SHG-Banking under SGSY: An empirical investigation of bankers’ perceptions and problems in Jalpaiguri district.

Soumitra Sarkar


 In the modern age, banks play a catalytic role to serve the unbanked rural poor through the SHG-banking approach. Large numbers of groups have been formed under SHG-Bank Linkage Programme, under which banks deliver micro credit without collateral. It is a paradigm shift in the banking business where SHGs act as collateral for the bank. The group based microfinance schemes have been introduced by the banks to cater cost effective finance which is anticipated to decrease the banker’s burden of scrutinization of application, loan disbursals, monitoring and recovery of loan accounts. It is also anticipated that reduction in individual loan procedures is anticipated to reduce the cost to the banks, increase profits and small savings in rural areas.  It is envisaged that this SHG based microfinance approach shall bring proximity and affinity between bankers and rural people. banks were not only to act as a credit disbursement mechanism but also as financial intermediaries which attract more savings and stimulate internal banking by SHGs from internal and external bank sources to meet short-term emergent credit needs of their members. This group based microfinance system has created a new vistas for the bank staff and manager to interact with the rural vulnerable section specially women.  This study delves into the perception of bankers and problems faced by them in SHG Bank linkages under SGSY in Jalpaiguri district of west Bengal. This study has identified the Penetration of the Bank linkage programme, performance of the bank personnel and their perception about this programme in this district.


Microfinance (Mf). Self Help Groups (SHG). Swarnajayanti Gram Swarozgar Yojana (SGSY). Non Performing Assets (NPA). District Rural Development Cell (DRDC). National Bank for Agriculture and Rural Development (DRDC). Block Development Office (BDO). Integra

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