households in India. Female groups, exclusively account for 86 percent of SHGs.SHG savings have accumulated to 137 billion rupees with an average growth rateof 24 percent annually. Additionally, 1.83 million SHG loans are outstandingworth 373 billion rupees.Research has indicated that the financial and economic impact of SHGs has beenconvincingly positive, which supports the proliferation of the initiative. Saving,income and borrowing generally increase after members have been involved in a SHG(Puhazhendi and Satyasai, 2000). As individuals generally allocate loans to incomegeneratingpurposes, SHG members have subsequently recorded an increase in assetsattributed to joining a group. On a household level, SHGs had positive impacts onconsumption smoothing, diversification of income and nutrition through increasedcalorie intake (Deininger & Liu, 2009). As a result, SHGs have contributed to liftingthose involved out of poverty, with one study noticing poverty rates reduced fromfrom 42% to 22% after members had been involved in SHGs (Puhazhendi andSatyasai, 2000).However, there is concern that SHG are failing to include the poorest individuals intheir programs. For example, as poorer women were also perceived to participate inSHGs less, there are concerns surrounding the ability of SHGs to liberate the poorestof the poor. As the highest dropout rate for SHG membership is also high amongst thevery poor, SHGs ability to include the poor is hindered further (Tankha, 2012).Therefore, there is precedence to testing the effect of SHG involvement on variousquantiles to determine whether there is significant heterogeneity.To summarize, research on the impact of SHGs has discovered significant positiveeffects on both financial and economic indicators such as savings, incomes andborrowing. With regard to the financial and economic liberation of women, researchis yet to concretely identify an impact but evidence of late has identified a positiveimpact. From a business perspective, the relationship between the NGO, bank andSHG are crucial and while the impact of training on empowerment is positive, theimpact on economic and financial indicators is weak.


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