1. By Professor (Dr.) M.M. Goel Dr. Virander Pal Goyal

2. Introduction Sustainable Rural Development (SRD) means desired changes in all components of rural life i.e., social, economical, technological, natural and political. Microfinance play a significant role in rural development by providing financial services such as microcredit, micro savings and micro insurance to the rural poor through Self Help Groups.

3. What is Self Help Group(SHG)? Group of 10-20 rural poor from a homogeneous class Volunteer themselves for addressing their common financial problems Agree to pool savings in a common fund known as ‘Group Corpus’ Make small interest bearing loans to members on rotational basis Group Corpus supplemented with ‘Revolving Fund’ sanctioned as cash credit limit by the banks Group could also have access to credit under the SHG- Bank Linkage program of NABARD

4. Objectives of the Study Objectives of our study are: 1. To analyze the socio-economic impact of Microfinance on the members of the Self Help Groups 2.To analyze the economic activities which have been undertaken by the members of the Self Help Groups 3. To assess the sustainability of the income of the members and their standard of living after micro credit 4. To analyze the impact on the empowerment of the rural women and their self dependency In light of the above four objectives, the basic research question of our study is: ‘What is the impact of Microfinance on the sustainable rural development and poverty alleviation in the State of Haryana?’

5. Methodology and Sample Design Based on Primary data State divided into two major climatic zones i.e. Eastern Zone and Western Zone representing Ambala and Hisar divisions Two districts from each agro climatic zones selected randomly for the study Multi stage random sampling method used for selection of the blocks, villages and ultimate sample of the SHGs

6. Techniques of Analysis Analysis of Variance (One-Way ANOVA) F = Estimate of population variance based on between samples Variance Estimate of population variance based on within samples Variance Paired comparison T-test (Representative samples) Chi- Square Test Multiple Regression Analysis Y = a + b 1 X 1 + b 2 X 2 + b 3 X 3 + ---------- b n X n Comparing before and after situations (i.e., Pre-post technique) Statistical analysis has been done by using SPSS 16.0 package.

7. Impact Assessment IMPACT = SATISFN + OBMICR + QLIFE + ASTIMPCT + ESTEEM + WEMP Where SATISFN stands for overall satisfaction from the scheme, OBMICR stands for objectives of microfinance, QLIFE stands for quality of life, ASTIMPCT stands for increase in number of assets, ESTEEM stands for confidence level and self respect and WEMP stands for women empowerment.

8. Findings Increase in the number of loan takers, amount of loan taken, income and number of assets owned by members Improvement in the standard of housing Increase in the level of annual income and savings

9. Findings Results of Regression Analysis show maximum impact contribution from size of SHG and improvement in group performance with age of the group. Amount of bank loan and education level of members also found to contribute significantly

10. Findings Results of overall impact due to different socio-economic variables show- - Caste and family type has overall impact significant at 1 % significance level - Age and education level has overall impact significant at 5 % significance level - Training and occupation has insignificant overall impact Income of the members has increased significantly after availing microfinance. The mean value of INCJOIN comes out to be 1.246 and the mean value of INCLOAN comes out to be 1.725. The difference of means is -0.4795 and t-value is -13.79.

11. Policy Implications There is a strong case of financing for Group Housing for the members of SHGs in the rural areas to solve the problem of housing Introducing saving and investment schemes at higher interest rates to motivate the members for saving and investment to help in increasing Marginal Propensity to Save (MPS) and Marginal Propensity to Invest (MPI) of the members Introduce micro insurance products and bring together various players in the insurance sector for supporting composite insurance products which could cater for life, health, crop, assets and accidents Older SHGs should be given more support in the form of training, marketing and infrastructure development so as to make them stand successful. Younger age members should also be given opportunities while forming SHGs Less educated members particularly the women feel more empowered after availing microfinance, they need to be taken on priority so that the objective of empowerment and social justice can be achieved

12. Policy Implications It is found that number of members in a Self Help Group was 10-12 in majority of the groups whereas the ideal number is found to be 5 I nstead of providing subsidies, loans at zero rate of interest should be provided to the beneficiaries on the basis of “Islamic Banking Model” and the financing bank may be compensated with this subsidy amount Diversification of economic activities from primary to secondary/ tertiary sectors particularly the manufacturing sector. Economic activities such as waste management, bio-gas, distribution of electricity, recycling the garbage, harvesting of rain water should be encouraged to achieve the objective of Sustainable Rural Development.

13. Policy Implications ‘Group Approach’ rather than ‘Individual Approach’ is found to be more effective Result oriented’ ’ rather than ‘Target Oriented’ Approach should be adopted

14. Conclusion There is a strong case for credit under rural group housing scheme. Loans for education and non-farm activities at low rates of interest instead of subsidies can help in achieving better results. It will help in making microfinance under SHGs a success story for achieving Sustainable Rural Development.

15. Thank You