Role of Non-Governmental Organizations in Microfinance through SHGs –A Study in Kanchipuram District of Tamil Nadu

Abstract

Non-governmental Organizations (NGOs) played a key role in rural reconstruction, agricultural development and rural development even during pre-independent era in our country. In the post independent period the NGOs became a supplementary agency for the developmental activities of the government and in some cases they become alternative to the government. After the introduction of microfinance through Self-Help Groups (SHG), they penetrated across India and actually are responsible for converting the pilot project of microfinance into a major program. The NGOs are responsible for making the microfinance through SHG as the largest program in the world. This paper analyzes the role of NGOs in sustainable rural development through microfinance. The study reports that NGOs are playing key role in the formation of SHGs and motivating women to join the groups and linking the groups with the banks for microfinance. But, Non-governmental Organizations played limited role in marketing the products of SHGs and release of subsidies.