SGSY

1. Presented By IRMA students batch of 2013: Ankit Sharma (32005) Arpit Bansal (32009) Tanu Shree Shekhawat (32044) Tijil Thomas (32045) SWARNAJAYANTI GRAM SWAROJGAR YOJANA

2. INTRODUCTION (1/2) Programme name: Swarnajayanti Gram Swarojgar Yojana (SGSY ) Launched by : Government of India Date of launch : April 1, 1999. Objective: Broader Goal : Anti poverty programme (APP) and to generate self employment opportunities (Empowerment) Programme Specific : Self employment, Asset creation, Income generation and create access Strategy : To bring the assisted poor families ( Swarozgaris ) above the poverty Line by providing them income-generating assets through a mix of Bank Credit and Governmental Subsidy. Integrated programme of self employment through establishment of self help groups or cluster approach .

3. INTRODUCTION (2/2) There are two key aspects of the SGSY - Activity Clusters and the Group Approach. Launched by Restructuring : IRDP ( Integrated Rural DevelopmentProgramme ) TRYSEM ( Training of Rural Youth for SelfEmployment ) DWCRA ( Development of Women and Children inRural Areas) SITRA ( Supply of Improved Tool Kits to RuralArtisans ) GKY ( Ganga Kalyan Yojana )

4. IRDP vs. SGSY (1/3) S.No . IRDP SGSY 1 ‘Beneficiaries’: sense of benefit/grant to be enjoyed ‘ Swarozgari ’: sense of self – respect and entrepreneurship 2 financing ‘poorest of the poor.’ Financing those who are enterprising and are on threshold of crossing the poverty line. 3 Agricultural laborers, marginal & small farmers and rural artisans. All persons below poverty line (BPL) are in its ambience. 4 ‘Individual approach’ for extending the credit. Group approach’ for extending the credit ( 3:1 ratio) 5 Anyone can avail the credit ‘Training and capacity building only after which credit can be availed

5. IRDP vs. SGSY (2/3) S.No . IRDP SGSY 6 The selection of activity to be financed was left to the choice of the borrower. Financing can be done for only four to five ‘Key Activities’ selected by Block level SGSY committee. 7 No emphasis on project profiles There has to be ‘project profile’ for each activity to be financed. 8 The share of Centre and States was in ratio of 50:50. The share of Center and States modified to 75:25 9 No incentives to beneficiary for prompt repayment of bank credit. Only single time credit assistance only. No further finance for less than 80% recovery and rebate of 0.5% cum monitoring fee to all those Swarozgaris who repay their dues promptly. 10 Infrastructure and marketing linkages were overlooked in IRDP. Great emphasis on the infrastructure development in rural areas. Special fund by the name of ‘Infrastructure Fund’ has been created. 11 No role of local NGO’s and Panchayat Local NGO involved in imparting training and ensuring loan recovery

6. IRDP vs. SGSY (3/3) S.No . IRDP SGSY 12 Subsidy pattern according to the level of occupation and land status. Also The ceiling on subsidy was dependent upon area of implementation Subsidy pattern according to certain percentage of project cost. Subsidy independent of area of implementation. 13 No specific time frame SGSY targets at elevating 30 per cent of BPL families in five years. 14 No yardstick for incremental income generated under IRDP was defined. Yojna stipulates minimum income of Rs.2000 net of repayment for each Swarozgari .

7. TIME FRAME The SGSY is a process oriented scheme and SHG passes through different stages Time frame at each stage differs from district to district and state to sate depending upon spacial distribution and capacity of facilitator.

8. IMPLEMENTING AGENCIES The Swarnajayanti Gram Swarozgar Yojana (SGSY) is being implemented by the District Rural Development Agencies (DRDAs), with the active involvement of Panchayati Raj Institutions (PRIs), the Banks, the line departments and Non-Government Organisations ( NGOs)

9. FUNDING Centrally sponsored scheme and financing shared centre and state in the ratio 75:25 Of the total assistance: 50% for SC and ST 40% for women 3% for disabled person For special category states like north eastern states, centre shares 90% of the fund. Central allocation will be distributed as per the degree of poverty in the state. Devolution of funds to the districts will be indicated by the States and approved by the Government of India Government of India will release the funds directly to the DRDAs. DRDA receives funds directly from the state and conducts training, infrastructure and economic activities for a maximum of 10% of the fund . Devolution to the Blocks may be decided by the Governing Body of the DRDA based on level of poverty and other local factors. Funding exercise is done during the month of January.

10. FUNDING – RELEASE OF FUNDS The Centre releases funds in two installments Release of first installment without condition if second installment in the previous year was released without any condition else formal request is required The second installment of Central funds is released on the request of the DRDAs

11. ROLE OF PRIs, NGOs etc. Identification of the poor Capacity building & training Infrastructural Support Linkages of SHGs with Banks Marketing support Maintenance of record of SHG Monitoring and Social auditing Dissemination of best practices Engaging youths

12. FLEXIBLE DESIGN Demand driven strategy Dedicated support organization for NRLM Universal Social mobilization of the rural poor Building institutional platforms for the poor Training and capacity building Developing pro-poor financial sector Access to services and entitlements Linking with markets Risk Mitigation Convergence Gender empowerment Monitoring and transparency Building Skills and Capabilities Gender Strategies Access 2 Finance Access 2 Entitlements Access 2 Markets Building Institutions of poor

13. SALIENT FEATURES The SGSY aims at establishing a large number of micro enterprises in the rural areas, building upon the potential of the rural poor. The SGSY emphasis on the cluster approach for establishing the micro-enterprises . The SGSY adopts a Project approach for each Key Activity . The existing infrastructure for the cluster of activities should be reviewed and gaps identified Aims to cover maximum number of panchayats The assisted families may be individuals or groups (Self-Help Groups ) The Gram Sabha authenticates the list of Below the Poverty Line families identified in the BPL Census.

14. SALIENT FEATURES The group approach involves organization of the poor into Self-Help Groups (SHGs) and their capacity building . A credit-cum-subsidy Programme . Promotes multiple credit rather than a one-time credit 'injection '.   lays emphasis on skill development through well-designed training courses . Attempts to ensure up gradation of technology in the identified activity clusters . Provides information for promotion of marketing of the goods produced by the SGSY Swarozgaris . The SGSY is implemented by the DRDAs through the Panchayat Samitis .

15. PROCESS OF IMPLEMENTATION Organizing the rural poor into SHGs Inclusion of the poorest Assistance to take up economic activities Activity clusters Training and capacity building Provision of income generation assets Infrastructure support and technology Credit and marketing services

16. ORGANIZING AND SELECTING PEOPLE- FOCUS ON THE POOREST Mobilization of Swarozgaris -individuals or groups Subscribes to BPL list (BPL Census) approved by Gram Sabha BDO, Banker, Sarpanch visit to hamlets PROBLEMS Inclusion of non-poor Exclusion of the poor No foolproof method of selection

17. GRADING OF SHGs SHGs under SGSY are graded on the basis of performance Until the SHG has completed six months of existence it is categorized as Grade I At the end of the formation stage, which may be about six months or more, it is necessary to subject each Self Help Group to a test to assess whether it has evolved into a good group and is ready to go into the next stage of evolution i.e. Grade II Grading of the Self Help Groups could be done by the same agency that is involved in the promotion and development of SHGs or any independent agency contracted to undertake the grading exercise

18. FORMATION AND PROMOTION OF GROUPS WITH ASSISTANCE OF NGOs Emphasis on group approach rather than financing individuals Help of NGOs, CBOs and individuals in group formation (better equipped than govt.) Group formation- time and nurturing from a good facilitator (10-20 individuals in an SHG; one person part of only one group) In the case of minor irrigation schemes and in the case of disabled persons, this number may be a minimum of five (5) Group approach- clarity regarding the roles and design to the members Social mobilization enables the poor build their own organizations {Self-Help-Groups (SHGs)} in which, they participate fully and directly and take decisions on all issues that will help them in coming above the Poverty Line

19. PROBLEMS IN FORMATION OF GROUPS Selection of NGOs not transparent NGOs with limited experience in implementation Problem of coordination between NGOs and Govt. Some places of implementation- no NGOs Formation of SHGs- a time taking process Directions from state level to Village Level Workers(VLW) and district and block administrators to form SHGs Target-oriented approach not participatory process Lack of interest and understanding among members of SHG concept

20. FUNCTIONING OF GROUPS Once formed, groups do internal lending Trained by DRDA along with banks to develop strengths and saving DRDA access the group and grade Groups open savings account Accessing credit, subsidy and loan from banks SHG meetings and regular savings Maintenance of books of accounts PROBLEMS: Internal loaning/lending- “A Fake Exercise” Groups lacked cohesiveness Slack in SHG meetings and irregular savings Fake records

21. ASSISTANCE AND ACTIVITY CLUSTERS Block level selection of 8-10 activities Choice of activity- availability of raw materials, skills and aptitude of local people, traditional knowledge Selection of 4-5 activities based on preference Participants included in decision making Cluster approach (Consultative and Participatory process) PROBLEMS Non-participatory and Top-down approach For providing assistance, timely payment to NGOs not provided Lack of coordination between Govt., NGOs and Banks Lack of timely loans from banks to SHGs Lack of awareness regarding terms and conditions of sanctioned loans

22. TRAINING AND SUPPORT Training provided in the selected activities by DRDA Duration of training Training provided to fellow “ Swarozgaris ” Banks to provide “multiple doses of credit” rather than “one time credit injection” Support from PRI and Govt. departments regarding use of funds Adequate supply of inputs (backward linkage) Marketing linkage (forward linkage)

23. PROBLEMS IN STARTING MICROENTERPRISE AND USING TRAINING Supply driven not Demand driven Training provided in activities of non-interest Lack of quality training Non-availability of raw materials Problem in marketing of finished products Difficulty in procurement of raw materials

24. OTHER PROBLEMS SHGs created by other NGOs- problems between the 2 NGOs Banks do not cooperate with NGOs and Govt. Outstanding loan recovered from new loan by banks

25. PERFORMANCE AND EVALUATION

26. INVESTMENTS Total funds invested in SGSY since inception Rs. 14, 403.73 crores Overall credit disbursed as a proportion of credit targeted is 73% Disparities Northern States- 119% North-eastern States- 40%

27. SELF HELP GROUPS

28. PEOPLE

29. LEADING STATES

30. STRENGTHS

31. WEAKNESSES

32. SUGGESTIONS

33. Thank You