India is a country with huge amount of diversification in all the segments. In a country like India, where the population is vast and is widely spread, providing financial services is not an easy task for the Government. Indian Banking Sector has taken an initiative to provide financial services to huge untapped population of the country by introducing the concept of Microfinance. Thereafter, Indian Microfinance Industry emerged as a driving vehicle in providing financial services to the rural population of the country. Microfinance services in the country are providing through two main channels a) SHG-Bank Linkage Programme (SHG-BLP) and JLG bank lending programme and b) Micro Finance Institutions (MFIs). Since its inception, many challenges are faced by the industry and yet the growth seems to be inescapable. This paper is an attempt to a detailed analysis of financial services provided by Self Help Groups during the past five years.

Key words: Microfinance, Self help groups, SHG – Bank Linkage programme

JEL Codes: D1, F63, G21, O16

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Dr. V S Sowmya Budampati