A group of 20 women of the village of Benipur in Maharashtra have come up with an idea. They have started depositing a certain amount of money every month. If required, they can take loan from the same funds that they have accumulated. They have also come to know that if their savings are regular, they can even get a loan from the bank.

What is such a financial association called?

Bank

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Self-help group

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Moneylender

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Financial institute

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Solution

The correct option is B Self-help group
Self-help groups (SHGs) are small groups of people who come together and commit to pooling their savings regularly. Each member deposits a small amount and can be take out a loan if required. SHGs are popular among rural women. An SHGs as a whole can also take a loan from a bank once the funds are regular.

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