Economics • Banking & FinanceEasy
In the context of microfinance and Self-Help Group bank linkage programs in Chhattisgarh, what is the primary objective of extending collateral-free institutional credit to women's groups?
A. To foster women's economic empowerment, financial inclusion, and micro-enterprise development through group peer pressure✓ Correct Answer
B. To replace commercial bank branches entirely in remote forest divisions
C. To finance large-scale steel plant construction and heavy industrial machinery
D. To collect agricultural income taxes on behalf of the central government
💡 Solution & Explanation
The Self-Help Group bank linkage program utilizes social collateral and group solidarity to extend microcredit to women's collectives, enabling them to undertake income-generating activities and escape poverty cycles. Chhattisgarh has witnessed substantial socioeconomic upliftment through active mobilization of women into self-help networks. Banks find this model highly effective due to high repayment rates driven by peer monitoring.
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