The Role of Microfinance in Women's Empowerment: A Study on the SHG Bank Linkage Program in Hyderabad (Andhra Pradesh)

This study examines the relationship between self-help group/bank linkage program participation and women's empowerment.

Microfinance programs have been a key strategy in addressing development issues across nations since the last three decades. Women’s empowerment has became a critical pre-requisite for socio-economic development of any community. The study conducted a survey to capture the experiences and observations of the beneficiaries of Microsate, Hyderabad, who participated in an Indian Bank initiative that intended to improve the status of women. The study’s empirical findings suggest that:

• Microfinance influences the economic status, decision making power, knowledge and self-worth of women participants of self-help group (SHG)/bank linkage program;
• Availing microfinance loans and utilizing them productively causes significant differences in women empowerment levels as compared to women who did not borrow;
• Microfinance has limitations in reaching the poorest;
• Microfinance is effective in graduating the poor and lower middle class to a higher standard of living, but not the poorest.

The study acknowledges that microfinance plays a significant positive role in women's empowerment and in graduating poor people to a better standard of living.