Which of the following is a component of the SHG-bank linkage program in India?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. Non-governmental organisations providing capacity building training to SHGs.
A key component of the SHG-Bank Linkage Program (SBLP) in India is “Non-governmental organisations (NGOs) providing capacity building training to SHGs.” In this program, NGOs play a crucial role in forming and nurturing Self-Help Groups (SHGs), training members in financial literacy, group management, and income-generating activities. These trained SHGs are then linked with banks to access credit for collective economic activities.
Other options are incorrect:
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Microfinance institutions providing loans directly to SHGs is not part of the traditional SBLP, which emphasizes bank linkage.
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Banks providing loans to individual SHG members is avoided; loans are given to the group as a whole.
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State government subsidies may support SHGs indirectly but are not a formal component of SBLP.
The program, launched by NABARD in 1992, has linked over 1 crore SHGs with banks, promoting financial inclusion.