Arrange the following steps in the working of a Self-Help Group (SHG) in the correct order:
(A) Credit is given to the needy members
(B) Each member makes a minimum contribution
(C) The loan is repaid in small instalments at reasonable interest rates
(D) The contributions are pooled
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (B), (D), (A), (C)
An SHG works in four steps.
(B) Each member makes a minimum contribution.
(D) The contributions are pooled.
(A) From the pooled money, credit goes to needy members.
(C) The loan is repaid in small instalments at reasonable interest.
NCERT (2026-27): “5.3 Credit and Marketing in Rural Areas … Since some kind of collateral is required, vast proportion of poor rural households were automatically out of the credit network. The SHGs promote thrift in small proportions by a minimum contribution from each member. From the pooled money, credit is given to the needy members to be repayable in small instalments at reasonable interest rates. …” |