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Thursday, December 10, 2009

An Understanding of Women Self-Help groups in India

I am posting here the conclusion of my Master thesis that i wrote in India. The thesis is entitled " An Understanding of Women Self-Help groups in India". The idea of the research was to verify Olson's theory on collective action in a non-European context, according to Olson : if we assume that individuals are rational and they “seek to maximize their personal welfare, they will not act to advance their common or group objectives unless there is coercion to force them to do so, or unless some separate incentive, distinct from the achievement of the common or group interest, is offered to the member of the group individually in the condition that they help bear the costs or burdens involved in the achievement of the group objectives.” Therefore, the Indian context was suitable because society is not based on individualism but the individual is placed and defined through the community to which she belongs.

The idea of a self-help group is simple: an NGO or the government in a poor area be it slums or neglected villages, goes and sets up a self-help group constituted of 15-20 women. These women save weekly a small amount of money in a common pool with very low interest (1%) and they also borrow money from this common pool with a 2% interest. The difference between this scheme and the traditional microfinance practice is that the money stays in a closed circle, the group, which means that the women don’t seek microfinance institutions in order to borrow money, but they borrow from their own money that they save weekly. Nevertheless there is a self-help group –bank linkage in order for the women to be able to put the saved money in the bank or borrow a considerable amount to add to the existing pool. However, what distinguishes those groups is that women take up services for the community such as starting a health center in the area, waste management schemes, nursery for the children, and other types of actions that serve the community. The self-help innovation has constituted a success to the extent that the governments in the different states in India have started their own self-help groups that take up the same work as the NGO initiated groups.

Here are the conclusion of the thesis, i cannot post the whole research as it is 70 pages long.


In our research we have tried to grasp the functioning of women self-help groups in India. We have applied the Olsonian reasoning of groups and collective action on these community based organizations. In order to do that, we have traced the path of these groups from their conceptualization to their actual implementation. In a matter of fact, in order to arrive to the conclusion that Olson’s theory of groups applies to self-help groups, we had to analyze and study the main actors involved in promoting self -help groups, i.e. non-governmental organizations and government. The purpose of this examination was in order to observe how these actors are shaping their target population making them suitable for an Olsonian reasoning.

The different state governments and the central government of India have adopted the self-help group project as the main tool for fighting poverty. It was seen as a way to conciliate the contradiction between a highly unequal and hierarchical society structured around the caste system and the egalitarian and democratic vocation of the post-independence India embodied in its constitution that sought the abolishment of the caste system towards a more just society. In that sense self-help groups were an instrument for further decentralization and enhancing participation at the local level, therefore involving who are considered as the most marginalized in the Indian society, i.e. women. Behind targeting women, there underlies different assumptions that play a role in shaping them through circulating a certain style of thoughts. However, women self-help groups, in the name of empowerment and development, are conducting public service works such as cleaning the roads, upgrading the neighborhood and communicating government programs destined to the poorer populations. In short, they are doing the work that the government once did; therefore the government is somehow instrumentalizing the self-help groups in a way that they have become low paid public servants, they are used as well for the government to withdraw from its responsibilities as a provider of public goods.

The government withdrawal is coupled by the move of the NGOs to the forefront of this project; they have become the main holders and promoters of the self-help group scheme. These organizations target specifically women since they have given up on men self-help groups because they have failed. NGOs chose women due to several representations that they have of them: they have different backgrounds, some of them are substantial: they deal with the issue of the feminization of poverty, or they adopt a feminist point of view by approaching the issue from the angle of fundamental rights considering women’s access to credit through self-help groups will empower them. There is also the instrumental approach which contains an economic concern of including women in the contribution in the growth of the country. The other reason lies in the assumption that women are financially disciplined and tend to honor their debts more than men. These assumptions tend to shape women in order to make them suitable for the representations that these NGOs hold.

One of the main concepts used by NGOs when working with self-help groups is the one of empowerment. They claim that through self-help groups, women are being empowered, i.e. they are gaining power in order to get out of poverty. The concept of empowerment can hold different definitions, one which is neutral that doesn’t intend to change power structures, but only to build capacities. The other one is conflictual; it implies that when the poor are empowered they take power from those who have it. The international institutions like the World Bank, as well as NGOs seem to adopt the neutral definition of empowerment. Through this logic, building capabilities implies acquiring more credits, developing entrepreneurship and self-initiative. Through this approach to empowerment, NGOs are circulation the style of thoughts of international institutions to the women in self-help groups which affects self-help groups by rendering them apt to the methodological individualism assumption adopted by Olson when analyzing groups. Therefore in self-help groups, women also conduct a cost-benefit analysis to decide whether to participate or not.

In our second chapter we have argued that despite their small number, women in self-help groups obey directly to Olson’s theory of groups and collective action. In a matter of fact, through the support of Douglas’ critique of Olson’s exclusion of small groups from his theory, we have attempted in expanding Olson’s analysis in order to include small groups. Following the latter’s typology, women self-help groups can be classified as an intermediate group, which is a type of small groups. Therefore self-help groups combine the mechanisms of coercion and selective incentives of large groups and the advantages of small groups. Hence in order for the women to contribute in the production of the collective good which is acquiring more credit for them to take out loans from, a series of mechanisms enter into consideration. Women are subject to positive selective incentives which range from the possibility to get out loans from the groups, health insurance, scholarships for their children. There are also social selective incentives which are building relationships, having more self-esteem and confidence. Nevertheless, there exists also coercion mechanisms for women who refuse to contribute to the production of the collective good: these mechanisms range from paying fine, to forcing a person to contribute through locking her in her house, and finally exclusion from the group. Moreover these groups possess the advantages of small groups that insure the production of the collective good through peer pressure, and through the maintenance of strong social relationships which might lead to social exclusion in the case of non-contribution to the production of the good.

Nevertheless, the logic of participation in self-help groups doesn’t succumb only to the methodological individualism logic but those groups are rooted in the Gandhian philosophy and tradition. In fact, the Gandhian movement - which is highly influential in the Indian society - had promoted the concepts of self-reliance and self-rule which relocates the Indian individual back to his community. Those concepts promote the development of the self through the development of society. In light of the Gandhian input we spoke about, women engage in collective action from the logic of solidarity, duty and obligation towards the society and not because of a mere cost-benefit calculation the she conducts.

Self-help groups are highly dependent on NGOs as they provide them with the bank linkage, but also through them funds are channeled in order to maintain the activities that the groups initiate like health centre, crèche and other types of activities that self-help groups conduct. Moreover NGOs intervene often in order to resolve conflicts within the groups[1]. Thus, for sustainability concerns, NGOs and governments have started to form self-help groups federations. These federations regroup self-help groups on the district level and may go beyond. Each group has two representatives in the federation. These federations are created as a withdrawal strategy by the external actors, as when they initiate self-help groups they don’t intend to support them forever. Therefore self-help groups’ federations are meant to replace NGOs and government in order to insure sustainability for the groups that constitute them.

These federations will be responsible for creating self-help groups, getting funds, and training. Thus they play the same role as NGOs and government, more importantly they present a support for self-help groups, in the sense that women claims can be better voiced and addressed on a larger level. Federations also make sure that there is a market for the women in self-help groups to sell their products, and they offer many financial services. Therefore it would be very useful to examine these federations, their potential in strengthening the claim approach of self-help groups, and maybe move self-help groups to another level, where women are the holders of their own projects rather than driven by NGOs or government.

[1] When interviewing the CSA field coordinator, she told me that they only intervene in the groups matters when the issue is very serious, which questions the sustainability of self-help groups.

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