Self Help Groups (SHGs) plays an important role in upliftment of disadvantaged sections of society by developing rural areas. Elucidate. Further, mention the constraint faced by SHGs and how they can be addressed.

SHGs are the group of voluntary organisations of people, preferably from the same socio-economic background, who have come together for their socio-economic empowerment.

Vehicles of rural development:

• Financial inclusion of the rural population and cheap availability of loans.
• Gender empowerment as most of the self-help groups are formed by women.
• Self Help Groups after availing loans take up various agricultural and industrial activities, thus promoting employment.
• SHGs formed by the marginalized sections such as SCs, STs, OBCs are helping in their upliftment by providing effective benefits under government schemes.
• Helps in collective bargaining, collective help amongst one another.

Constraints faced by SHGs:

• Banks are reluctant to provide loans to SHGs due to the NPA crisis.
• Poor management practices and lack of managerial staff, limit their effectiveness.
• Too much reliance on government support and on bank loans.
• Most of the SHGs are concentrated in agricultural activities.
• Most of the SHGs are informal, which thus limits the delivery of government’s benefits to them.

Measures to address constraints:

• Digitization of SHGs and bringing them under the financial net.
• To further increase the disbursement of loans to SHGs. Some type of interest subsidy can also be provided.
• Efforts must be strengthened for diversification of SHGs in other sectors, e.g. MSMEs.
• Role of NABARD must be made more effective.
• Incentivizing scheme for better performing SHGs to bring a behavioural change.

SHGs have proved to be the vehicles of rural development and upliftment of marginalized groups. The efforts are needed to strengthen their role.