RBI directs banks to step up hassle-free loans to Self Help Groups
The RBI on Monday directed all banks to provide adequate incentives to their branches in financing the Self Help Groups (SHGs) and establish linkages with them, making the procedures simple and easy. “The group dynamics of working of the SHGs need neither be regulated nor formal structures imposed or insisted upon. The approach towards financing the SHGs should be totally hassle-free and may also include consumption expenditures. Accordingly, the guidelines should be adhered to enable effective linkage of SHGs with the banking sector,” the RBI has stated in its master circular to all banks.