facilitator.

7.1 Tools to Conduct a Situation Analysis

Before you actually go on board for organizing a self-help group,

you need to make an analysis of the community from various

angles such as the socio-economic status of the members,

resources of the community, potentials for savings, credit needs,

available sources, women’s status, identification of the poorest

members, etc.

Data on all these checkpoints help you to plan your steps for

the formation and development of self-help groups in that

particular community.

D


169

This pre-group formation exercise is often referred to as

situation analysis, which we have already discussed in section

2.1.

It is a guided enquiry into the conditions of the community and

the impact they have on different sections of people so that

planned interventions may be taken up for achieving the project

goals.

In the following sections, let us examine in brief some of the

tools, which are commonly employed in conducting a situation

analysis:

7.1.1 Participant Observation

Participant observation is an effective method of in-depth study

in a small community situation. It usually involves living in the

community under study for a small period, say a couple of

weeks or a month.

The main idea is to participate in community life as fully as

possible, keeping detailed notes of what is heard, seen, or felt

about the subject under study.

This approach is a mix of observation, discussion, and informal

interview. Its success depends both on gaining acceptance in

the community and on careful recording of all that has been

observed and discussed.

A participant observer has the advantage of gaining access to a

continuous flow of information emanating right from the heart

of the community.


170

7.1.2 Case Studies

A case study scans deeply a typical case in a group. A skillful

inquiry into a case can reveal a rich and a lively picture of the

group it belongs to.

Although a case study does not give a generalized statistical

data on the subject of its inquiry, it does provide valuable

insights into it.

For example, to know what the credit needs of women in a rural

area are, you might look at just one village and study it as a

typical case.

7.1.3 Key Informants

It is often possible to collect valuable information from a few

members of the community who are particularly knowledgeable

about certain matters. Some of the examples are community

leaders, health workers, schoolteachers, extension workers, etc.

Key informants are most reliable on factual matters, such as

services and facilities available to the community. Even their

opinions and evaluations are helpful in understanding the

community, but for a wider view you need to follow up with a

survey or other research methods.


171

7.1.4 Individual in-depth Interviews

In-depth interview is a valuable tool as it can be used in a

number of social research methods.

An in-depth interview differs from the interview held with the

key informants in as much as the former is more open ended

and is far wider in scope. An in-depth interview can be

unstructured or semi-structured as per the requirement. The

aim of an in-depth interview is a shared exploration of the

issues without the researcher imposing his or her ideas.

Individual unstructured or semi-structured interviews are

especially suitable for work on attitude, opinions, and for

dealing with sensitive topics.

Aim for a small sample of about thirty people in exploratory

interview surveys. It is important to include a wide range of

community opinion.

7.1.5 Social Surveys

Social surveys use specially designed interview forms in which

the range of possible answers to each question is known in

advance. They are often listed on the interview form, so that the

interviewer simply marks the appropriate reply.

When the range of answers is not known, the study designer

conducts a pre-test or pilot survey to test the questions and see

what answers are given.


172

When the community of interest is small (say, less than 200

households), you may perform a complete (100 per cent) survey.

In larger communities or in urban areas you will have to choose

a sample of households for interview. All types of people in the

community must be properly represented in the sample.

7.1.6 Group Discussions

In group discussions, which are also called ‘focused group

discussion’ sometimes, the interviewer guides a conversation

among a small group of six to ten members of the community of

interest.

A wide discussion on relevant issues and concerns are

encouraged and the opinions of the community members are

learnt.

You should hold several group discussions to include a wide

range of community opinion. It is advisable that the members of

the discussion group are of the same sex and they share a

similar background. This helps the members to be at ease with

one another and state their views without hesitation.

7.1.7 Wealth Ranking

Wealth ranking is a PRA (Participatory Rural Appraisal)

technique, which is often used to identify the clusters of

households according to well-being or wealth, including those

considered as the poorest or the worst off.

To conduct a wealth ranking exercise in a village or community

you may take help of the following steps: -


173


174

► With the help of a local key informant, make a list of all

the households of the village/community.

► Prepare as many cards of the size of 2 x 3 inches as are

the households in the village/community.

► Assign a card to each household and write the names of

the head of the family and the spouse on it.

► Assign each card a serial number on its back like 1, 2, 3,

etc. for example, if there are fifty households prepare 50

cards and on their back write numbers from 1 to 50 in a

serial.

► Take one person aside and ask him to identify from the

cards the poor, the better off, and the rich in the

village/community by putting the cards in three separate

piles. This done, ask him if he would like to make any

correction.

► Note down the list of the household as categorized by him.

► Ask him on what basis (like land ownership, asset

ownership, govt. service, business, etc.) he categorized

people into different piles and note down his explanation.

► Verify wealth ranking by doing it with 2-3 people of the

village/community separately.

► In the end, you will have a list of the people of the

village/community in the order of their wealth status. You

may additionally have a list of indicators upon which

people define poverty.


175

7.2 Focusing on Women in SHG Formation

7.2.1 Women have shown more fiscal discipline than men in any

savings and credit program world over.

7.2.2 Women in poor households have a natural flair for utilizing their

savings and credit to the benefit of the whole family.

7.2.3 Risk of providing loan to poor women is relatively much lower

than the risk of providing loan to poor men.

7.2.4 Simple, less expensive, and easily accessible credit through

informal micro-finance programs is an important factor in

helping women on their way to self-empowerment.

7.2.5 Women have the potential for becoming a significant contributor

in increasing the cash flow of her household provided she has a

way to create a saving and has access to timely credit.

7.2.6 Women’s success in self-help programs enriches their quality of

life in social aspects also. They gain self-confidence and due

respect in family and community.

7.2.7 However, mere provision of credit to women in a male

dominated society is likely to result in the use of women as a

front for accessing easy credit without involving them in

decision-making process for utilizing the credit and the benefits

accrued thereupon.

7.2.8 A self-managed group or a self-help group not only provides a

mechanism to pool in their regular savings in a common fund

but also provides access to outside financial services and


176

facilitates a process of women’s empowerment. It helps them to

articulate their common issues and concerns and generate

strength to deal with those issues and concerns in a very

positive way.

7.2.9 A well-managed SHG has the potential to operate as a small but

efficient banking institution to deliver savings and credit

services to its women members and to provide a safety net for

critical periods in their life.

7.3 Interacting in the Community and the Group

7.3.1 The group members generally look upon the field worker as a

role model for all issues concerning the management and

operation of the group affairs. Not only that, other community

people, being somewhat skeptical of the motives of the

development agency initially, also keep an eye over him/her. It

is therefore necessary that the field worker convey the right

message through his/her disposition and outward behavior

right from the beginning.

7.3.2 Sounding different from the community should be avoided as far

as possible. One should try to present oneself in a very simple

way and polite language, but with a firm conviction.

7.3.3 To know people individually, outside of the meetings, by

spending time with them at their houses and fields could be

very rewarding. This helps to build trust between you and the

group.


177

7.3.4 A prior sequencing of your activities and scheduling of time

before you set out for a visit to the community helps you to be

in command of yourself and your work in the field.

7.3.5 Be observant of people’s behavior during a meeting, which is

often of different kinds. It will help you in knowing who among

them are active or very active, who are only fence sitters or

passive followers, and who are born pessimists or opposition

leaders.

7.3.6 Be observant, more importantly, of your own feelings, biases,

and values during your interactions in the field. These may act

as undesirable hindrances between you and the people you are

interacting with due to differences in respective cultural and

social backgrounds.

7.3.7 It will be a wrong idea to assume that people are understanding

and absorbing whatever they are listening or hearing, just

because they are agreeing and nodding their heads in

affirmation. There may be many blocks to effective

communication between you and your audience, for example,

your language or dialect, your speed with which you are

speaking, the subtlety of the idea you are conveying, or the

inattentiveness of the listeners. It is therefore always desirable

that you ask for feedback from individuals in the group on

matters that have been discussed.


178

7.4 Facilitating Group Meetings

7.4.1 For a field worker it is necessary that he/she keeps a close track

of various group processes and is able to observe, identify, and

analyze the group dynamics properly.

7.4.2 Identifying group dynamics means understanding the behavior

pattern of the group members in the group situation. For

example, it is useful to know who are the members who do not

participate in the meeting and why, who are the dominating

ones and how they inhibit others from coming out in the front,

what sub-groups exists and how they affect the cohesiveness of

the group; and who are the members who have dropped from

the group and why.

7.4.3 Leadership in the group needs to be identified from the very

beginning and the field worker should make conscious efforts in

encouraging and preparing members to come ahead and take on

group tasks without hesitation.

7.4.4 Leadership serves to act as a referral point for the whole of the

group and makes them easier to function as a group. In the

absence of pronounced leadership, there is always a danger that

the members keep identifying only the field worker as their

leader. As a result, the development of the group as a cohesive

unit is thwarted.

7.4.5 Always talking of savings and credit may at times become

monotonous and boring to the members and hence a change in

routine is likely to liven up their spirits and refresh their

interest in the group. Any additional activities such as a session

on learning to write their names, sharing their common

problems, or organizing cultural events may go a long way in


179

preparing them for more active participation in the routine

activities of the group in future.

7.4.6 Transparency in financial transactions of the group must be

maintained at all levels. The field worker plays an important role

in setting fiscal discipline in the group from the very early days

of group formation. Without a sound fiscal discipline, the group

is most likely to disintegrate.

7.4.7 Therefore, barring emergencies all financial decisions must be

taken in the group meetings only.

7.4.8 All the group norms should be fixed by mutual agreement of the

members and must not be pressed upon by the field worker in

any case. All that a field worker can do in this regard is to

suggest various alternatives to the group and facilitate a process

to select the most appropriate from amongst them.

7.5 Loan Repayments and Monitoring

7.5.1 Rotation of group fund, which is known as revolving fund, is one

of the main tasks of a self-help group. For the group fund to be

always in rotation, it is necessary that the members observe

strict discipline in loan repayments.

7.5.2 However, one of the recurring problems in a group could be

delay in repayments of loans raised by the members or even

non-repayments in certain cases.

7.5.3 Causes of late repayments of loans in a group may vary from

case to case. In case of consumption loans, delay may be

because of lack of income or a regular flow of income to the


180

borrower. Similarly, in case of a loan to purchase productive

assets for income generation activities, it could be the gestation

period required for the income to take place.

Therefore, to deal with the problem adequately, it is necessary

that the field worker and the members know the exact reasons

behind them. To avoid or minimize such an occurrence, the

group should go through a thorough repayment assessment

before sanctioning a loan to a member. A matching and

practicable repayment schedule should be devised to allow the

borrower a reasonable time schedule.

7.5.4 Only under compelling circumstances, the repayment schedule

should be revised in between, as it will set a bad precedent for

other members.

7.5.5 Any case of late repayment must be discussed in the group

openly and all the members should be consulted for exploring a

possible solution.

7.5.6 The group must be reminded of the fact that late repayments

may turn into no-repayment of loan unless strict monitoring is

done. Non-payment of a loan is actually a loss to the whole

group; hence, the group must act collectively for maintaining a

fiscal discipline and monitoring over repayments.

7.5.7 In case of intentional late repayment or non-repayment, the

group needs to take prompt and firm action. However, it is

important that the pressure must be exerted by the group and

not by the field worker directly.


181

7.6 Various Financial Transactions within a Group

n any self-help group, especially those created around the

theme of savings and credit, monetary transaction has a key

role to play. Hence, it becomes important for a field worker, and

the members of a group as well, to know about the different

components of the financial transactions of the group such as

the liabilities, income, and the expenses of the group.

7.6.1 Capital of the Group

The capital of the group consists of the following components –

Individual savings of the members,

External loans from the development agency or bank, and

Its own net income after meeting all expenses.

The first two of these are borrowed capital and hence they are a

liability of the group; they are supposed to be paid back to the

members or to whatever sources they have come from.

7.6.2 Income of the Group

The income of the group may consist of the following

components:

Membership fee

Interest charged on loans

I


182

Interest on money in the bank

Loan processing charges

Fines and penalties

Miscellaneous receipts

(Such as a grant from the development agency, etc.)

7.6.3 Expenses of the Group

The expenses of the group are the sum total of the following –

Personnel and Administrative cost,

(Accountant’s salary, stationery, transportation, etc.)

Financial cost, and

(Interest paid on the savings of the members, interest paid on

external capital)

Bad debts (Non realized loans),

7.7 Common Reasons behind breaking up of a

Group

Members’ unrealistic expectations from the group such as

monetary benefits in terms of grant


183

Acrimonious sub-groupism within the group based on

outside-the-group relationships of the members

Slandering and misinformation campaigns by the people

(such as moneylenders, husbands of the women members,

etc.) whose interests are harmed by a strong self help group

of women.

Caste conflicts among the members or sharp disparities in

their socio-economic status

Lack of transparency in financial transactions of the group

Poor record keeping and overall mismanagement of the

group’s affairs

Lack of leadership in the group

Non-participatory and non-democratic functioning of the

group causing grievances and lack of collective group effort

Lack of vision as to what the group should do next after a

certain period, say 3-4 years, of successful savings and credit

activities.

Most importantly, delayed repayments of loans by the

members and instances of default leading to de-capitalization

of the group’s revolving fund.


184

EXERCISES

1. Hold a session to familiarize members with the different tools

of data collection for analyzing and understanding the various components of a community.

[Process: familiarizing participants with tools of data collection

may take more than one session, as they are quite a few such as participant observation, case study, key informants, individual in-depth interviews, social surveys, group discussions, and

wealth ranking. Conceptual inputs on these tools given in the preceding chapter may be used during these sessions. As regards

the learning method, it may be different for different tools. Tools like in-depth interview and group discussion could very well be introduced by holding mock sessions on them, followed by a

debriefing by the trainer. Similarly, for introducing tools like participant observation and key informant, simulation method

may be tried. The trainer may organize a short field visit to enable the participants to learn the skills of conducting social surveys and wealth ranking exercise. A similar method to introduce the

tool of case study may be devised.]

2. Organize a session to bring in focus women’s performance in

the formation and the running of self-help groups.

[Process: as we mostly work on women’s SHGs (reasons given in the concerned section of the chapter), holding a session to highlight their performance in this field serves to motivate and

encourage them to come out of their psycho-social blocks, if any. In addition, it gives them a vision for their own involvement in a similar pursuit. Presenting a case study, conducting a role-play,

or organizing a video show, bringing attention to women’s feat through an organized effort, could very well serve to the success

of such a session.]


185

3. Hold a session to emphasize finer points to remember while

interacting with a community and probable group members.

[Process: as has been said earlier, the group members look upon the field worker as a role model. Even the community people

watch him/her closely. Therefore, it is necessary for the field workers to convey the right message through their disposition

and outward behavior. Any slackness in this regard may cost the agency people’s faith in it and hence, the very objective of the project may get jeopardized. Therefore, organizing a session on

this must be taken in right earnest by the trainer. A role-play highlighting negative qualities in a field worker and consequent

disadvantages can hold the session well. A poster or a case presentation focusing on dos and don’ts of a community field worker may further supplement the session.]

4. Organize a session to impart useful tips to the participants

on facilitating group meetings and learning facilitation skills.

[Process: a skill can hardly be imbibed in isolation of hands-on

experience. Therefore, learning of facilitation skills can be made possible only by exposing the participants to real field situations, which they get in course of their field job, or through a pre-

organized field assignment and making a structured follow-up. However, providing tips in a classroom situation and initiating group discussion on them does help in orienting their frame of

mind suitable to field requirements. Therefore, the trainer may organize a slide show depicting useful tips on facilitating a group

meeting and eliciting comments and inputs from the participants through intelligent questioning.]

5. Organize a session to enable participants to learn and

calculate various components of a group’s financial transaction such as its income, expenses, capital, etc.

[Process: ability to calculate depends much on the numerical

literacy (numeracy) of the SHG members. In village or in communities, where the SHGs are formed, the level of women’s numeracy is generally low. That is why, in most SHGs an external

book writer is hired. However, it is expected of all the members that they are at least familiar with various components of

financial transactions, which the group undertake. Therefore, a session to enable the participants to gain an understanding of these components will be in right place, irrespective of the fact

that the members are literate or not. Outlines given below would help the trainer to organize such a session.]


186

Learning Method:

Probe in the large group

Session Guide:

Pose the following questions to the participants one by one –

► What are the sources of income of a group?

► What are the possible expenses of a group?

► What is the capital of a group?

► What the group owes?

► What the group owns?

Depending upon the discussion on each question, make a

table, as shown under, containing responses under each question head.

SN Particulars Responses Example

a. What are the incomes of a

group?

b. What are the expenses of a group?

c. What is the capital of a group?

d. What the group owes?

e. What the group owns?


187

Make sure that the following components are included in the

responses’ column of each question.

SN Particulars Responses Example

a. What are the sources of income of a group?

(Calculated here on monthly basis)

Membership fee, 25.00

Interest charged on loans, 50.00

Interest on money in bank, 10.00

Loan processing charges, 50.00

Fines and penalties, 10.00

Miscellaneous receipts (such as a grant, etc.)

50.00

T O T A L 195.00

b. What are the possible expenses of a group?

(Calculated here on monthly basis)

Admn.

cost,

Accountant’s salary,

50.00

Transportation, 25.00

Stationery 15.00

Finan.

cost,

Interest paid on members’ savings,

15.00

Interest paid on external capital

20.00

Bad debts (non realized loans)

20.00

T O T A L 145.00

c. What is the capital of a group?(Calculated here on half-yearly basis)

Members’ Individual savings

5,000.00

External loans 10,000.00

Group’s net income after meeting all expenses

300.00

T O T A L 15,300.00

d. What the group owes?

(Calculated here on half-yearly basis)

Capital from outside (NGO, Bank),

10,000.00

Members’ individual savings

5,000.00

Group’s net income after meeting all expenses

300.00

T O T A L 15,300.00

e.

What the group owns?(Calculated here on half-yearly basis)

Cash and deposit in bank, 4,300.00

Loans with the members 11,000.00

T O T A L 15,300.00


188

Explain the meaning of each component used in the above

table.

Tell the participants that all the above calculations are done

for a specific period, say weekly, monthly, half yearly, or annually.

Present a few examples for each type of component such as

income, expenses, etc as given in the example column.

Tell that the statements of accounts covering the rows (d) and

(e) actually present a balance sheet of an SHG.

Brief the group that similar balance sheet should be prepared

and reviewed by the group periodically, to monitor the financial status of the group (the trainer/facilitator should

note that what group owes and owns always balance).

Explain to the participants that a comparison of rows (a) and

(b), involving income and expenses respectively, reflects financial sustainability of the group.

In the example cited above, it is clear that the group is managing a net monthly income of Rs. 50/- (monthly income

Rs.195 - monthly expenses Rs.145 = Rs.50), which proves its financial viability.

In case the income of a group is less than its expenses then

the group runs into loss and needs to take corrective measures lest it should fall apart.

After sharing the example, emphasize that similar income and expenditure account should be prepared and reviewed

periodically by the group to ensure that the group becomes financially sustainable.

Notes for the trainer:

While probing through the questions, women should be encouraged to respond.

All the responses should be verbally repeated, to reinforce the line items that constitute costs, income, liabilities, and assets.

Explain to the members that savings is not an income of the group; the group rather uses it for extending loans to its

members. Hence, it is in everybody’s interest that timely repayments of loans by the members are ensured.

Clarify that members’ savings and external loans are borrowed capital and hence, they are liabilities of the group; they are

supposed to be paid back to the members or to whatever external sources they have come from.


189

Emphasize that before ending a day’s meeting, the book

keeper/treasurer needs to share basic financial information such as day’s cash collection and disbursement, cash-in-hand and cash-in-bank, total group fund, etc. with the group.

You may share with the group that income and expenditure account may be prepared every quarter, to keep abreast of the

group’s financial health and take corrective measures, if required.

6. Hold a session to emphasize common reasons behind

breaking up of a group

[Process: the task of a group facilitator/field worker does not end with the mobilization of prospective group members into forming

a self-help group. Long term sustainability of the group, in terms of financial and organization viability, has to be ensured both by

the facilitator and the group members, especially the group leaders, in various ways. Therefore, it is important to know the factors and reasons, which normally bring harm to the feelings of

goodwill, cooperation, and neighborliness among the group members, and consequently lead to the disintegration of the group. The text on this issue given in the preceding chapter may

be used in a session on this subject. As regards the learning method to be employed for the session, much will depend on the

approach of the trainer and the level of participants in question. Ordinarily, one may think of methods like a case presentation, a slide show, a role-play, or even a poster presentation.]