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Group lending through an SHG bank-linkage programme in India: transaction costs and social benefits.
- Source :
- Development in Practice; Apr2020, Vol. 30 Issue 2, p168-181, 14p
- Publication Year :
- 2020
-
Abstract
- Group lending is useful in channelling credit to the self-employed poor in developing countries, to whom banks usually prefer not to lend, and formation of self-help groups (SHGs) helps facilitate this. In India, SHGs can access credit through private microfinance organisations or can approach banks through a state-led bank-linkage programme. Scholars argue that transaction costs are high while borrowing from banks despite relatively lower interest rates, making this uneconomical. This article uses a field survey to estimate transaction costs, presents other social benefits of the programme, and finds empirical justifications for strengthening the bank-linkage programme. [ABSTRACT FROM AUTHOR]
- Subjects :
- TRANSACTION costs
EXTERNALITIES
SUPPORT groups
INTEREST rates
Subjects
Details
- Language :
- English
- ISSN :
- 09614524
- Volume :
- 30
- Issue :
- 2
- Database :
- Complementary Index
- Journal :
- Development in Practice
- Publication Type :
- Academic Journal
- Accession number :
- 142799039
- Full Text :
- https://doi.org/10.1080/09614524.2018.1508418