Given below are two statements: one is labelled as Assertion (A) and the other is labelled as Reason (R).
Assertion (A): Self-Help Groups promote thrift among their members.
Reason (R): Each member makes a minimum contribution, and the money is pooled.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Both (A) and (R) are true and (R) is the correct explanation of (A).
Assertion (A): Self-Help Groups promote thrift among their members. — True. SHGs encourage the habit of saving.
Reason (R): Each member makes a minimum contribution, and the money is pooled. — True. Every member puts in a small amount regularly.
Why R explains A?
Thrift means the habit of saving. When each member must make a minimum contribution to the group, members save regularly. So R shows how SHGs promote thrift.
NCERT (2026-27): “5.3 Credit and Marketing in Rural Areas … Recently, Self-Help Groups (henceforth SHGs) have emerged to fill the gap in the formal credit system because the formal credit delivery mechanism has not only proven inadequate but has also not been fully integrated into the overall rural social and community development. 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. …” |