In an attempt to enhance financial inclusion in India through the use of information technology, NABARD launched a pilot project for the complete digitization of women's self help groups (SHGs). The project will benefit various stakeholders and will facilitate mainstreaming of SHG members with Aadhar based financial inclusion and through the Prime Minister Jan Dhan Yojana (PMJDY). Digitization will also bring transparency and credibility to operations of SHGs through inbuilt grading MIS. This will help increase the comfort of bankers in credit appraisal, disbursement, and monitoring. The process will also ease transfer of social benefits and direct benefit transfer leading to better participation of SHG members in PMJDY. There are over 74 lakhs SHGs in the country that have bank accounts, and out of this, around 42 lakh SHGS are credit linked and will benefit from digitization as and when the project is expanded across India.
Sh. Jayant Sinha, Minister of State for Finance, Government of India, advocated that NABARD should also launch a pilot project on credit intensification in select backward districts. He expressed confidence that NABARD will make best use of the Long Term Rural Credit Fund of INR 15,000 crore provided in Union Budget 2015. Dr. Harsh Kumar Bhanwala, Chairman of NABARD, highlighted that NABARD has taken this proactive step to address issues and constraints faced by the stakeholders of the SHG Bank Linkage Program (SHG-BLP) like need for improving the quality of interface between SHG members and banks, timely credit linkage of SHGs, challenges in book keeping by low literate clients, and convergence with other pro-poor government programs. He added that under digitization, base data of SHG's and their members will be captured in the system with periodicals updates of financial transactions including small savings, internal loaning, and their repayment.