Learnings from an interview with Dr. Rekha Gaonkar

I met Dr. Rekha Gaonkar on 8th of april 2013 at MES college Zuarinagar. She is an expert on SHG's, having done extensive research and field work in Goa.

The million dollar question.

Why are some SHG's not doing well ? 
Answers
1.  Lack of support and training by government or NGO. This is an external factor.
2. They do not produce unique goods. (Competition from branded goods, with most of the consumers preferring branded goods)
3. No Product differentiation within the SHG, Say for example every member produces the same product and its a seasonal one, they all lose out on sales in a season (Not the case with our SHG, Paper-bags aren't seasonal)
 4. Marketing is a big challenge for the SHG as they neither have the funds to extensively market their goods nor they have a place to sell their goods (say a kiosk or outlet in a market).
5. Literacy of the members. SHG's having more number of illiterate members are seen to fail in most cases.

Fundamental concepts re-learnt about SHG's:
1. 10-20 people from homogeneous background come together to form a SHG.
2. Initially for the first 6 months they put their own money into the thrift fund. ex. say 50-100 rs a month.
3. They have to have at least one meeting of all members in a month and the minutes have to be noted.
4. A book of transactions from the thrift fund to be kept.
5. After 6 months they can approach a bank and avail of loan in the name of the SHG. (Usually lent at 14% pa)
6. Members taking loan must then pay around 2% per month interest on the principal around 24% pa and the rest of the money after paying bank interest may be shared or left in the thrift fund.
7. There are 3 office bearers in an SHG elected periodically. President, Secretary and treasurer who perform the roles on rotation . ex x y and z are office bearers means they all will perform each role for 4 months in a year.

It's all about the money : Money is the fundamental reason which leads to a SHG's existence. Members join to avail of the loan facility.

And these are some of the products that successful SHG's are producing around Zuari:
Papad, Pickle, Ladoo, Chakli, Masala