NABARD appoints FINO PayTech to start 700 SHGs in Bihar

With RBI making financial inclusion a priority, Self Help Groups (SHGs) will play a major role in spreading financial literacy and providing access to financial services in rural areas. NABARD (National Bank for Agriculture & Rural Development), which has been at the forefront of forming SHGs in various states, has awarded FINO PayTech, a micro banking technology service provider, a mandate to form and promote 700 SHGs in Bihar.
 
The 3-year project will have FINO PayTech identify members and form SHGs in villages of two districts of Bihar - Khagaria and Begusarai - with 350 group formations in each district. Each SHG would consist of 15-20 women in which office bearers are chosen unanimously out of the group and they manage the savings and lending of the group. An animator, appointed by FINO PayTech, not only facilitates the formation of the groups, but also ensures the group meets regularly, maintains the books of accounts and practices due diligence.
 
Mujahid Ahsan, vice president (Products), FINO PayTech said, "Our tech-enabled last mile delivery mechanism and our continuous efforts in the SHG space have been recognized by NABARD, thus partnering with us on this ambitious pilot. As an enabler of financial inclusion, FINO PayTech understands the role played by SHGs in this space and is keen to play a major role in SHG formation. We hope that soon even other banks will see the potential of this model as FINO PayTech is open to take mandates in other states with various public and private credit institutions. 
 
Working closely with over 80,000 SHGs across the country, FINO PayTech boasts that it can extend its expertise right to the formation stage of these groups. According to FINO, "the vast network of over 350 bandhus in these two districts of Bihar will ensure that fast and accurate services reach the doorstep of these SHGs.  FINO PayTech is proud to be a strong supporter of women in rural India who will drive the change in the rural economic scenario while making themselves self-sufficient in the process."
 
NABARD will review the performance on reaching 350 SHGs. Meanwhile, FINO PayTech is in talks with banks to start work on similar project in UP and Rajasthan.
 
Associating with FINO PayTech's Self Help Promotion Initiative (SHPI) would allow NABARD and SHGs the following benefits: SHG formation, opening of savings accounts for SHGs as well as individual members, tech enabled SHPI monitoring, facilitation of savings and loan transactions and facilitation of credit linkage of SHGs to bank. All these activities help provide a complete solution in SHG bank linkage for banks under a scalable, efficient and cost effective operation model.
 
It may be mentioned here that SHG-bank linkage model for credit has grown stronger in the last few years and NABARD has been actively pushing the cause of SHGs as a viable vehicle for inclusive growth.
 
SHGs are not only a source to save money but also have acted as a tool of social change. It has resulted in women gaining confidence and respect among their family and within their society.