Université Paris-Dauphine

Mémoire de Recherche

Master 2 Recherche: Analyses et Théories du

Développement Durable

Année 2008-2009

An Understanding of Women Self-Help Groups in

India

Etudiant: Nabil ABDO

Directeur de Mémoire: M. Pierre MACLOUF

Le 15 Septembre 2009

1
Table of Contents

1. Acknowledgments ....................................................................................................... 3
2. Introduction ...................................................................................................... 4
3. Methodology and Theoretical Framework ....................................................... 9
4. Chapter 1: Governments and NGOs: representations and worlds of thoughts
behind the formation of self-help groups. ..................................................................... 13
4.1. Government as actor: Self-help groups as an alternative development strategy
or public policy instrument? .......................................................................................... 13
4.1.1. Self-Help Groups as an alternative development project. .............................. 14
4.1.2. Self-Help Groups as public policy instruments. ............................................. 19
4.2. NGOs as agents of empowerment or vehicles of a style of thoughts? ........... 25
4.2.1. Why NGOs chose women?............................................................................. 25
4.2.2. What is behind the concept of empowerment? ............................................... 30
5. Chapter 2: Self-Help Groups and the Logic of Collective Action ................. 39
5.1. Why does Olson‟s theory apply to self-help groups? ..................................... 39
5.1.1. How through self-help groups NGOs and government are shaping the
women‟s style of thoughts............................................................................................. 40
5.1.2. Does group size matter? ................................................................................. 45
5.2. Collective action in self-help groups: an “Olsonian” methodological
individualism ingrained in the Gandhian tradition. ....................................................... 50
5.2.1. Self-help groups: a combination of mechanisms governing latent groups and
the properties of small groups ....................................................................................... 50
5.2.2. Self-help groups: ingrained in the Gandhian Philosophy. .............................. 57
6. Conclusion. ..................................................................................................... 62
7. Bibliography .............................................................................................................. 66

2
 1. Acknowledgments

I would like to present my appreciation to all those who made this work possible,
especially my Professor Pierre MACLOUF who was always there when I needed
guidance and advice. Moreover I would like to thank all the women I interviewed in
Rajendranagar slum in Bangalore, as well as in the rural area of Hoskote who
overwhelmed me with their kindness, humbleness and welcoming spirit. I would like to
thank the staff of the Center of Social Action for making these interviews possible and

for providing me with translators who were always available when I needed them.

Moreover, I would like to express my gratitude to all my classmates in the

Masters of Social Work in Christ University who welcomed me, and considered me as
one of their own, thus providing me with the best ambiance to conduct my study. Their
friendliness, open spirit and understanding have made my journey in India extraordinary
and extremely enriching.

Finally I hope that my research will considered as a useful document that will
help to better understand women self-help groups in India by having a fresh and new
perspective on their logic and functioning.

3
 2. Introduction

Since its independence, India has been faced with the problems of poverty and
inequality. Being the second largest country in the world in terms of population, India
had always a huge mass of poor due to several factors mainly a long history of
colonization and exploitation by the former British Empire (our concern in this work is
not about the structural reasons of poverty and inequality). Hence the successive post-
independence governments have put alleviating poverty at the top of their priorities. The
strategies toward achieving this objective have ranged from a socialist to liberal
philosophies. The socialist model of state control and state-led and centralized projects to
alleviate poverty has failed, this failure was admitted upon the break-down of the soviet
empire, and the rise of neo-liberal policies in the late eighties of the past century.
Meanwhile, the micro-finance frenzy was at its dawn with the Grameen bank in
Bangladesh, this experience was in perfect harmony with the logic of neo-liberalism by
not rejecting the premises of free market and private enterprise, thus suggesting a solution
to address market failures by integrating the poor into the finance system.

The success of the microfinance model has been transformed by international

organizations to the magic formula for eradicating poverty in the world, and the United
Nations Development Agency and other development agencies, and even multinationals
have been liberating funds for this “revolutionary scheme” that will put an end to
poverty, and at the same time provide a major source of profit; the poor that were once
excluded from the financial market have become a huge source of a morally satisfying
profit. Parallel to the rise of microfinance, women issues, and gender issues have also
taken a huge step in the international arena, specifically in development agencies; gender
concerns have affirmed themselves as a main and inevitable subject while dealing with
development and poverty1. In fact, development practitioners and policy makers at the
international and local levels have put women at the center of their actions against
poverty and inequality, thus considered the fight against gender discrimination and for
1
The United Nations declared the years from 1976 to 1985 the women decade.
2
Palier, J. (2005). Defining the concept of empowerment through experiences in India. In I. Guérin, & J.
Palier, Microfinance Challenges: Empowerment or Disempowerment of the poor (pp. 35-55). Pondichérry:
4
gender equality to be at the heart of path towards social development. These
developments paved the way for the concept of women empowerment to emerge, and to
become the main word in the development jargon, and women have become the engine of
development.

One of the main conclusions of the microfinance experience was that empowering
women provides the best outcome for fighting poverty and bettering the socio-economic
welfare of the household since women are assumed to be concerned more about child
education, improving the conditions of the family when they generate more income2, thus
since the 1990s the main focus of development schemes have become centered on
women, hence hitting two birds in one stone: gender equality and poverty alleviation.
This brings us to the focus of our work: the self-help groups. Many forms of self-help
groups exist, and this notion differs from developing and developed countries. In fact
self-help groups are known in the developed part of the world as a group of people
having a common problem (alcoholism, anger, homeless) getting together to support each
other psychologically by talking about their difficulties and hence trying to overcome the
difficulties caused by their current situations, it is basically people trying to help
themselves through sharing experience. Nevertheless, the concept became wider in the
context of developing countries, especially in India which is the focus of this paper. In
fact self-help groups in India and other developing countries have transformed to being a
microfinance scheme of rotating savings and loans, in addition to the original concept
that we spoke about above. In India, the self-help group movement started in 1992 with
several NGOs initiating these groups in rural areas3 in order to improve the situation of

2
Palier, J. (2005). Defining the concept of empowerment through experiences in India. In I. Guérin, & J.
Palier, Microfinance Challenges: Empowerment or Disempowerment of the poor (pp. 35-55). Pondichérry:
Institut Français de Pondichérry.

3
Hofmann, E., & Marius-Gnanou, K. (2004). L‟empowerment des femmes entre relativisme culturel et
instrumentalisation dans des évaluations de la microfinance en Inde. Premières journées du GRES.
Bordeaux IV.

5
women and of the rural communities. Therefore, self-help groups became in a vast
majority as a group constituted solely of poor, disadvantaged women, generally from
lower castes who are being brought together to be able to get loans and to conduct some
services and improvements in their communities.

The idea of a self-help group is simple: an NGO or the government in a poor area
be it slums or neglected villages, goes and sets up a self-help group constituted of 15-20
women. These women save weekly a small amount of money in a common pool with
very low interest (1%) and they also borrow money from this common pool with a 2%
interest. The difference between this scheme and the traditional microfinance practice is
that the money stays in a closed circle, the group, which means that the women don‟t
seek microfinance institutions in order to borrow money, but they borrow from their own
money that they save weekly. Nevertheless there is a self-help group –bank linkage in
order for the women to be able to put the saved money in the bank or borrow a
considerable amount to add to the existing pool. However, what distinguishes those
groups is that women take up services for the community such as starting a health center
in the area, waste management schemes, nursery for the children, and other types of
actions that serve the community. The self-help innovation has constituted a success to
the extent that the governments in the different states in India have started their own self-
help groups that take up the same work as the NGO initiated groups.

NGOs and governments see the self-help groups as an efficient way to enhance
decentralization and local governance at the most grass root level. In a matter of fact,
India has committed itself to decentralization since more than two decades through the
activation of the local governance bodies, especially the Panchayati Raj institutions that
are a sort of municipal boards at the village level, but also women have been given a one-
third quota in these institutions. Hence the self-help groups meet both the ambitions of
the state of India to decentralize at the biggest level possible its institutions in order to
increase participation and the democratic vocation of the regime, but they also meet the
new dominating concepts in the current development paradigm which we will speak
about. The self-help groups are now the most popular invention in India amongst NGOs
and government and are considered as an efficient and innovative way to fight poverty,

6
gender discrimination, and to improve and enhance the practice of democracy in India,
and to overcome corruption and government inefficiencies in implementing public
programs. The latter point is very important as we shall see later, since it is now observed
that the government is delegating many programs to the women in those groups in order
to implement public works like neighborhood upgradation, road maintenance and other
responsibilities that the government used to do, and that in the name of fighting
corruption and increasing participation.

This phenomenon of self-help groups is quite interesting to study since it has

become an authority in development works, and it is considered by NGOs and state
governments as way of meeting the millennium development goals, and one of the best
ways to better local democratic governance, and fight poverty. Moreover, donors
agencies are also fan of this concept and hence don‟t hesitate to give funds to the NGOs
willing to start up these groups, since they have proven to be financially viable and
sustainable. The self-help scheme is thus considered a flawless way towards development
and empowerment of women and disadvantaged communities. According to their
advocates, the self-help groups allow women to have bargaining power with their
husbands and the local authorities, when they are united, they can help each other against
domestic violence, economic difficulties and overcoming the inherent disadvantage they
have in society. Hence self-help groups began to spring in an exponential manner( in
2004 more than 1 million self-help groups were present, over 90% of which are
composed of women4).

What is interesting about this phenomenon is that while it is being highly praised,
it is not a local initiative, i.e. it is not the women of the community who took the step to
organize themselves, but it was the NGOs and the state governments who gathered the
women in order to get together in one solid group. From what precedes, we have
elaborated our research question which is: how do the women Self-Help groups in India
function as small groups according to Olson‟s typology in his path-breaking book “The
4
Hofmann, E., & Marius-Gnanou, K. (2004). L‟empowerment des femmes entre relativisme culturel et
instrumentalisation dans des évaluations de la microfinance en Inde. Premières journées du GRES.
Bordeaux IV.

7
Logic of Collective Action”5? In order to answer this question, we will examine the
different actors involved in this microfinance innovation. The actors of our interest are
those who are involved in the formation, functioning and sustainability of these self-help
groups who are: the women self-help groups, the non-governmental organizations
(NGOs) and the government who are responsible of the creation of these groups.
Therefore it would be essential to ask the following question: what are the reasons and
logic that those two actors follow in order to form these groups and what are the
representations that they hold of these groups? Moreover, as mentioned earlier, these
groups are not self-initiated by the women themselves, but they are launched by external
actors, i.e. NOGs and government: having a common interest, why didn‟t these women
form the groups by their own initiatives?

In the following passages, I will argue that the functioning logic of the self-help
groups obey in a direct way to Olson‟s theory on collective action which contends that
people do not organize themselves and engage in collective action in an automatic way
when common interest is involved. Instead, mechanisms of selective incentives and
coercion are involved in order to have a collective action and a sustainable organization.
My research will be divided in two chapters: the first chapter will deal with the external
actors as presented above, in which we will try to understand their different roles,
representations and logic they have. We will argue that despite the ambitious
development aspiration behind creating self-help groups, the government is playing a role
in instrumentalizing those groups hence becoming more a tool for development rather
than actors of development. Moreover we will try to show that NGOs, through the used
development concepts, like empowerment, they are transmitting the style of thoughts6 of
international institutions, like the World Bank , to these groups therefore influencing their
functioning and logic. The second chapter will deal with the self-help groups themselves
where we will see how the external actors play a crucial role in rendering these women

5
Olson, M. (1965). The Logic of Collective Action. Cambridge: Harvard University Press.

6
Douglas, M. (1986). How Institutions Think. New York: Syracuse University Press.

8
apt to the reasoning of methodological individualism, applying a cost-benefit analysis to
their mindset. Through this chain of thoughts we will conclude by examining these
groups according to Olson‟s theory of collective action.

3. Methodology and Theoretical Framework

The methodology followed in the research is a qualitative one and based on the
collection of documents and works dealing with the subject matter. It consists of
conducting interviews with women members in the self-help groups from the urban slum
of Rajendranagar in the city of Bangalore, and also interviews with the rural women in
the country side of Bangalore in order to spot the differences in conducting their actions
and also the NGO approach. Interviews were also made with people working in the NGO.
The bulk of the work is with the Center of Social Action, an NGO based in Christ
University in Bangalore. The choice of the NGO was not within my control since I was
doing a semester exchange in Christ University hence the Center for Social Action was
the only NGO I had access to. Moreover when I requested that I be connected with other
NGOs, the responsible in the Center for Social Action said that it won‟t be a problem and
kept stalling for a long time to give me an answer until when it was too late they told me
that it is not possible to interview other NGOs due to the fact that the others refused from
fear of competition.

I will try to fill this gap by literature work on other NGOs in India dealing with
self-help groups. nevertheless this is not the only shortcoming in my research, in fact my
dependency on the Center for Social Action was an important obstacle for me since their
processes were slow, the personnel was not fully cooperative since every time I had to
request an interview with a self-help group it would take several weeks in order for it to
be arranged and this was a huge setback for my research due to my short time of stay in
India. Another factor that hindered the process of my research was the language barrier,
as in India the national languages are Hindi and English, however poor people don‟t
speak English and speak a bit of Hindi which I can‟t speak. Thus the interviews were in

9
Kannada (local language of the state of Karnataka), Tamil (local language of the state of
Tamil Nadu), or Telugu (local language of the state of Andhra Pradesh). Therefore I had
to speak through an intermediary who was an employee of the Center of Social Action
which presented a double disadvantage: first I could not get directly what the interviewee
was saying because we were communicating through a translator, hence I could not know
if she was conveying to me everything that was said by the women: sometimes she would
summarize what the woman said, sometimes she would answer on behalf of the woman
as she considers the answer to my questions are obvious, or she could add up to what the
woman was saying.

The second obstacle was that since the translator worked for the Center for Social
Action, the women interviewed might not say everything they have in mind out of
precaution, fear or respect to the NGO sponsoring them, or they would say and reiterate
the rhetoric of the Center for Social Action in order to please the representative or to
prove that she had assimilated and integrated the notions on which she was trained.
Adding up to that, the fact that I had little time for me to gain their full confidence, but
also they were not available for a long time since I had the chance to meet them for
twenty minutes as they were in their break time and they had to go to work. Hence the
interviews were somehow brief to the time constraint and to the fact that there had to be
translation so the interviews were taken double the time they required. Moreover the
NGO personal always denied the presence of a caste problem within the groups or their
communities and even told me not to speak about the subject to the interviewees which
prevented me from dealing in depth with the caste factor in the actions of the self-help
groups.

Nevertheless it must be noted that the translator was trying to be helpful and gave
me her fulltime while I was visiting, and was very nice and welcoming. Also, the women
I interviewed were not suspicious of me, and were very willingly ready to give conduct
the interview, and were talkative, and answered every question I head with no hesitation
or a sign of resistance. I find it important to mention that I was overwhelmed by the
kindness, simplicity and humbleness of these women as they were very welcoming and
some of them shared with me some personal problems they had. A last factor that

10
blocked the process of my work was the poorly equipped libraries in the city and in the
university: the university library is equipped with only a couple of shelves of sociology
books, and the bookstores in the city didn‟t even have a sociology section, hence the non-
availability of books was an important problem for my research. Despite the many
obstacles I encountered that may have caused many flaws in my research I tried to fill all
these gaps with the many of papers written on this subject that have taken over the
spotlight in development work.

The theoretical framework I will be using will be a combination of Mancur

Olson‟s work embodied in his book “the logic of collective action” and the work of Mary
Douglas through her book “How institutions think”7. I will use Douglas‟ work in order to
analyze the external actors influencing the self-help groups. In fact, Douglas incorporates
Fleck‟s theory in her book, in which she argues that institutions circulate a style of
thoughts according to which individuals think and act. This concept will be used in order
to explain how NGOs and government are changing the mindsets and attitudes of the
women in question in this study, and in order to understand the factors that inhibited
women from organizing themselves. Olson‟s theory, which is the main support of my
research, argues that people don‟t conduct collective actions and build organizations for
the only reason of having a common interest, but they engage in different mechanisms of
coercion and selective incentives in order to make the collective action possible. Hence
through the combination of these mechanisms, rational individuals will engage in a cost-
benefit analysis on whether to decide to engage in such endeavor.

Olson makes a difference between large and small groups and asserts that the
mechanisms we spoke about above are not needed for small groups. However, Douglas
will extend Olson‟s theory to small group which supports our research question and
findings. Hence this combination of Olson‟s and Douglas‟ work will enable us to
understand the functioning of the self-help groups which is deeply affected by the
external actors we already spoke about. The contribution of these works will be detailed

7
Douglas, M. (1986). Op .cit.

11
and presented in more length in the coming passages. However, it should be noted that
Douglas‟ work is used in our research in order to support Olson‟s theory to be applied on
self-help groups and in order to understand the role of NGOs and government in the
process.

12
 4. Chapter 1: Governments and NGOs: representations and
worlds of thoughts behind the formation of self-help
groups.

In this first chapter we will be dealing with the actors involved in the formation,
support and sustainability of self-help groups, i.e. governments and NGOs. The chapter
will be divided in two parts; each part deals with a different actor: the first part will deal
with the government (or state government as India is federal state) and the second part
will deal with the NGOs. We will see through this chapter the different usages and
representations that these two actors have of the self-help groups.

4.1. Government as actor: Self-help groups as an

alternative development strategy or public policy
instrument?

The government is a main actor in initiating self-help groups but also in providing
a suitable institutional environment to foster and host these groups. The fact that the
government has embraced this scheme, and used it as a main tool for social development,
has helped to boost this movement in order to become now the major policy used to
alleviate poverty and empower the poor. Hence it has adopted it as a continuation of the
decentralization logic used in order to reach the poor in the country. However as many
schemes and projects that first seem benign and ambitious, self-help groups have a great
chance to slip towards becoming instrumentalized and a mere tool in order for the
government to delegate its responsibilities to individuals at a much lower cost, and hence
self-help groups became solely civil servants instead of becoming a powerful movement
towards changing the reality of the poor. In the following passages we will examine
theses aspects of self-help groups as promoted by the government.

13
 4.1.1.Self-Help Groups as an alternative development
project.

As stated in the introduction, India is a country on which colonization had

considerable impact. In fact, the Indian society is marked by a very hierarchical social
system embodied in the caste system which is very complex. This system places the
Indian society in a very rigid hierarchy, where social mobility is rendered very difficult.
The caste system dictates a social division of labor where every caste has a certain set of
jobs assigned to it according to its place in the hierarchy. Hence the lower the social
group is placed in the system, the lower status jobs are meant for this group (reference).
Nevertheless, this rigidity was not present in pre-colonial India, but instead it was
accentuated during the British colonial rule. In fact, “castes and religious communities as
we know them today are very much a product of enumeration, classification and
categorization by the colonial state in the nineteenth and twentieth centuries”8. Therefore,
at the dawn of liberation, the independence political establishment inherited a more than
ever rigid hierarchical societal order that was in contradiction with the egalitarian and
democratic vocation of the post-independence political system9. The political
establishment, hoped that this contradiction will soon fade away with end of the colonial
rule, eventually this didn‟t happen10. Hence, the successive governments continuously
launched programs targeting lower castes in the aim of overcoming this contradiction
between the social system and the political one.

The government support for Self-Help groups comes in line with these poverty
alleviation programs. The difference is that before the 1990s, the programs were more
interventionist and were mainly characterized by a high level of subsidies, and hence the
self-help groups marked the government adoption of a participative approach, where the
8
Randeria, S. (1999). Entangled histories of uneven modernities: Civil society, caste solidarities and legal
pluralism in post-colonial India. Theory, Cultural and Society. London.

9
Beteille, A. (1999, March 6-13). Empowerment. Economic and Political weekly .

10
Ibid.

14
women through self-help groups are considered to be an integral part of the local
development process away from the decisions of the central government11.

The Indian government‟s target population moved from the lower castes in
general to women in these castes. In fact, women are considered to be the oppressed
within the oppressed, that is where an individual is disadvantaged by being a part of a
lower caste, a women who is in this low caste has a double disadvantage: first for being
underprivileged due to her place in the social hierarchy, and second due to being a
women, the inequalities in the Indian society is played along the lines of caste and
gender12.

The Indian government soon recognized the importance of targeting women

through its successive five-year plans since 1979. In fact, from 1979 onward the Indian
government started including women in its targets in the centralized plans. Hence women
moved from being considered as an essential part of rural development (the 1979-1984
Five Year Plan) to a situation where the Five Year of 1997-2002 Plan13 committed itself
to empower women as agents of social change and development, to create an enabling
environment for women as equal partners with men, where women can freely exercise
their rights both within and outside home and to be organize into self-help groups
marking the beginning of a major process of empowerment (section 3.8.27). Government,
however, plays a passive and indirect role in self-help groups formation and
functioning14. This strategy was continued in the 10th Plan (2002–07) with the
government committed “to encourage self-help Groups mode to act as the agents of

11
Hofmann, E., & Marius-Gnanou, K. (2004). Op. cit.

12
Beteille, A (1999). Op. cit.
13
The Government of India. (1997). Ninth Five Year Plan, 1997-2002. New Delhi: The Planning
Commission of India.

14
Sabhlok, S. G. (2006). Self-Help as a Strategy for Women's Development in India. 16th Biennial
Conference of the Asian Studies Association of Australia. Wollongong.

15
social change, development and empowerment of women”15. As we can see the
government explicitly declared its adoption of the self-help group enterprise. Moreover,
due to this policy choice of the government of India, nowhere else in the world does a
microfinance scheme have this institutional support and enabling environment which is a
crucial element in the flourishing of self-help groups16.

Thus the biggest rural development program in India, the Integrated Rural
Development Program (IRDP) introduced in the 1980s -and aiming to provide access to
institutional credit to every person under the poverty line- was replaced by SGSY
(Swarnjayanti Gram Swarozgar Yojna). The latter was introduced in 1999 and has the
same objective as the former, but modifies the conditions to the access to credit. The
major change lies in the fact that the logic has shifted to be a collective one instead of
individual one accused of being the source of the failure of the IRDP. Hence the program
adopts the self-help group concept through its collective nature in order to permit the
acquisition of credit. Therefore we see that the government of India has taken self-help
groups as the major tool for social development. Thus the Chief Minister of Tamil Nadu,
Selvi J. Jayalalitha, declared: “a silent economic revolution has taken place in rural areas
of Tamil Nadu following empowerment of women with the formation of self-help
groups. […] The self-help groups gave women a "top status" in society and they were not
dependent on men anymore”17.

However it is useful to examine the logic behind the adoption of women self-help
groups as the panacea for development and poverty alleviation. This attitude by the
government has different assumptions that range from: economic growth, to
empowerment, participation and democracy. Let us examine each of these criteria.

15
The Government of India. (2002). Tenth Five Year Plan, 2002-2007. New Delhi: The Planning
Commission of India.

16
Guérin, I., & Palier, J. (2004, May 25-27). Les Self-Help Groups en Inde du Sud en tant qu'espaces de
discussions et d'actions collectives permettent-ils un accès à plus de "pouvoirs". Communication présentée
aux XXèmes journées ATM-CREDES . Nancy.

17
Sivaganga, C. (2004, March 24). SHGs have ushered in rural economic revolutions. The Hindu .

16
 As stated before one of the major concerns of the Indian political system is to
reduce the gap between the egalitarian vocation as stated in the constitution and the
hierarchical social system. Hence one of the aims of self-help groups is a further
decentralization of decision making to the most local level, and also to encourage women
in order to participate in the public life. This logic is inserted in the principle of
participatory development where the beneficiaries of the programs are themselves
involved in the process of implementation. Hence since the 1992, 72nd and 73rd
constitutional amendments- where women are granted a one third of the seats in the
Panchayatis Raj Institutions that are the local governance bodies at the village level- self-
help groups are being mobilized in order to encourage women to run for the local
elections18.

Moreover, groups are intentionally made informal and in a small size in order to
avoid their association to the practices of bureaucracy and corruption19. Those
characteristics have long been those of the public authorities dealing with these categories
of people. Therefore the self-help groups provide the opportunity for women from the
lower casts who have been long excluded from local governance in order to become a
member of the Panchayats20. These groups are meant to reintegrate women into the
public space.

Moreover, one of the main recommendations when forming a self-help group is

that the members be from a homogenous social background21 which means belonging to

18
Kovacs, A. (2005, April 21). NGOs, Women‟s Collectives and Women‟s Empowerment In India. Thesis
handed to Prof.Buckland .

19
Sabhlok, S. G. (2006). Op. cit.
20
Pant, M. (2004, December). Potential of Self-Help Groups for Enhancing Participation of Women in
Local Self Governance. New Delhi, India: PRIA.

21
National Bank for Agriculture and Rural Development. (n.d.). A handbook on forming Self Help Groups.
Retrieved July 27, 2009, from http://www.nabard.org/pdf/publications/manuals/formingshgs.pdf

17
the same caste. This attribute will allow the government to better channel the public
programmes22. As it is well known, a person who belongs to the Scheduled Castes or to
Other Backward Caste doesn‟t benefit from the same public program or to the same
positive discrimination measures with respect to certain employment opportunities,
therefore self-help groups constitute an effective intermediate for government programs
to reach the targeted population. However this has the danger to reinforce caste identities.

One last motivation behind government support and formation of self-help groups
is the fact that gender discriminations and inequality impact the economic growth of the
country, as the female part of the country is excluded from the contribution to production.
Therefore women should be helped due to their role in development; investing in their
capabilities and expanding their choices is not only valuable as an end by itself, but it is
also a certain way to contribute to economic growth and development23. But also women
are assumed to make better use of the resources for the well being of the family, which is
expenditure for food and health. Men in India are accused of spending their money on
gambling and alcohol. Therefore giving more income to women will have a multiplying
effect on the family as a whole. Therefore it would be wiser to target women than men in
microfinance project. However, by having this assumption, there is a risk to reinforcing
this view and adding more burdens on the woman as the sole responsibility bearer in the
family. As we will see later, governments and non-governmental organizations share
many views and assumptions while initiating self-help groups. In a matter of fact we will
later show that these actors assert a certain “style of thoughts24 that the dominant social
institution in India holds, which is contradictory to the claims of social change that these
actors declare to advance.

Through these assumptions, the frame of thoughts held by social institutions are
also shared by the political institutions governing the country, hence circulating a role
already played by the Indian woman as the main person holding most responsibilities in

22
Guérin, P & Palier, J (2004). Op. cit.
23
Palier, J (2005). Op. cit.
24
Douglas, M (1986). Op. cit.

18
the household embodied in taking care of the well being of her family. This theory
developed by Fleck and later used by Douglas to explain the functioning of institutions in
a certain society is crucial to our analysis in order to understand how external actors (in
this first part, the government) are affecting the functioning of self-help groups and the
impact they have on women. The style of thoughts that the government hold is not alien
to the structure of society as it is a part of it. However, we shall see that since the
economic change towards neo-liberalism launched in the 1990s, the governmental actor
intersect the style of thoughts we talked about with the one of international institutions,
rendering the women in these groups as agents for the implementation of this new
economic rationale. Not only this assumption leads to this risk, but we will see in the
coming passages that government programs aiming at increasing democratic
participation, social development, etc... are adding more responsibilities to women,
rendering them as unpaid civil servants.

4.1.2.Self-Help Groups as public policy instruments.

As we have seen in the previous section, self-help groups have been an essential
and main part of the government‟s strategy to enhance social development and well being
through a participatory approach in which self-help groups are at the same time the target
and vehicles of this scheme. However, it is useful to ask: is this an element contributing
to building the capacities of these women, hence give them power, i.e. empowering them
(we shall examine this concept in the second part of our first chapter) as NGOs and
government claim or are self-help groups an alternative way to implement public policies
in a cost-free manner?

Besides the fact that the self-help groups are called upon in order to encourage
women to participate in local governance through running to elections at the village level
in order make the constitutional reforms we spoke about earlier more effective and better

19
implemented, these groups of women are also the vector through which the government
communicates its programs25. Hence, the government devolves the responsibility of
informing the local populations about the new schemes created in their favor to the self-
help groups. What lies behind this logic is that government institutions for local
governance are characterized by corruption and redtapism and have proved to be
inefficient. Therefore following the rationale of participation and decentralization dictates
that in order to implement the programs, the government has to rely on community based
organizations to render the application of the schemes more efficient since through this
devolution of responsibilities people will feel more involved and therefore will adopt the
programs with less resistance due to the assumed absence of corruption when self-help
groups women are responsible for this task26.

Women in self-help groups do not only serve as an information vector for the
local populations to which they belong, but also they conduct work deemed under the
umbrella of community development. In a matter of fact, the now-dominant paradigm in
the development work and strategy concentrates heavily on community development
contrary to development by itself. This shift in vision implies that the community
development is the one which has a participatory approach instead of the implementation
of projects by the central government without the agreement of the people in the locality
involved. Hence, participation means that the local populations have to be involved in
every part of the process, starting from planning to implementation27.

25
Guérin, I., & Palier, J. (2005). General Introduction. In I. Guérin, & J. Palier, Microfinance Challenges:
Empowerment or Disempowerment of the poor? (pp. 15-35). Pondichérry: Institut Français de Pondichérry.

26
Harper, M. (2002). Self-help Groups and Grameen Bank Groups: What are the Differences. In T. Fisher,
& M. Sriram, Beyond Micro-Credit: Putting Development Back into Micro-Finance (pp. 169-198). New
Delhi: Vistaar Publications.

27
During our stay in India, this concept of participation and its importance as well as involving the
community in every step of implementing the project was at the center of the community development
courses we took. This approach is called a bottom-up approach as opposed to the top-down approach that
was being implemented before through government development programs.

20
 This approach as we said claims to give power to women, however in the name of
this very principle, women in the self-help groups are assigned tasks relating to public
works in development that is normally an integral part of the government‟s function.
From what follows, we observe in many areas that self-help groups are conducting
programs that were formally the responsibility of the government. Hence in the name of
community development, women are called upon and mobilize in order to conduct some
tasks like: cleaning the locality‟s roads as well as the village school; building
infrastructure like bridges in order to be connected to other localities; launching adult
literacy programs; launching hygiene and sanitation campaigns in their localities, assist
the government in immunization campaigns, and many more sorts of works. In Hoskote
village that I visited during my field work, the self-help groups have started a community
center in which after school lessons were given to the children as well as a sanitary center
for people to be treated28.

Self-Help groups also held the function of public providers of goods: for example,
in the 10 districts of Preambalur, ten self-help groups have been identified in order to
provide food for the canteens in schools as well as other things with relation to public
utilities. Moreover, every year, self-help groups are assigned to organize celebrations and
events in the international day for women held in March of every year29. This day is
usually used as an opportunity to conduct community development programs, thus these
women are the first to be mobilized for such events and to have community development
initiatives. Moreover, most self-help groups, like the ones I visited in the rural
surrounding of the city of Bangalore, are mobilized for maintenance work in their
communities such as cleaning water reserves, or management of common resources in
the community.

28
Bali Swain, R. (2007). Can Microfinance Empower Women? Self-Help Groups in India. In A. Dialogue,
Microfinance and Gender: New Contributions to an Old Issue (pp. 61-83). Luxembourg.

29
Guérin, I. & Palier, J. (2005). Op. cit.

21
 Many more community projects are taken up by the self-help groups, moreover
these initiatives are considered as voluntary effort by these women who are seen as
enthusiastic to perform them in order to advance in the community and to assert
themselves. Therefore we observe here that those women are taking the role of
government officers and civil servants who were formerly conducting these tasks, but the
only difference is that they are performing this work for free. Thus we see that the
government through the self-help groups is slowly withdrawing from its role as a
provider of social services and maintaining infrastructure in these areas by delegating
them to these women who are made the agents of development, this is done in the name
of empowerment and participation. Through this procedure the government is getting out
of the public arena, thus obeying to the newly adopted logic of neo-liberalism by cutting
on public expenditures and applying the principle that people ought to help themselves
rather than being provided assistance by local authorities.

The women in self-help groups are therefore mobilized according to this logic and
principles, by conducting the tasks we spoke about in the above paragraphs they are
adding up to their responsibilities and burdens. Women have become not only the bearers
of the difficult task to ensure the well being of the household through getting credit by the
intermediary of self-help groups, but also they became the main and most important
actors in enhancing the well being of their localities. As we will see in the following
passages, even the productive work they are performing through acquiring credit from the
self-help groups are burdening up their livelihood, hence the community development
work is added up to their laborious day. Once again, the style of thoughts circulated to
these women is essential to the work of self-help groups as well as to the perceptions of
themselves as holding the duty to provide service for the community.

In fact, many researchers in the field argue that self-help groups under a neo-
liberal economic regime not only add up to the burdens of the women involved, but they
also accentuate their exploitation by the local and global capital in the framework of the

22
current economic system. Mohanakumar and Susan George30 in a study in villages from
the southern state of Kerala showed evidence about the phenomenon mentioned in the
above lines. They studied the effect of the policies of a government devoted to applying
neo-liberal economic principles in enhancing self-help groups, those principles were set
by the World Bank. The two researchers showed that the government was in tune with
the directives of the World Bank by increasing the strictness with regards to allotting
fund to the self-help groups. Hence groups who had women who were not under poverty
line were excluded from funds. This distinction and demarcation between self-help
groups “has gone a long way in crippling the effective functioning of self-help groups. In
fact, this clause in the decentralized planning process led to the disintegration of self-help
groups and micro –enterprises”31.

Moreover, the authors note that as a result of following the neo-liberal agenda,
bureaucrats replaced social activists who were “the major driving force in organizing
32
women for self-help groups and micro-enterprises” which suppressed the elements of
participation in the process of decentralization. Moreover, this new logic has lead to the
increase of burdens on these women‟s shoulders, and also accentuating their exploitation.
The study shows through the example of a self-help group engaged in a micro-enterprise
for producing umbrellas: a woman would work more than 10 hours a day in order to
make 5 umbrellas, and the price of umbrella was valued at 105 rupees while the women
were paid a wage of 25 rupees a day. These women were originally engaged in
agricultural labor, hence the move towards a micro-enterprise was supposed to boost their
income. Nevertheless the agricultural laborer earned 120 rupees which is 6 times more
than in the umbrella business. Therefore through this example, we can see how women
exploitation is being accentuated under a neo-liberal regime.

30
Mohanakumar, S., & Susan George, S. (2005). Micro Enterprises of Self-Help Groups and State Policies
under a Neo-Liberal Regime: Evidences From a Village in Kerala. In I. Gérin, & J. Palier, Microfinance
Challenges: Empowerment or Disempowerment of the Poor? (pp. 97-113). Pondichérry: Institut Français
de Pondichérry.

31
Ibid.
32
Ibid.

23
 When following the framework of analysis we spoke about above, self-help
groups who are inscribed under the microfinance movement are a way to provide the
poor with credit, hence they become credit worthy. This follows the international
institutions and donors‟ paradigm, like the World Bank. Therefore self-help groups
become a strategy to minimize the role of the state in the provision of basic services and
at the same time transform women into entrepreneurs in order to have a hosting
environment for investment and production. like the researchers mentioned above, by
taking the example of the state of Kerala, we can go as far as saying that the self-help
groups have been an innovative device in the hands of global donors, and capital holder
in order to restore an exploitation of the type of the nineteenth century as observed with
the difference between the wage of women and the price of one umbrella produced.
Hence women are being overburdened and their wage labor exploited in the name of
giving them more power and capabilities33.

The logic mentioned above aims at turning women in self-help groups as

entrepreneurs, able to prove and demonstrate that they are financially disciplined in order
to be accorded loans. The paradigm and framework through which the self-help groups
are formed and functioning is circulation a certain style of thoughts to these women by
introducing the concepts of financial discipline, entrepreneurship, etc... However, while
the government is devolving responsibilities to self-help groups and withdrawing from
the provision of social services, the NGOs are in the front line of this project and the
main holders of this style of thoughts. In the following pages we will take our analysis to
the next important actor with regard to our subject of research, NGOs.

33
Ibid.

24
 4.2. NGOs as agents of empowerment or vehicles of a style
of thoughts?

In our second part of this chapter we will be dealing with another essential agent
in initiating, forming and shaping the self-help groups, non-governmental organizations.
As we have seen in the previous section, the government withdrawal strategy is coupled
with its reliance on NGOs who are put in the front line of development work. These
actors are now the most important holders of the self-help groups project and it is
unavoidable to examine their work and logic. In the following passages we will first
examine the assumptions that the NGOs hold of women in order to make them the main
stakeholders in their project, through them affecting the women themselves. Then we will
examine the concept of empowerment that has become the key concept in the
development work. The concept was adopted in a very early stage by NGOs and put it at
the center of their philosophy and action. Therefore we will try to see how this concept
found its way in order to be used in this orthodox matter as the magic solution to poverty
alleviation, and we will observe which style of thoughts is disseminated through the
panacea of empowerment.

4.2.1.Why NGOs chose women?

The overwhelming majority of self-help groups are composed of women, there

are some men self-help groups but not as widespread and praised as those constituted of
women. Men are not deemed suitable for this scheme because many of the men groups
have failed and the actors involved in forming them have given up on targeting them.
Women self-help groups have been very successful and praised by governments, NGOs,
donor agencies and international organizations like the United Nations and the World
Bank. Therefore it would be essential to ponder about this phenomenon, and to ask
ourselves about the assumptions that these actors hold while targeting women.

25
 Non-governmental organizations share some of the perceptions that the
government hold about the self-help groups. Some of these perceptions that we have
already talked above are that self-help groups stem from a democratic logic, that is
increasing participation in local governance through a decentralization process. The other
reason we have mentioned is that discrimination against women is an obstacle to
economic growth since they are prevented from contributing to the economy through
productive work. Nevertheless, NGOs have other reasons behind targeting women. We
will go through them in the following passages.

The assumptions behind concentrating on women through self help groups can be
categorized into two sections. One contains substantial approaches and the second
contains instrumental approaches. In the substantial approaches one can find the problem
of feminization of poverty, as well as the feminist argumentation laying its foundation on
a human rights perspective: when dealing with the phenomenon of the feminization of
poverty, we consider the fact that women are observed to be among the poorest of the
poor, adding to that they suffer from a high degree of vulnerability. Therefore when
regarding their situation, their aid is a priority for non-governmental organizations as they
are the most underprivileged amongst the poor. For NGOs, this reason seems too
obvious, and helping women is taken for granted. For that matter, when I interviewed Mr.
Bino Thomas, the field coordinator in the Center of Social Action (the NGO I dealt with),
I asked him about the reason underlying the targeting of women. When answering, he
drew up a list of discriminations that women suffer in India ranging from the dowry
system34 to employment and education. Targeting women is an obvious issue that the
question never arises for these organizations and for social workers or students of social
work with whom I have taken courses during my stay in India.

34
The dowry system governs marriage in India, especially among Hindus. In fact the family of the
husband demands a dowry from the bride‟s family as a condition for marriage. A dowry can be an amount
of money, land or other valuable assets. The dowry value differs according to the social status and caste of
the bride and husband. It is a big issue as many women can‟t be married because they don‟t have the
amount, or they get killed by their husband who continues to demand more dowry even after marriage. The
dowry is prohibited in the Indian law but still govern marriages.

26
 As for the feminist view which has its source from a human fundamental rights‟
perspective. It considers that women should have access to their basic rights. From this
point of view, women‟s access to credit will be an opening and will pave the way for
them to gain more power (empowerment) in their environment35. Many NGOs like
SEWA (Self-Employed Women Association), which is one of the main promoters of
microfinance and main advancer of women‟s rights in India through economic means36,
put forward explicitly the use of microfinance through self-help groups in order to fight
for their independence, autonomy and women‟s rights. Again, when talking to Mr.
Thomas from CSA (Center for Social Action), I asked him about the logic behind
grouping these women into groups in order to acquire credit and have some savings. The
answer I got was that when women save and have access to more credit, they will be able
to increase their income through starting enterprises or any other economic activity
thanks to the increase access to credit in with affordable interest rate37. Hence, the
increase of income and the fact that they are organized will enhance their bargaining
power with respect to their surrounding environment (community and household) but
also with respect to local authorities, thus they will be able to advance their demands and
achieve a certain autonomy and independence.

The above perceptions were given on the side of the substantial approach, as for
the instrumental approach we also have two views shared by NGOs. The first we have

35
Mayoux, L. (2000). Micro-finance and the empowerment of women - A review of the key issues. Geneva:
ILO Social Finance Unit.

36
Self-Employed Women Association. (2009). Retrieved August 27, 2009, from SEWA:
http://www.sewa.org/About_Us.asp

37
Before self-help groups, women and men used to take loans from local money lenders who charge
colossal interest rate that could amount to 50% of the loan. When taking loans from self-help groups
women are subject to an interest rate of 1 or 2%. Self-help groups are seen as a way for women to escape
from the domination of informal money lenders. However, even with this scheme women continue to take
loans from money lenders who now prefer women because of their creditworthiness showed through the
self-help groups, and women continue to take out loans from these lenders (reference). Hence many critics
accuse the self-help groups of feminizing debts.

27
already exposed when we were dealing with the governmental actor: it deals with the
concern of economic growth, i.e. women discrimination hinders economic growth, and
thus women are targeted by the self-help group scheme because they also channel their
increase of income to the household. In a matter of fact, the self-help groups initiated by
the CSA consider women not as their final target group: when speaking with field
workers and coordinators, they told me that their final target group is children: they have
the belief that through the increase of women income, more resources will be channeled
to the children, hence resulting in better clothing, and education especially for the girls.

The second logic that inscribes to the instrumental approach to targeting women
through self-help groups stems from a financial rationale since this scheme is primarily
concerned with savings and credit. In a matter of fact, it is assumed that women are more
cooperative; they tend to honor and respect their commitments, hence they are better at
repaying their debts. In another word, women are “good” borrowers, financially
disciplined and take their repayments seriously (unlike men, according to the non-
governmental organizations. This is an important, if not a major factor behind targeting
women in this new microfinance scheme since the bulk of it is based on finance and
credit. Hence women are deemed to be more credit worthy. NGOs tend to associate this
factor with enabling empowerment to women: they argue that financial discipline is
essential to economic empowerment hence expanding individual choice. Moreover,
international donor agencies will give funds for NGOs who succeed to initiate financially
sustainable groups which requires that women don‟t squander their money around, and
require an accepting audience rather than resilient and resistant38.

Some critiques of this perspective advance the argument that NGOs target women
only for their financial discipline and have the assumption that “women are easier to
manage and mobilize and are less argumentative”39. These critiques asses that contrary to

38
Palier, J. (2005). Op. cit.
39
Deshmukh-Ranadive, J. (2004). Women’s Self-help Groups in Andhra Pradesh: Participatory.
Washington: World Bank.

28
their openly declared intentions and objectives of social change through forming the self-
help groups, NGOs and donor agencies are in fact exploiting the situation of these
women and the vulnerability they suffer from. Therefore instead giving these women
power and expanding their capabilities, these external actors are enhancing and enforcing
women‟s weak and disadvantaged position in society. Hence, while NGOs claim that
their aim is to give voice to these women, they are basing their action and assumptions on
the fact that these women don‟t “have voice”, and only because to this factor that self-
help groups can be formed because it would be easier to teach women financial
discipline. Therefore, NGOs gave up on men because they presented less discipline,
acceptance and manageability: men have an advantaged position relatively to women;
therefore it is not easy to tell them “what to do” and “how to do it”. Following this
critical perspective, NGOs are accused to have become financial intermediaries40, i.e.
mere tools to channel credit from banks to the self-help groups rather than motors and
promoters of social change41.

Other critics accuse that the concentration on women by NGOs through the
formation of self-help groups contribute to neglecting other underprivileged and
disadvantaged groups like Scheduled Castes, Scheduled tribes and Other Backward
Castes. Hence putting women in the front picture contributed to moving these groups
who were historically disadvantaged to the margin of government and NGOs programs
despite the fact that they are as needy as women and such projects are crucial for their
well being and social advancement. Moreover, self-help groups for women tend to pin
point women against men: S. Rabindranathan argues that “self-help groups today focus
only on issues related to women empowerment with the hypothesis that men would

40
Marius-Gnanou, K. (2003, September 22-23). Pratiques économiques solidaires en Inde rurale :
l‟exemple des Self Help Groups (groupes solidaires féminins de microfinance) et impacts en termes
d‟empowerment. Presented at Congrès du réseau Asie .

41
As we shall see later, especially with the CSA, many self-help groups don‟t conduct collective social
actions in the sense that they don‟t do community work. And their activity is only concentrated on savings
and giving out loans. Hence in the meetings women only discuss financial matters. In this sense, NGOs
who foster these groups are limited to being financial intermediaries and not actors for social change.

29
always oppose or discourage the empowerment of women”. Through this logic of
targeting only women, NGOs contribute to forming a group based solidarity between
these women, this collective approach may thus result in the accentuation of gender and
caste inequalities42. Moreover, the exclusion of men may have the risk of increasing or
creating tensions inside the household or the neighborhood and village.

These perceptions underpinning targeting women by NGOs through the self help
groups will help us understand more how these assumptions (regardless of whether they
are true or not) held affect women in self-help groups and the way of action they
undertake. These assumptions have the ability to shape women, and to transform them in
order to fit them. NGOs while targeting women follow the rhetoric of “helping women to
help themselves”, hence implying that these women are unable to help themselves by
themselves. In the next section we will look into the tools used by these NGOs to “help
women help themselves”.

4.2.2.What is behind the concept of empowerment?

When examining self-help groups, looking into the concept of empowerment is

crucial and inevitable since it became the main concept behind the work of non-
governmental organizations. During the courses I took in Christ University in Bangalore
while I was in the master of Social Work43, it is obvious and clear that the term
empowerment is the key and imposing term in community development work. It is the

42
Rabindranathan, S. (2005). Historical analysis of empowerment and its present understanding in the
context of microfinance. In I. Guérin, & J. Palier, Microfinance Challenges: Empowerment or
Disempowerment of the Poor? (pp. 89-97). Pondichérry: Institut Français de Pondichérry.

43
I was taking part in an exchange program between my university in Paris, University of Pars-Dauphine
and Christ University in Bangalore. In Bangalore I was in the Master of Social Work in which I took
community development courses.

30
driving concept behind forming self-help groups, donor agencies‟ grants, and government
promotion of microfinance. Again, when interviewing Mr. Bino James from CSA I asked
him about the objective of self-help groups, he didn‟t have to think much before
answering: the objective is to empower women through credit. In the following pages we
will examine the concept of empowerment and what it implies; moreover we will try to
find out the link between self-help groups and empowerment.

The concept of empowerment is generally treated through the frame of thoughts

of the Indian economist and Nobel Prize winner, Amartya Sen. In his book,
“Development as freedom”44, Sen views poverty as the lack of capabilities and choices,
thus it is not a matter of material assets or absence of rights. Thus Sen advocates
empowerment as the expansion of the capabilities of the disadvantaged individuals, hence
permitting them to make choices and exercise their rights. This implies a gain of power,
taking power, the view that Sen holds can be qualified as neutral since an empowered
individual gains more power through building capabilities, and this gain is not on the
detriment of anybody else. Sen‟s work has become very influential in the development
discourse as it was even adopted by the World Bank.

In fact, in elaborating the new development paradigm, the international

organizations have taken Sen‟s approach in order to define empowerment in the frame of
the “comprehensive development” (World Bank, 2009)promoted in order to have a
different discourse that redefines poverty and stresses on the human fundamental rights.
Therefore the World Bank defines empowerment as: “the process of increasing the
capacity of individuals or groups to make choices and to transform those choices into
desired actions and outcomes. Central to this process are actions which both build
individual and collective assets, and improve the efficiency and fairness of the

44
Sen, A. (1999). Development as freedom. Oxford University Press.

31
organizational and institutional context which govern the use of these assets”45. This
definition echoes Sen‟s perspective, when it comes to concretizing the concept of
empowerment; these organizations put the emphasis on building and having a stable
environment for individuals to exercise their rights and choices. And more often,
empowerment is understood as the emancipation of women from the domination of
traditional institutions that are the reason for their disadvantaged position within
society46.

A more radical view is held by the Indian sociologist Andre Beteille who has
become an authority when speaking on the concept of empowerment. Beteille argues that
“empowerment is about social transformation; it is about radical social transformation;
and it is about the people – ordinary, common people, rather than politicians, experts and
other socially or culturally advantaged persons”47. Thus, “empowerment is a means to an
end and end by itself”. Therefore empowerment is about enforcing unenforced rights and
providing economic security. Beteille inserts empowerment in the Indian contexts, as it is
a path to overcome the constraints put by the traditional hierarchal institutions and to
achieve a certain egalitarian society based on civility rather than caste48. Moreover
empowerment holds a dimension of power; Beteille argues that is a renegotiation and
redistribution of power and also a change in social values. Implicit behind this definition
is that empowerment is taking power from the privileged in order to give to the
disempowered, i.e. the underprivileged which implies a conflictual process49.

45
World Bank. (2009). Empowerment - Overview. Retrieved August 20, 2009, from The World Bank:
http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTPOVERTY/EXTEMPOWERMENT/0,,con
tentMDK:20272299~pagePK:210058~piPK:210062~theSitePK:486411,00.html

46
Palier, J. (2005). Op. cit.
47
Beteille, A. (1999). Op. cit.
48
This vision refers to what we mentioned in the part where we talked about the government‟s motivations
in forming self help groups, and one of them is to overcome the contradiction between a hierarchical caste
society and a constitution devoted to equality. Thus self-help groups are the platforms for forming
citizenship that will transcend caste belonging.
49
Beteille, A (1999). Op. cit.

32
 Sen and Beteille present two currents dealing with this concept. In a matter of
fact, empowerment is about power and changing power relations which have different
dimensions; some of them can be considered neutral (non-conflictual) and others
conflictual. Let us examine them: the first dimension would be “power over”, this implies
that power exists in a limited quantity, and involves a relationship of domination and
subordination, therefore, more power one party has, less power the others party has which
means that empowerment is a conflictual process. The second dimension is the “power
to” which is the kind of power that enables having decision-making authority, power to
overcome obstacles and solve problems. This refers to the individual aspect of power; it
relates to expanding intellectual and economic capacities through accessing, controlling
and using the means of production50, this vision is in line with Sen‟s perspective. The
third dimension of power is the “power with” which refers to the political and social
power. It is the collective dimension of power, it involves organization, collective
solidarity, lobbying for rights and bargaining with the authorities. It assumes that people
having a common vision and interest will regroup in order to advance their demands51.
The fourth and last dimension of power is the “power within” which refers to self-
52
confidence, self-awareness and assertiveness and to self-image and psychological
force. This aspect is related to individual empowerment, the one which is felt by the
person alone which results in self-respect and the respect of others.

The question remains whether empowerment means taking power from someone
(a zero-sum game) or just increasing one‟s power (a win-win situation). According to the
53
dimensions we have exposed above, the interpretations may vary. Parson Talcott

50
This aspect has to do directly with microfinance, and the lending and saving schemes in the self-help
groups.
51
This aspect is very important to understand the logic behind moving microfinance from individual
lending to a collective one through self-help groups and to scale up the action towards social and political
purposes.
52
Rabindranathan, S. (2005). Op. cit.
53
Parsons, T. (1963). On the Concept of Political Power. Proceedings of the American Philosophical
Society.

33
argues that power is not necessarily what some have over others, but it could be a
resource to be utilized by a community as whole in order to attain its aspirations. Here
power is compared to the wealth of a nation, thus a nation‟s wealth can be increased
without decreasing the wealth of another. The same goes for power: one can gain power
without taking it from others. This seems the logic of NGOs when initiating self-help
groups. In fact, NGOs adhere to the paradigm set by international donor agencies like the
World Bank since they depend from them in order to acquire funds; it is an upward
accountability that rules the relationship between the two parties54.

International Organizations concentrate on the dimension “power with” in a sense

that they accord importance to creating organizations (such as the self-help groups) in a
stable environment or participating in the existing organizations (like the Panchayati Raj
Institutions) instead of questioning them55. Therefore the emphasis is placed on civil
society, increasing power in a neutral and non-conflictual way and once again what
“good governance” (another key word used by the World Bank to grant aids and
implement development projects in developing countries) is recommended when it comes
to organizations. Another side of this interpretation of empowerment is the expansion of
individual capacities in order to effectively act in an environment with limited resources
hence empowerment comes in a context to able individuals, precisely women to compete
over scarce resources. Therefore for the World Bank, self-help groups should be
empowered, gain power but from nobody as a stable environment should be available for
everyone to exercise their rights.

This dimension of empowerment doesn‟t seek to challenge the existing social

structure through self-help groups but only wishes to create entrepreneurs able to exercise
their activity in a hospitable environment. In fact many have critiqued this notion of
empowerment that the NGOs have adhered to. These organizations are dependent on

54
Kilby, P. (2006). Accountability for Empowerment: Dilemmas Facing Non-Governmental Organizations.
World Development , 34 (6), 951–963.

55
Palier, J. (2005). Op. cit.

34
donor agencies, and fund are not allotted to every NGO working with women self-help
groups, these organizations are subject to criteria that determine their selections by
international donors. Therefore NGOs must conform to the standards set by donors who
rely on professionalism, good governance, and above all financial sustainability of the
self-help groups and not their commitment to radical activism. Therefore NGOs would
prefer groups with a high financial profile rather than groups with high social activism
profile56.

This notion of empowerment coupled with the praise of self-help groups has
moved to the margin many historical movements who struggled for rights for
underprivileged in India57, ranging from Dalit58 movements to women movements.
Therefore NGOs and self-help groups have de-politicized the struggle of women and
disadvantaged categories of society in India 59. Thus, through the infiltration of “the neo-
liberal agenda of restructuring state, civil society, whittled down to a depoliticized sphere
of NGOs, is seen as a cheaper and more efficient alternative to the state. This redefined
domain of civil society excludes political struggles and challenges to state power. Instead
it is seen as a sphere of market friendly institutions and service delivery agents outside
and independent of the state”60.

Moreover, self-help groups are praised to be a good model of a participatory

bottom-up approach, nevertheless this is not very obvious. One reason is stated above
which refers to the dependence of NGOs on donor agencies who have their own agenda
regardless of the needs of the group. This increasing dependency on donor agencies
questions the premises that the NGOs claim to have while working with self-help groups,

56
Hofmann, E., & Marius-Gnanou, K. (2004). Op. cit.
57
Rabindranathan, S. (2005). Op. cit.
58
Dalits are the formerly untouchable castes in the Indian caste system. Since untouchably was abolished
by the Indian constitutions, they are now called Dalits.
59
As we have seen before, self-help groups became an extension of government to provide social services.
This hinders their role as actors involved in social change. NGOs don‟t question the government or local
authorities since they provide the institutional environment for flourishing self-help groups.
60
Randeria, S. (1999). Op. cit.

35
which is the bottom-up approach, which implies that projects are formulated according to
the needs of the women through a process of participation that enables them to be
involved in every step of the project. However, due to their need to funds, NGOs holds
themselves accountable only to donor agencies, and not to their constituents (downward
accountability) which questions their democratic claims61. Moreover, NGOs have their
own predetermined programs and services to self-help groups without negotiating them
or assessing the needs of the women62. Thus through this angle NGOs are perceived as
mere vehicles of dominant interests embodied in international organizations like the
World Bank who seek to advance the their logic amongst those sections of society who
are at the margin of the market63. Therefore microfinance can insert the poor into the
financial economic system from which they have been excluded for a long time.

One issue remains: why create groups in order to empower? One of the power
dimensions is the “power with”: organizations which are seen as a crucial component of
empowerment. Organization is perceived as the most powerful tool to give power to the
disadvantaged or oppressed who lack influence; it is at the heart of democracy and
participation. Organization gives leverage to people with little wealth, social prestige or
political influence64. However, the question is: why didn‟t these women organize
themselves? When I asked Mr James he immediately replied that poor women lack
education, awareness and knowledge, therefore they are not aware of the virtues of
organization which means that they will not organize themselves. In a matter of fact,
chronic poverty is usually associated with the lack of education, capital, social status and

61
Kilby, P. (2006). Op. cit.
62
When I went to visit CSA initiated self-help groups in the slums of Bangalore. The field workers were
explaining to the women in these groups a waste management program to be implemented in the slums.
Therefore they were communicating the information for the women in order to implement the project.
These projects are often suggested by NGOs and are marketed to women without their explicit demand.
This puts in doubt the bottom-up claim by NGOs
63
Jakimow, T., & Kilby, P. (2006). Empowering Women: A Critique of the Blueprint for Self-help Groups
in India. Indian Journal of Gender Studies , 13 (3), 375-400.

64
Otis, M. (2005). Re-Imagining Civil Society in India. Rhode Island: Brown University Providence.

36
many important assets. Therefore, when it comes to group formation they are structurally
weak because they don‟t have enough assets and are not able to productive contribution
to maintain their organization65, the result is that even when they try to organize
themselves the attempt will not be sustainable66. Here comes the role of NGOs in
inserting these women in a logic of organization by giving them enough assets through
the credit scheme for them to be empowered. As the term suggests, an individual cannot
empower herself rather she is empowered. Therefore we observe that empowerment has
to be externally induced, the NGOs empowers the women67. One can argue that the
empowerers (NGOs) hold power over the empowered (women) that may alter her
attitudes and perceptions.

After having examined the concept of empowerment and what are the
implications it holds on the self-help group enterprise we still have to study the effect that
the NGOs have on the functioning of self-help groups. In fact, the repercussions of the
use of empowerment in the development projects differ according the context and the
actors involved in promoting it. As we have seen in the previous pages, empowerment
may uphold a project of radical change which put forward by radical activists in order to
alter the power structure in society in the favor of the disadvantaged. However when
international donors as the World Bank enter into the picture, and NGOs give more
important to upward accountability (towards the donors) rather than downwards (towards
self-help groups), the concept of empowerment will be stripped of its radical change. As
a result the ambition becomes having a stable environment for exercising rights and

65
This also refers to Olson‟s theory about collective action which we will discuss in the second chapter.
Olson argues that if the organization doesn‟t produce enough collective goods, and more importantly none
collective goods for its members in order to compensate for the cost of the collective action, the
organization cannot sustain itself.
66
Thorp, R., Stewart, F., & Heyer, A. (2005). When and How Far is Group Formation a Route Out of
Chronic Poverty. World Development , 33 (6), 907-920.

67
Batliwala, S. (1994). Meaning of Empowerment: New Concepts Form Action. In G. Sen, A. Germaine,
& L. Chen, Populations Policies Reconsidered: Health Empowerment and Rights. Cambridge: Harvard
University Press.

37
starting micro-enterprise projects, empowerment is used as a neutral concept and as a
vehicle to the international institutions‟ (as the World Bank) style of thoughts seeking to
depoliticize the public sphere, and to minimize the role of government and attenuate
social change. Despite the above, self-help groups have succeeded in some way in
helping the women renegotiate their power and their position within their environment
68
and households and paved the ground for creating and expanding spaces for women in
order to realize and conduct their collective endeavor as we will see later on in our
research.

In the following chapter we will see more concretely how this style of thoughts
affects women and self-help groups. And we will examine the women groups themselves
in order to understand their functioning as a small group according to Mancur Olson‟s
typology.

68
Deshmukh-Ranadive, J. (2005). Can Microfinance Empower Women. In I. Guérin, & J. Palier,
Microfinance Challenges: Empowerment or Disempowerment of the poor? (pp. 113-121). Pondichérry:
Institut Français de Pondichérry.

38
 5. Chapter 2: Self-Help Groups and the Logic of Collective
Action

In the previous chapter we have tried to examine two external actors who are the
holders of the self-help group project. In a matter of fact, in order to understand the
functioning of the groups we had to study NGOs and the government promoting them.
Our research question or enquiry lies in grasping the way and logic through which these
groups undertake their actions and sustain their organization as we argue that they obey
to Olson‟s theory about collective action and groups. Therefore, investigating the
premises, assumptions, objectives and representation that the external actors have of the
self-help groups is essential. That is why in the first part of this chapter we will argue that
NGOs and government through the representations they have of these groups, and
through the guidance they provide to them are circulating a specific style of thoughts to
these women reinforcing the mechanism that Olson spoke about in demonstrating his
theory. Then in the second part we concretely expose how Olson‟s theory of groups is
being applied through the self-help groups which is combined with the Gandhian
tradition of solidarity and duty in conduction collective action

5.1. Why does Olson’s theory apply to self-help groups?

Through women self-help groups, NGOs and government are shaping the
women‟s style of thoughts and creating new realities which made possible a certain
collective action through these groups and helped maintaining organizations in these
disadvantaged areas. This style of thoughts circulated has paved the way for
methodological individualism reasoning for these women where the cost-analysis
calculations apply. These factors support our premise that the self-help groups are a direct
application of Mancur Olson‟s theory about collective action and groups, and the fact
these they are small groups will not have any effect on our reasoning or on the validity of

39
the theory even though Olson himself asserted that the mechanisms he explained in his
book only apply to large, latent groups and not to small groups due to their size, thus they
follow different mechanism which are not treated in his book.

5.1.1. How through self-help groups NGOs and government

are shaping the women’s style of thoughts.

While dealing with external actors we have mentioned that the international
institutions “style of thoughts” is being circulated to the women in self-help groups, and
we have briefly explained the concept. In the next pages we will develop this point as
well as elaborate more on the notion of “style of thoughts”.

In her book “how institutions think” 69, the anthropologist Marry Douglas seeks to
understand how institutions function and in which way they condition the individual‟s
life and cognition. She adopts a program that she calls the “Durkheim-Fleck program” as
her theoretical framework for her argumentation. In elaborating this program, Douglas
couples the French sociologist Durkheim‟s epistemological sociology and the German
philosopher Fleck‟s philosophy. Durkheim examines the relationship between the
individual and the society, and he conceptualized a possible conflict between these two
parties as the struggle of antagonistic forces inside the individual. As a matter of fact,
Durkheim argues that the individual thinking has a social origin; the logic, the
representation, and the classifications that the individual has is given to him by the
society. Through this frame of thoughts the French sociologist sought to explain
solidarity in society: in a primitive society solidarity is based on the sacred, and in an
industrial society solidarity is based on the market70. When it comes to Fleck, he doesn‟t
make such distinctions, but he goes further than Durkheim when analyzing the social

69
All this paragraph on the chapter 1 “Institutions don‟t have a brain” of Douglas‟ book
70
We will avoid making such distinctions while dealing with self-help groups as it is not obvious to make
this kind of classifications, society‟s structure is more complex and is not clear-cut.

40
group. He introduces several concepts as the “world of thoughts” and its “style of
thoughts” which governs the perceptions and forms and produces knowledge. Fleck
views the style of thoughts as the condition of existence of cognition and provides the
frame and defines the limit of every judgment held on the objective reality. Its main
characteristic is that it is invisible to the members of the world of thoughts. As Fleck puts
it: “the individual belonging to this world is never conscience of the dominant style of
thoughts, which exercises always an absolute hold over his thoughts from which it is
impossible to discard”71. The style of thoughts is sovereign over the thinking being as the
collective representations are in the primitive cultures.

Mary Douglas combines the works of Fleck and Durkheim in her reasoning, as
she says: “Sometimes it will be fleck and other times it will be Durkheim who will
provide the better answers. Fighting as allies, back to back, each can compensate the
weakness of the other by his own force”72. Through this Fleck-Durkheim program,
Douglas will seek in her book to find out to what extent the thoughts of individuals
depend from the institutions. Following this line of thoughts, we will take the Durkheim-
Fleck program, and more precisely the concepts advanced by Fleck in order to show that
NGOs and international donor organizations like the World Bank, and the government
adhere to a certain world of thoughts and through the self-help groups they are circulating
their style of thoughts. Therefore, these external actors and women self-help groups are to
a certain extent governed by certain social and economic institutions which govern and
shape their thoughts. In the following pages we will trace the effect that self-help groups
have on women.

As we have already said, self-help groups in the Indian context73 are primarily a
microfinance scheme, i.e. they seek to insert the poor and especially women in the

71
Fleck, L. (1935). The Genesis and Development of a Scientific Fact. University of Chicago Press. Cited
in Douglas, M. (1986). How Institutions Think. New York: Syracuse University Press.

72
Douglas, M. (1986). Op. cit. p.45
73
We say Indian context because the concept of self-help is originally western, and it didn‟t start as a
credit program but as a group of individuals sharing the same grievances gather around and talk about their
personal experience in order to help themselves and provide help to each other.

41
financial system from which they have been excluded. Thus, in the first place it is a
project to provide women access to credit away from the local money lenders in order to
enhance their well being. In order to provide these groups with an important amount of
credit, NABARD (National Bank for Agriculture and Rural Development) launched the
self-help group – bank linkages, and as its name applies, it aims at linking the groups to
commercial banks in order to acquire a considerable amount of money in addition to the
weekly savings that these women conduct74. And in order to give credit the banks
demand a guarantee from NGOs that these women will repay the debt as there is no
collateral involved while taking the loan. Therefore, NGOs conduct trainings for these
women on how to manage the money, how to have a check book in order to record the
savings, and provide them with guidelines for their internal functioning (we will deal
with that more in the second part of this chapter); in short women have to demonstrate
financial discipline.

As a matter of fact, while searching for literature about the sustainability of self-
help groups, the bulk, if not the totality of what was found deals with sustainability as a
matter of finance and not organization. This is because most NGOs working with self-
help groups concentrate on financial sustainability rather real empowerment and
collective action which is due to the dependence on donor agencies that make sure that
the women access credit and make “good” use of it. Thus, financially disciplining the
women is essential by circulating the international institutions‟ style of thoughts which
advocates for a productive spending of the credit and high repayment rate which is
assumed to lead to empowerment as women learn how to balance a check book, keep
track of their expenditures and mostly become entrepreneurs. Purushothaman 75 notes that
increased self-efficacy enabled a „curiosity in entrepreneurship‟, and confidence to
pursue economic activities While interviewing the self-help groups initiated by the CSA
in a Bangalore slum, I came to know that these groups are limited to savings and loans

74
Reddy, C., & Manak, S. (2005, October). Self-Help Groups: A Keystone of Microfinance in India.
Hyderabad: APMAS.

75
Purushothaman, S. (1998). The Empowerment of Women in India: Grassroots Women’s Networks and
the State. New Delhi: Sage Publications.

42
and don‟t conduct any activities outside the frame of credit, and still the field
coordinators of CSA were proud that some groups have sustained themselves for 9 years.
The concentration on credit and entrepreneurship alters the mindset of these women and
circulates a certain style of thoughts based on an economic rationality of a cost benefit
calculation: while interviewing a woman in a sangha76 in the same slum, she told me that
they don‟t allow rich women to enter because rich people only save and don‟t take loans.
This statement is extremely expressive of the phenomenon we are trying to explain.

Moreover, the term self-help appears to be ambiguous as it has a double meaning:

self-help as an individualistic endeavor which means that the individual will be
independent from others and she will be responsible for getting herself out of poverty, in
short self-helping oneself. Nevertheless, self-help can be a collective endeavor where
women gather around a solidarity feeling through which they can help themselves
collectively to overcome poverty and the constraints hindering their aspirations.
Promoters of self-help groups claim to pursue the collective sense of self-help, however,
in the same time we see that many groups are only based on credit and NGOs and
government attract members through offering more loans than in other self-help groups.
In fact, many women I interviewed told me that they joined the CSA self-help groups
because they offer more credit than other NGO self-help groups as well as sponsoring
their children education. Some women left their original self-help groups in order to join
the CSA ones for the very same reason. Thus, we can say that there is the promotion of
the individual self-help, individual initiative which is in line with neo-liberalism. S.
Rabindranathan argues that self-help groups “though they appear to be collective, often
lack this spirit, as their members are more concerned about personal gain, rather than a
common purpose”77. These factors contributed to the success of the self-help groups and
fulfilled the assumption we already mentioned that women, unlike men, have financial
discipline. This does not mean that the assumption was indeed true but it might have been
self-fulfilled, one thing is for sure: NGOs and government are training these women in

76
The local appellation of self-help groups
77
Rabindranathan, S. (2005). Op. cit. p.95

43
order to conform to the logic of the international institutions‟ paradigm without which
microfinance would not be successful.
The initiation of self-help groups has had the effect of feminization of social
78
action in order to orient it towards specific feminine issues and claims such as domestic
violence, fighting male alcoholism and other issues of women concern. Moreover, self-
help groups have helped creating new spaces for women as they were confined to their
households, they didn‟t have ownership over the public space which was not their domain
before the introduction of self-help groups. When interviewing the women in a Bangalore
slum or in the rural area of Hoskote, I asked the women whether they knew each other or
whether they interacted or helped each other before the self-help groups. Most of the
women had a negative answer, and when it was positive there was little interaction.
Moreover women in slums often cumulate work, they clean several houses, thus they
don‟t have much time to socialize and they attend the self-help groups during their thirty
minutes break. Therefore, self-help groups did not only create new affinities and social
networks between these women but also expanded the physical space for these women as
attending the meetings is necessary otherwise there will be sanctions. The space was
expanded also to local governance bodies like the Gram Vikas where women started to
attend the meetings and even run for elections which were not the social norm before
self-help groups79.

NGOs and government affect women in the ways we spoke about through
circulating a certain style of thoughts making them apt to the methodological
individualism reasoning. They have trained them to be financially disciplined in order to
have a good performance to attract credit from banks This by circulating a certain style of
thoughts “where rights and responsibilities are equally valued and internalized, and

78
Guérin, I. & Palier, J. (2005). Op. cit.
79
Viswanath, V. (1993). NGOs and Women’s Development in Rural South India: A Comparative Analysis.
New Delhi: Vistaar Publications.

44
where sanctions are imposed and accepted”80 as MYRADA81 inscribes in its guidelines.
The attitude of individual self-help and independence is promoted which goes along with
entrepreneurship and private initiative. These facts have made possible the success of
self-help groups as savings and credit groups which have created new spaces allowed for
these women. This allowed them to gather, meet, and interact and to constitute a certain
group feeling through which collective action is rendered possible.

The NGOs and government have contributed to the sustainability of these groups
through the self-help groups-bank linkages by means of providing them enough credit.
This credit, according to Olson‟s theory, allowed for the benefits of organization will
exceed its cost82 through a series of mechanism which we will talk about later. However,
according to Olson‟s typology, these groups remain small therefore the mechanisms that
apply to them might differ from the ones that apply to important and latent groups. In the
following pages we will try to show with the aid of Douglas‟ work that the scale of the
group doesn‟t really matter, hence the mechanism of large groups apply to small ones
too.

5.1.2.Does group size matter?

The CSA, as Mr. James explained to me, seeks to organize these women into self-
help groups based on the belief that women have a common interest which is saving

80
MYRADA. (2002). Impact of Self Help Groups (Group Processes) on the Social/Empowerment Status of
Women Members in Southern India. Paper presented at the seminar on SHG–Bank Linkage Programme.
New Delhi.

81
MYRADA is an NGO based in Karnataka state in southern India. This NGO was the pioneer in starting
women self-help groups in India and it is the model that many NGO follow for forming self-help groups.
82
Refer to the section about empowerment where we explained why is it difficult for the poor to organize
themselves without external assistance as they don‟t have enough capital and asset for the benefit of
organization to exceed its cost.

45
money in a common pool in order to acquire credit. However women need these external
actors because they are unconscious of their common interest. We have stated this
assumption many times in our paper, but does the sole existence of a common interest
sufficient for organization and conducting collective actions? This is the question through
which Olson is trying to answer through his book “The Logic of Collective Action”83.
His answer is clear: if we assume that individuals are rational and they “seek to maximize
their personal welfare, they will not84 act to advance their common or group objectives
unless there is coercion to force them to do so, or unless some separate incentive, distinct
from the achievement of the common or group interest, is offered to the member of the
group individually in the condition that they help bear the costs or burdens involved in
the achievement of the group objectives.” 85However Olson explicitly mentioned that this
holds true for large or latent economic groups. He argues that small groups have a more
complicated situation where there may be voluntary action in order to advance the
group‟s common interest without any need of coercion. Hence Olson analyses small
groups in a brief matter compared to large groups to which he devotes most of his book.
Through the aid of Douglas‟s critique of Olson we will try to show that the same
mechanisms that apply to large groups will apply to small groups.

Olson tried to avoid including small groups in the mechanisms of coercion and
selective incentives to which large groups succumb. This may derive from a certain
86
perspective of a small group as comparing it to a romanticized community where
collective endeavor can be pursued without any difficulties. Despite the fact that Olson
insists on the individual as being self-interested and rational, when speaking about small
groups he is more or less hesitant regarding this assumption as he states that individuals
might provide a collective good because of kinship, friendship or other social relationship
that might exercise a sort of social and psychological pressure on the individual without

83
Olson, M.. (1965). Op. cit.
84
The emphasis is by Olson himself.
85
Ibid. p.2
86
In a sense that community has durable bonds, based on personal relationships, a strong sense of
solidarity, and working unselfishly for the common good. It is not to say that Olson adheres to this vision
that might seem naïve, but it may underline some of his assumptions about small groups.

46
needing any sort of coercion or selective incentives. Moreover because these groups are
small therefore they have interpersonal relationships, they know each other more,
therefore they can engage in organization and collective action without any of the
mechanisms we talked about above. That is why Olson calls these groups as privileged
relatively to large groups who cannot function without these mechanisms.

Douglas critiques this avoidance of Olson to deal with small groups and attempts
to extend his theory to these groups, thus she attempts to “venture into the forbidden city
[of small groups and communities]”87. She takes an anthropological approach through
understanding how communities are formed and maintained, she assumes that they are a
small group and not latent according to Olson‟s typology. She argues that “from an
anthropological perspective, the factors relating to cooperation have little to do with the
group scale”88.

She refutes the claim that the smallness of size enhances mutual trust which
constitutes the base for a community, thus organizations that have not their origins in the
individual profit are founded on mutual trust such as communities. This factor is at the
basis of praise of primitive pre-colonial communities who are seen as peaceful and easy
89
to subjugate as it was assumed that they didn‟t have the sense of profit, or utility
maximization at the individual level, therefore everything was motivated by the fact that
they are serving the community. That was how these communities were portrayed as
different from the colonizers who knew profit maximizing and were more rationale and
applying a cost-benefit calculation in the work they conducted. Douglas shows that even
these micro-communities were not different from the people who colonized them. “These
small societies, she says, were neither stable nor auto regulated, but in perpetual
reconstruction under the effect of negotiations and rational bargaining.” 90She concludes
that the individual cost-benefit analysis perfectly applies to the micro-exchanges that
occur for the primitives as well for the modern man.

87
Douglas M. (1986). Op. cit. p.55
88
Ibid. p.60
89
Ibid.
90
Ibid. p.61

47
 Through her analysis, Douglas has succeeded to reject the “touching illusion, the
idea of a utopian anarchist community”91. She demonstrated that the smallness of the size
doesn‟t justify Olson‟s precaution and avoidance to deal with them as easily persuaded to
conduct collective action because of their size. Therefore, through her anthropological
analysis Douglas contributed to Olson‟ theory about groups and collective action as she
showed that the same mechanisms that apply to large latent groups apply to small groups
also that are not immune to the individualistic cost-analysis benefit. As we see, the
analysis of larger and latent group logic can thus be expanded to include small groups
that were left out by Olson. From here we can take our analysis to self-help groups that
can be considered as groups of small size according to Olson‟s typology, therefore we
can say that the mechanisms we spoke about for larger groups also apply for them.

Despite this valuable contribution by Douglas to Olson‟s theory, we still believe

that Olson‟s distinction between different group sizes is relevant in the context of
analyzing the logic and functioning of the women self-help groups. In a matter of fact,
Olson makes another distinction amongst small groups, as he named two types within this
category: privileged and intermediate. The first type is a group where each or someone of
the members “has an incentive to see that the collective good is provided, even if he has
to bear the full burden of providing it himself”92. Therefore obtaining the collective good
doesn‟t require any organization or coordination whatsoever. An intermediate group is a
group where no member has sufficient benefit to give him incentive in order for him to
provide the collective good by himself. However this group will not have “so many
members that no one member will notice whether any other member is or is not helping
to provide a collective good”93. When having an intermediary type of groups, the
collective good is only obtained through coordination and organization.

This distinction is very useful for our purpose as it opens a possibility for the
some small groups, precisely intermediate ones, to be dealt with in a similar manner than
the large groups. However Olson restates later on his original assumption which is that

91
Ibid. p.60
92
Olson, M. (1965). Op. cit. p46
93
Ibid. p.50

48
small groups, unlike large ones, have an incentive to see that it does not fail, for this
reason any means of coercion or selective incentives are necessary. As Olson affirmed,
small groups might have other mechanism that can influence the initiation of organization
and collective action which might range from social pressure, interpersonal character of
the group. Moreover there is more interest in providing the collective good because
unlike large groups, the effort of members of small groups has more perceivable impact
and they can reap more benefits out of the provision of the collective good.

If the above were true, then self-helps groups (considered as a small group of 15
to 20 women) would function from the moment that women become aware that they all
have an incentive for the group to be sustained. But it is not necessary the case since even
the oldest self-help groups still function on the bases of coercions and selective incentives
as we will see in the next section. In this context, Douglas‟ contribution is of important
value when analyzing the functioning of women self-help groups. Therefore we extend
Olson‟s reasoning of self-help groups beyond the realm of the inherent advantages of
small groups as being composed of individuals who interact with each other.

This said, we find it essential to mention that we refrain from taking Douglas‟
position as asserting that group size doesn‟t matter. We argue that group size does matter
to a certain extent as we will see with the case of self-help groups. These groups combine
the coercion and selective incentive mechanisms used by large groups and the initial
advantages of small groups in order to render their collective action possible. The self-
help groups might be classified as small intermediate groups according to Olson‟s
typology hence mixing mechanisms from both types of groups. In the next sections we
will show how these mechanisms operate in a more concrete manner in the functioning of
self-help groups. Therefore, exposing the effects (we spoke about in the previous section)
that NGOs and government have on women in order to render the mechanisms of
coercion, selective incentives and social pressure work effectively in the self-help groups.

49
 5.2. Collective action in self-help groups: an “Olsonian”
methodological individualism ingrained in the
Gandhian tradition.

In this last chapter of our research, for the first section we will try to demonstrate
concretely how self-help groups obey in a very direct way to Olson‟s methodological
individualism embodied in the theory of collective action and groups. As we argued
earlier, women self-help groups present a combination of the mechanisms of latent,
important groups and the properties of small groups. However, we will see in the second
section that self-help groups are not just a mere concretization of Olson‟s theory, but
other factors enter into consideration which will have an outcome as a collective action.
These factors transcend the methodological individualism assumptions underlying
Olson‟s findings, but rather find their roots in the Ghandian philosophy and traditions of
duty and solidarity in the village context.

5.2.1. Self-help groups: a combination of mechanisms

governing latent groups and the properties of small
groups

First, it is important to mention that there no ambiguity in applying Olson‟s theory

of collective action since these groups are at first economic groups that seek to make
these women better off through access to credit. Moreover, Olson affirmed in his book
that large groups don‟t function without selective incentives and coercion because an
individual‟s effort is not noticeable to the group. Therefore a rational individual will not
contribute to the production of the collective good since he would anyway benefit from
this group, thus an individual needs to be provided by the group with non-collective
goods, and ought to be coerced in order to contribute, and otherwise collective action will

50
not occur. This, according to Olson, might not be applicable to small groups due to the
reasons we spoke about in the previous section.

However, women self-help groups are considered to be small groups, the

individual effort of each member highly influences the group: the group is formed of 15
to 20 women, it accumulates capital through the small weekly amount that each woman
has to put in the group common pool, this presents a small amount of capital that women
can borrow from but not sufficient in order to increase their income and acquire means of
production. Therefore, the group goes to seek loans from commercial banks that could
lend it an important amount of money in order to able the women to achieve their
economic aspirations. In order to access such credit from banks, the group has to
demonstrate a certain financial discipline which means that the weekly savings are
regular, the group succeeds in preventing the default of loans, and they should be able to
have viable projects. Once the credit is given by the bank, the group decides in which
way it will be allotted to the different members according to their needs. From the above
we can clearly see how the effort of each member is crucial to the group and can be easily
noticeable. Thus take the example of a woman who doesn‟t contribute to the weekly
savings, hence affecting the capital of the group, or she defaults from repaying her loan
which might lead to the default of the whole group from repaying the loan back to the
bank. These actions affect the general performance of the group and its financial
credibility resulting in the refusal of the bank to give out loans again, thus the group will
no more be providing the collective good because of which it was created which will
finally lead to the loss of its purpose.

The above scenario is not uncommon in women self-help groups as many women
default or refuse to pay the weekly saving amount, therefore the group will have to
compensate and pay the credit of the defaulter to the bank94. The smallness of the size
alone of self-help groups doesn‟t really prevent these types of behaviors nor is it
sufficient to do so. That is why the external actors (NGOs and government), through

94
Many women I interviewed reported to me that they had to face this problem in their groups at a certain
time.

51
introducing bylaws and internal regulations95, insure that the groups have financial
discipline through applying selective incentives and coercion in the self-help groups
which we will now examine. The main findings in this section will be based upon the
observations and interviews I made with the women in self-help groups in the city of
Bangalore.

Olson defines a selective incentive as the one “that operates, not indiscriminately,
like the collective good, upon the group as a whole, but rather selectively towards the
individuals in the group. The incentive must be “selective” so that those who do not join
the organization working for the group interest, […], can be treated differently from those
who do”96. These incentives according to Olson can be either positive (in the form of
advantages and benefits for those who work for the group) or negative (in the form of
coercion for those who refuse to cooperate). These incentives are at the heart of the
functioning of self-help groups as they are an essential part of the motives behind their
members‟ commitment.

Interviewing the women in CSA self-help groups, the main question I asked them:
what is your motivation for joining the group? Many of the women said that their
motivation was acquiring credit in order to send their children to school or help her
husband to improve his business97. Another reason underlying their participation was the
fact that the CSA offers a sponsorship program for the children of one of these women98,
that means that the CSA will take care of the school fees as well as books and other
schooling materials for the children of the chosen woman. These are considered as

95
The CSA as the other NGOs, propose bylaws to the women self-help groups. That is done after a series
of trainings and workshop for these women in order to familiarize them with organization. The bylaws will
have regulations about how the meetings should be conducted, what is allowed and what is not, and how to
punish defaulters and those who don‟t abide by the group. It is a mechanism through which women
internalize the notions of financial discipline and organization.
96
Olson, M (1965). Op. cit. p.51
97
Most of the women in the slums didn‟t have their own business as they mostly worked in cleaning
houses; therefore they spent the day going around different houses in the area.
98
The sponsorship is on a rotating manner: the group decides at each time to the children of which women
goes the sponsorship.

52
positive selective incentives because clearly the women who are not in the organization
do not benefit from neither the credit allotted to the group nor the sponsorship program
for their children. Moreover, the government has modified one of his major subsidy
program in order to be allotted only to self-help groups: as a matter of fact, the SGSY99
(Swarnjayanti Gram Swarozgar Yojna), a credit subsidy program for the poor was put in
place by the government to only benefit self-help groups100.

In addition to that, in 2004 the government has launched the Entrepreneurship

Development Program through which individuals are provided trainings, thus 13 000
women have benefited from it, provided that they are self-help groups members101.
Moreover, being a member of a self-help group can confer benefits from banks: for
instance, the Andra Bank in the state of Tamil Nadu has launched a credit card scheme
for self help groups so they could be able to withdraw up to 200,000 rupees in credit. The
woman holding this card can benefit from free insurance as well as scholarships for her
children102. Many more of such positive material selective incentives can be cited. This
again shows how positive selective incentives can play an important role in the
motivations of these women in order to contribute to their share of producing the
collective good within the self-help group.

In addition to the above, self-help groups possess negative selective incentives

mechanisms that sanction non-cooperators. Non-cooperation can be in the form of not
contributing to the individual share of weekly savings, not participating in the weekly
meetings or defaulting the repayment of the loan taken by the group from the bank. When
I asked the women what would they do in such cases: they answered me that in the first
two cases they would put a fine for the non-cooperator. As for the third case, they would
confiscate some precious assets that the defaulting woman possesses until she repays the
loan, and in extreme cases, i.e. when the first method doesn‟t work, they would lock her

99
Refer to section 3.1.1. Self-help groups as an alternative development strategy.
100
Guérin, I. & Palier, J. (2005). Op. cit.
101
Ibid.
102
Ibid.

53
in her house until she pays. The NGOs aid these women in resolving those conflicts as
they provide assistance, guiding and sometimes they will even directly interfere in the
affair. In extreme cases, the non-cooperating woman would be excluded from the group
and would be prohibited from entering any other group in her area as they are sponsored
by the same NGO. As we observe, these mechanisms of coercion are severe and serious
and might lead to the exclusion of the woman. In some self-help groups I visited the first
two cases of non-cooperation were more or less tolerated as there were no important
sanctions. However the third case which is more threatening to the sustainability of the
groups, as discussed in the earlier passages of this section, is not tolerated unless it is an
extreme case were the defaulter faces extreme problems related to family or business,
only then the group accepts the repayment of the loan on behalf of the concerned woman
without excluding her from the group.

As Olson made it clear, these selective incentives are not limited to material non-
collective goods but could also have a social status as prestige, social acceptance and
social status103. These incentives play also an important role in attracting women towards
self-help groups. Another question I asked to the women I interviewed, was: describe for
me the difference in your life, besides credit, that you felt after joining the self-help
groups. I got a wide range of answers that refer to what Olson calls social selective
incentives: for instance some women said that they have become independent from their
husbands, others acquired a group of friends with whom she can share her problems with.
The main trend of answers I got from the women was that they gained peace, made new
friends, and most importantly they have more confidence in themselves. “Before I was
very scared from the people and now I became more confident, and I know about the
people and the group” Kushta told me. Therefore by joining self-help groups, women
have found a new space where they can nurture their personalities, and compensate for
the low self-esteem they had104.

103
Olson, M. (1965). Op. cit.
104
Lahiri-Dutt, K., & Samanta, G. (2006). Constructing Social Capital: Self-Help Groups and Rural
Women‟s Development in India. Geographical Research , 44 (3), :285–295.

54
 When I asked them how they recruit other members, they said that they talk to
their neighbors and friends and tell them about their experience in the group on the
financial level and the personal one. Moreover, self-help groups offer women the
opportunity to be involved in the local political life as the third of the Panchayti Raj seats
are reserved for women. Therefore, as self-help groups have become important actors in
their environment105 through the work they conduct for their communities, the women in
them have gained a social status and feel more able to run for the local elections, for
instance in 2001, 2,612 self-help group women were elected106.

What were presented above are the selective incentives that would normally
operate for a large group but are not necessary for small groups according to Olson. Thus
we showed that these mechanisms perfectly apply to small economic groups like the self-
help groups that also have the advantages of small groups. Self-help groups are usually
constituted from women who more or less know each other, as we already said they
might have not interacted a lot but at least some women in the group know each other. As
many of the women said, one of the most important things they acquired from joining the
group was that they gained good friends, and even sisters. A major condition for the
success of the group is that there exist good interpersonal relationships between its
members. Therefore not contributing in the production of the collective good would lead
to a social burden, as in bad relationship with the members/friends. When a woman is not
contributing, the members talk to her and try to understand the reason behind the non-
cooperation. Sanctions are not immediate, but it is the peer pressure mechanism that
contributes to limiting the number of non-cooperators but it also helps in understanding
and containing them within the confines of the group. Moreover, many groups I met if
not most of them, have a very high attendance percentage, as not many women are absent
from the regular meetings. This is not only due to the fines that the absentee has to pay
but also because the weekly meetings provide women with an additional space away

105
Refer to section 3.1.1. and 3.1.2.
106
Guérin, I. & Palier, J. (2005). Op. cit.

55
from the household and work, and these spaces are used in order to share problems, build
affinities and as a refuge from the daily things that the women go through in their daily
life, therefore it can be considered as a space of socialization and network building.

We have showed that self-help groups are small groups that also use the same
mechanisms that large groups use in order to sustain their organization and the provision
of the collective good. However, one last distinction we have to make in order to follow
Olson‟s logic when analyzing groups. Olson distinguishes between two types of groups:
exclusive and inclusive. An exclusive or an inclusive group is relative to the nature of the
collective good provided. Therefore an exclusive group provides and exclusive good
which can is defined by Olson as the following: “because of the fixed and thus limited
amount of the benefit that can be derived from the collective good, which leads the
members of a group to attempt to reduce the size of their group, this sort of collective
good will here be called an “exclusive good”107.Olson continues to say that by contrast to
exclusive goods, when “the supply of collective goods automatically expands when the
group expands when the group expands, this sort of public good should be called an
inclusive collective good”. From this definition we can conclude that women self-help
groups are also exclusive groups as they provide an exclusive collective good for its
members.

In a matter of fact as we have already précised, self-help groups acquire loans

from commercial banks; these loans present a considerable amount for these women.
However, not all women can get loans at the same time; it is based on a rotating principle
and on needs as well. I have participated in a several meetings of these groups, and in
them women who need loans from the group present their case, the group discusses them
and decides to which woman the loan will be given. Moreover, external actors forming
the groups intend not to have groups having more than twenty members for this reason,
and also for having the advantages of small groups as we have discussed earlier.
Therefore, expanding the group to more than twenty members will diminish the chances
for women to have the loans when they need it as there will be more competition when
107
Olson, M. (1965). Op. cit. p.43

56
presenting their cases. In addition to that, it is important to mention that not in every area
all women are in self-help groups as the NGOs and government do not initiate as many
groups to include all the women. When visiting the groups of CSA, I have noticed that
some women initiated their own groups without the help of the NGO. Nevertheless they
don‟t last and don‟t provide the same amount of the collective good as the NGO initiated
ones because banks don‟t give out loans without NGO or government support. We can
conclude that by their nature and scarcity self-help groups are exclusive groups.

In this section we have showed that self-help groups obey in a direct way to
Olson‟s theory and analysis of groups and collective action. Self-help groups maintain
themselves through several mechanisms of selective incentives according to which
women decide rationally whether to participate or not in the production of the collective
good, thus Olson‟s methodological individualism assumption applies. However, the
functioning of these groups is not de-rooted from the traditions of the environment they
live in neither from the historical continuation of such movements. In the next and last
section of our research we will explore the Gandhian dimension of the self-help groups.

5.2.2. Self-help groups: ingrained in the Gandhian

Philosophy.

Self-help groups emerged in the 1980s as a microfinance scheme; however the

concept of self-help or self- assertion movements isn‟t exactly new to the Indian social
movements108. Let us briefly review those movements: in the year 1925, Periyar E.V.
Ramaswamy launched the Self-respecters Movement in the southern state of Tamil Nadu
based on the principle that all; sections in society should have equal rights to benefit from
the fruits of resources and development in the country, it also called for the abolishment

108
That is not to assert that the self-help group movement is a social movement. We are not undertaking
this kind of analysis of self-help groups, however it would be interesting to study them from the perspective
of social movements theories.

57
of the caste system109. There was also the Gandhian movement (which we will examine
in more depth later on) that was generalized all over the country. The movement stressed
on the need of self-government by the citizens of India. He believed in “sarvodaya”
which means “everything for everyone. He called for decentralization at its maximum as
he believes that power corrupt, thus the country should be decentralized and ruled by
small non-hierarchical councils like the Panchayats. Later on in the 1940s there was the
Telengana Marxist movement which can be seen as a self-assertion movement with a
“thrust on claiming land rights by laborers in the context of the failure of the state to
protect their rights. Many other self-assertion movements emerged later on that ranged
from environmental movements, farmer movements and women movements struggling
against the sale of alcohol in the villages110. We will not speak long about these
movements since they are not our interest in the present study. The only purpose was to
show that self-assertion movements are not an invention brought to India by NGO and
the international institutions like the World Bank but they belong to an Indian tradition.
However we argue that what influenced the self-help groups the most is the Gandhian
tradition of self-assertion.

The concept of self-help was largely popularized by Gandhian philosophy. As we

have already discussed, the notion of self-help is ambiguous and open for interpretation,
however in the Ghandian tradition the concept of self-help is implicitly mentioned in two
concepts which were the basis of the philosophy of Mahatma Gandhi. The first concept is
Swadeshi, which roughly means “self-reliance” which relates to the material concept of
self-sufficiency on all levels ( ranging from the individual to society), thus it means the
reliance on one‟s force111. Some have translated this term in English to “endogenous
development, as Gandhi believed that only Swadeshi could create a community in its
truest sense which means that people could only truly develop as a community. “The
Gandhian dream bases its utopian hopes on the cultivation of certain Indian cultural

109
Rabindranathan, S. (2005). Op. cit.
110
Ibid.
111
Iyer, R. (1993). The Essential Writings of Mahatma Gandhi. Oxford: Oxford University Press.

58
essentials, taken to represent the deep and ancient values of Indian civilization”112. This
vision engenders a collectively oriented society with an individuality ingrained in this
collectiveness.

The second concept used by Gandhi is the one of Swaraj which means self-rule.
In the Gandhian sense it means the emancipation of various forces of coercion, and
exploitation113. The concept of self-rule was used in the context of resistance to the
British colonial rule and foreign imperialism as well as to castes and dominant classes.
According to the Mahatma‟s philosophy, self-determination and self-rule are not
synonymous with individualization. Personal development is perceived as a process not
to be separated or opposed to relationships of solidarity and cooperation. “This is one of
Gandhi‟s key concepts: that individual, community or national freedom is inseparable
from individual, community or national self-reliance.114” Once again, the Gandhian
philosophy inserts the individual in his environment and community, and sees his/her
self-assertion, self-reliance in the context of the community and as an integral part of its
development as well and not in the opposition of collectiveness. In short it doesn‟t place
the individuality in the sense understood by Olson who ignores the social institutions
surrounding the individual as he thinks of organization as a sum of individuals and not as
a whole.

Ghandi sought to revive India‟s long history of justice and non-violence through
these two concepts that we spoke about: swadeshi (self-reliance) and swaraj (self-rule).
“He drew from a rich history tracing the percolation of Buddhist thought and assimilation
into an emergent Hindu faith out of the Vedic tradition”115. Thus Gandhi thought and
envisioned a civil society based on the ancient tradition which is mainly based on dharma
(duty). In this view the citizen in the society of Gandhi is seen through the angle of the
community to which he is a part off. ”Citizenship in this view has more to do with a

112
Otis, M. (2005). Op. cit. p.67
113
Iyer, R. (1993). Op. cit.
114
Otis, M. (2005). Op. cit. p.71
115
Ibid. p.65

59
Citizen‟s responsibility than to do with rights defended by a centralized power”116.
Therefore in this view Raghavan concludes that Gandhi‟s individualism finds its origin in
the concept of Dharma or natural obligation which was the reason behind holding
together the traditional communities in India117.

As we see, the notions of self-help, self-reliance and governance are ingrained in

a long Indian tradition. Maybe it was this factor that helped self-help groups to flourish in
such a manner in India. The “self” concept reinserts the individual in his community and
environment which adds another dimension to the question “why is there collective
action amongst women self-help groups?” Therefore through this new perspective we
acquired through examining the Gandhian philosophy and tradition in Indian movements
we can add more insights to our findings. This fact pushes us to reexamine Olson‟s
reasoning concerning the individual and also Douglas‟ expansion of the theory to small
groups. This is not to say that the analysis of these two authors is invalid, but on the
contrary, inserting a Gandhian perspective permits us to add some relativism to our study.
Thus when examining the women self-help groups we are invited to examine the factors
of solidarity and duty that enter to question, and seeing the community as an essential and
indispensible element contributing to the empowerment of the individual. From this
angle we can understand the works that these women conduct for their village or
slums118.

In her research work about self help groups, M. Otis encountered a woman who
expressed to her in her own words how the Gandhian tradition is influencing self-help
groups when she participated in an event organized by a local self-help group. When the
researcher asked the woman why she volunteered her time in order to contribute to the

116
Ibid. p.67
117
Iyer, R. (1986). The Moral and Political Writings of Mahatma Gandhi: Civilization, Politics and
Religion. Oxford: Clarendon.

118
These works we already spoke about in our first chapter when we were dealing with government and
NGOs. We observed that public services activities are being delegated to women such as cleaning roads,
communicating government campaigns and many other activities.

60
event, she answered: “It is our responsibility. If our sangha (self-help group) can help, it
is our duty to help.” Then when she was asked if she had ever participated in such events,
the woman replied: “No, I worked only for wages then”119. Moreover, when I was
interviewing the women in the one of Bangalore slums, I had a recurrent question: “when
do you feel that you can quit the self-help group.” I expected to get an answer such as:
“when I get out of poverty”, “when I have enough money for the family business to
flourish”, that is answers that reflect the nature of the main collective good that the group
provides credit and saving. However all the answers I got were that none of these women
will ever quit the group because they want to help each other, because they have made
friends and sisters, and that they want to make this opportunity available for other poor
women. This also is a reflection of the influential Gandhian philosophy and tradition of
the Indian self-help groups, who might be seen as a way of concretizing Gandhi‟s vision.
This might be one of the key elements of the popularity of this scheme

119
Otis, M. (2005). Op. cit. p.63

61
 6. Conclusion.

In our research we have tried to grasp the functioning of women self-help groups
in India. We have applied the Olsonian reasoning of groups and collective action on these
community based organizations. In order to do that, we have traced the path of these
groups from their conceptualization to their actual implementation. In a matter of fact in
order to arrive to the conclusion that Olson‟s theory of groups applies to self-help groups,
we had to analyze and study the main actors involved in promoting the self -help groups,
i.e. non-governmental organizations and government. The purpose of this examination
was in order to observe how these actors are shaping their target population making them
suitable for an Olsonian reasoning.

The different state governments and the central government of India have adopted
the self-help group project as the main tool for fighting poverty. It was seen as a way to
conciliate the contradiction between a highly unequal and hierarchical society structured
around the caste system and the egalitarian and democratic vocation of the post-
independence India embodied in its constitution that sought the abolishment of the caste
system towards a more just society. In that sense self-help groups were an instrument for
further decentralization and enhancing participation at the local level, therefore involving
who are considered as the most marginalized in the Indian society, i.e. women. Behind
targeting women, there underlies different assumptions that play a role in shaping them
through circulating a certain style of thoughts. However, women self-help groups, in the
name of empowerment and development, are conducting public service works such as
cleaning the roads, upgrading the neighborhood and communicating government
programs destined to the poorer populations. In short, they are doing the work that the
government once did; therefore the government is somehow instrumentalizing the self-
help groups in a way that they have become low paid public servants, they are used as
well for the government to withdraw from its responsibilities as a provider of public
goods.

62
 The government withdrawal is coupled by the move of the NGOs to the forefront
of this project; they have become the main holders and promoters of the self-help group
scheme. These organization target specifically women since they have given up on men
self-help groups because they have failed. NGOs chose women due to several
representations that they have of them: they have different backgrounds, some of them
are substantial: they deal with the issue of the feminization of poverty, or they adopt a
feminist point of view by approaching the issue from the angle of fundamental rights
considering women‟s access to credit through self-help groups will empower them. There
is also the instrumental approach which contains an economic concern of including
women in the contribution in the growth of the country. The other reason lies in the
assumption that women are financially disciplined and tend to honor their debts more
than men. These assumptions tend to shape women in order to make them suitable for the
representations that these NGOs hold.

One of the main concepts used by NGOs when working with self-help groups, is
the one of empowerment. They claim that through self-help groups, women are being
empowered, i.e. they are gaining power in order to get out of poverty. The concept of
empowerment can hold different definitions, one which is neutral that doesn‟t intent to
change power structures, but only to build capacities. The other one is conflictual; it
implies that when the poor are empowered they take power from those who have it. The
international institutions like the World Bank, as well as NGOs seem to adopt the neutral
definition of empowerment. Through this logic, building capabilities implies acquiring
more credits, developing entrepreneurship and self-initiative. Through this approach to
empowerment, NGOs are circulation the style of thoughts of international institutions to
the women in self-help groups which affects self-help groups by rendering them apt to
the methodological individualism assumption adopted by Olson when analyzing groups.
Therefore in self-help groups, women also conduct a cost-benefit analysis to decide
whether to participate or not.

In our second chapter we have argued that despite their small number, women in
self-help groups obey directly to Olson‟s theory of groups and collective action. In a
matter of fact, through the support of Douglas‟ critique of Olson‟s exclusion of small

63
groups from his theory, we have succeeded in expanding Olson‟s analysis in order to
include small groups. Following the latter‟s typology, women self-help groups can be
classified as an intermediate group, which is a type of small groups. Therefore self-help
groups combine the mechanisms of coercion and selective incentives of large groups and
the advantages of small groups. Hence in order for the women to contribute in the
production of the collective good which is acquiring more credit for the women to take
out loans from, a series of mechanisms enter into consideration. Women are subject to
positive selective incentives which range from the possibility to get out loans from the
groups, health insurance, scholarships for their children. There are also social selective
incentives which are building relationships, having more self-esteem and confidence.
Nevertheless, there exist also coercion mechanisms for women who refuse to contribute
to the production of the collective good: these mechanisms range from paying fine, to
forcing a person to contribute through locking her in her house, and finally exclusion
from the group. Moreover these groups possess the advantages of small groups that
insure the production of the collective good through peer pressure, and through the
maintenance of strong social relationships which might lead to social exclusion in the
case of non-contribution to the production of the good.

Nevertheless, the logic of participation in self-help groups doesn‟t succumb only

to the methodological individualism logic but those groups are rooted in the Gandhian
philosophy and tradition. In fact, the Gandhian movement - which is highly influential in
the Indian society - had promoted the concepts of self-reliance and self-rule which
relocates the Indian individual back to his community. Those concepts promote the
development of the self through the development of society. In light of the Gandhian
input we spoke about, women engage in collective action from the logic of solidarity,
duty and obligation towards the society and not because of a mere cost-benefit
calculation the she conducts.

Self-help groups are highly dependent on NGOs as they provide them with the
bank linkage, but also through them funds are channeled in order to maintain the
activities that the groups initiate like health centre, crèche and other types of activities
that self-help groups conduct. Moreover NGOs intervene often in order to resolve

64
conflicts within the groups120. Thus, for sustainability concerns, NGOs and governments
have started to form self-help groups federations. These federations regroup self-help
groups on the district level and may go beyond. Each group has two representatives in the
federation. These federations are created as a withdrawal strategy by the external actors,
as when they initiate self-help groups they don‟t intend to support them forever.
Therefore self-help groups federations are meant to replace NGOs and government in
order to insure sustainability for the groups that constitute them.

These federations will be responsible for creating self-help groups, getting funds,
and training. Thus they play the same role as NGOs and government, more importantly
they present a support for self-help groups, in the sense that women claims can be better
voiced and addressed on a larger level. Federations also make sure that there is a market
for the women in self-help groups to sell their products, and they offer many financial
services. Therefore it would be very useful to examine these federations, their potential in
strengthening the claim approach of self-help groups, and maybe move self-help groups
to another level, where women are the holders of their own projects rather than driven by
NGOs or government.

120
When interviewing the CSA field coordinator, she told me that they only intervene in the groups
matters when the issue is very serious, which questions the sustainability of self-help groups.

65
 7. Bibliography
Bali Swain, R. (2007). Can Microfinance Empower Women? Self-Help Groups in India.
In A. Dialogue, Microfinance and Gender: New Contributions to an Old Issue (pp. 61-
83). Luxembourg.

Batliwala, S. (1994). Meaning of Empowerment: New Concepts Form Action. In G. Sen,

A. Germaine, & L. Chen, Populations Policies Reconsidered: Health Empowerment and
Rights. Cambridge: Harvard University Press.

Beteille, A. (1999, March 6-13). Empowerment. Economic and Political weekly .

Deshmukh-Ranadive, J. (2005). Can Microfinance Empower Women. In I. Guérin, & J.

Palier, Microfinance Challenges: Empowerment or Disempowerment of the poor? (pp.
113-121). Pondichérry: Institut Français de Pondichérry.

Deshmukh-Ranadive, J. (2004). Women’s Self-help Groups in Andhra Pradesh:

Participatory. Washington: World Bank.

Douglas, M. (1986). How Institutions Think. New York: Syracuse University Press.

Fleck, L. (1935). The Genesis and Development of a Scientific Fact. University of

Chicago Press. Cited in Douglas, M. (1986). How Institutions Think. New York:
Syracuse University Press.

Guérin, I., & Palier, J. (2005). General Introduction. In I. Guérin, & J. Palier,
Microfinance Challenges: Empowerment or Disempowerment of the poor? (pp. 15-35).
Pondichérry: Institut Français de Pondichérry.

Guérin, I., & Palier, J. (2004, May 25-27). Les Self-Help Groups en Inde du Sud en tant
qu'espaces de discussions et d'actions collectives permettent-ils un accès à plus de
"pouvoirs". Communication présentée aux XXèmes journées ATM-CREDES . Nancy.

Harper, M. (2002). Self-help Groups and Grameen Bank Groups: What are the
Differences. In T. Fisher, & M. Sriram, Beyond Micro-Credit: Putting Development Back
into Micro-Finance (pp. 169-198). New Delhi: Vistaar Publications.

66
Hofmann, E., & Marius-Gnanou, K. (2004). L‟empowerment des femmes entre
relativisme culturel et instrumentalisation dans des évaluations de la microfinance en
Inde. Premières journées du GRES. Bordeaux IV.

Iyer, R. (1993). The Essential Writings of Mahatma Gandhi. Oxford: Oxford University
Press.

Iyer, R. (1986). The Moral and Political Writings of Mahatma Gandhi: Civilization,
Politics and Religion. Oxford: Clarendon.

Jakimow, T., & Kilby, P. (2006). Empowering Women: A Critique of the Blueprint for
Self-help Groups in India. Indian Journal of Gender Studies , 13 (3), 375-400.

Kilby, P. (2006). Accountability for Empowerment: Dilemmas Facing Non-

Governmental Organizations. World Development , 34 (6), 951–963.

Kovacs, A. (2005, April 21). NGOs, Women‟s Collectives and Women‟s Empowerment
In India. Thesis handed to Prof.Buckland .

Lahiri-Dutt, K., & Samanta, G. (2006). Constructing Social Capital: Self-Help Groups
and Rural Women‟s Development in India. Geographical Research , 44 (3), :285–295.

Marius-Gnanou, K. (2003, September 22-23). Pratiques économiques solidaires en Inde

rurale : l‟exemple des Self Help Groups (groupes solidaires féminins de microfinance) et
impacts en termes d‟empowerment. Presented at Congrès du réseau Asie .

Mayoux, L. (2000). Micro-finance and the empowerment of women - A review of the key
issues. Geneva: ILO Social Finance Unit.

Mohanakumar, S., & Susan George, S. (2005). Micro Enterprises of Self-Help Groups
and State Policies under a Neo-Liberal Regime: Evidences From a Village in Kerala. In I.
Gérin, & J. Palier, Microfinance Challenges: Empowerment or Disempowerment of the
Poor? (pp. 97-113). Pondichérry: Institut Français de Pondichérry.

67
MYRADA. (2002). Impact of Self Help Groups (Group Processes) on the
Social/Empowerment Status of Women Members in Southern India. Paper presented at
the seminar on SHG–Bank Linkage Programme. New Delhi.

National Bank for Agriculture and Rural Development. (n.d.). A handbook on forming
Self Help Groups. Retrieved July 27, 2009, from
http://www.nabard.org/pdf/publications/manuals/formingshgs.pdf

Olson, M. (1965). The Logic of Collective Action. Cambridge: Harvard University Press.

Otis, M. (2005). Re-Imagining Civil Society in India. Rhode Island: Brown University
Providence.

Palier, J. (2005). Defining the concept of empowerment through experiences in India. In

I. Guérin, & J. Palier, Microfinance Challenges: Empowerment or Disempowerment of
the poor (pp. 35-55). Pondichérry: Institut Français de Pondichérry.

Pant, M. (2004, December). Potential of Self-Help Groups for Enhancing Participation of

Women in Local Self Governance. New Delhi, India: PRIA.

Parsons, T. (1963). On the Concept of Political Power. Proceedings of the American

Philosophical Society.

Purushothaman, S. (1998). The Empowerment of Women in India: Grassroots Women’s

Networks and the State. New Delhi: Sage Publications.

Rabindranathan, S. (2005). Historical analysis of empowerment and its present

understanding in the context of microfinance. In I. Guérin, & J. Palier, Microfinance
Challenges: Empowerment or Disempowerment of the Poor? (pp. 89-97). Pondichérry:
Institut Français de Pondichérry.

Randeria, S. (1999). Entangled histories of uneven modernities: Civil society, caste

solidarities and legal pluralism in post-colonial India. Theory, Cultural and Society.
London.

68
Reddy, C., & Manak, S. (2005, October). Self-Help Groups: A Keystone of Microfinance
in India. Hyderabad: APMAS.

Sabhlok, S. G. (2006). Self-Help as a Strategy for Women's Development in India. 16th

Biennial Conference of the Asian Studies Association of Australia. Wollongong.

Self-Employed Women Association. (2009). Retrieved August 27, 2009, from SEWA:
http://www.sewa.org/About_Us.asp

Sen, A. (1999). Development as freedom. Oxford University Press.

Sivaganga, C. (2004, March 24). SHGs have ushered in rural economic revolutions. The
Hindu .

The Government of India. (1997). Ninth Five Year Plan, 1997-2002. New Delhi: The
Planning Commission of India.

The Government of India. (2002). Tenth Five Year Plan, 2002-2007. New Delhi: The
Planning Commission of India.

Thorp, R., Stewart, F., & Heyer, A. (2005). When and How Far is Group Formation a
Route Out of Chronic Poverty. World Development , 33 (6), 907-920.

Viswanath, V. (1993). NGOs and Women’s Development in Rural South India: A

Comparative Analysis. New Delhi: Vistaar Publications.

World Bank. (2009). Empowerment - Overview. Retrieved August 20, 2009, from The
World Bank:
http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTPOVERTY/EXTEMPO
WERMENT/0,,contentMDK:20272299~pagePK:210058~piPK:210062~theSitePK:4864
11,00.html

69