SELF-HELP GROUP (SHeG)

A Societal Overview

In the old times, the poor, humble or the afflicted were called “ANAW” (a Hebrew Term), those
who could not trust in their own strength but had to rely in utter confidence upon God. They are
the kind of people who have great faith in God – who will save them from day-to-day needs.

In general, the poor are not heard and not accessible to the benefits given by the government or
any organizations. Because of this, many Micro-credit providers do not provide credit to the poor
since they are not creditworthy and do not have collateral.

Today, there are a number of credit providers who allow the poor to loan but most of them do not
provide life changing improvement to the poor families. That is why; most of them are called
loan sharks because of their inhumane and inconsiderate interest rates.

The poor define themselves as failures: financially, socially and in many aspects of life. In the
community, the poor are commonly powerless, hopeless, voiceless and frustrated leaving a huge
impact in their personality and community. Worst, some of them would commit crime and
violence.

They get accustomed to being pushed out, marginalized and excluded. They are placed at the
bottom of the hierarchy and soon will experience loss of human dignity. Being poor instills
hopelessness, fear and apathy. They have no power. They cannot strike against exploitation,
low wages or high rents. Predominantly, they have this kind of attitude: I CANNOT DO
ANYTHING.

Given this attitude, alternative livelihood, opportunity and group solidarity provided by
organizations are seen to be effective ways that can help change the situation of the poor. The
attitudes of the implementing organizations are very important as well. Their actions must not be
inspired out of pity but out of compassion that leads to empowerment of the poor to enable them
take charge of their situation.

Origin of SHeG

In India, poor people especially women were denied by Credit providers, and were not given
opportunity by other institutions. The Mysore Resettlement and Development Agency
(MYRADA), a development organisation in South India looked for an alternate system of micro-
credit that is pro-poor and empowering.

Inspired by the Grameen Bank1 system in Bangladesh, MYRADA adapted the model except for
the supervision of a micro-finance worker and replaced it with a feature that allows the
community members to manage their own group. This new concept of micro-credit system gave

1
Grameen Bank is a Bangladeshi bank which provides credit to the poorest of the poor in rural Bangladesh, without
any collateral.
birth to the formation of Self-Help Group (SHeG) in the mid-1980s, which brought formal
financial services to the rural poor.

Principles and Concepts of SHeG

The principles of SHeG serve as the foundation of its systems and beliefs. The following are the
two of its most basic principles:

 Every human being has tremendous potential in him/herself. This hidden potential can be
unleashed if the environment is provided. With the right environment, SHeG members
can express themselves and develop their whole being with the help of other members. A
person/member will be influenced by other members to save, help, etc.
 As individuals, the poor are voiceless, powerless and vulnerable. By bringing them
together as a homogenous collective group, they have tremendous strength to voice and
address their needs. Each member will find their strength and power being in the group.
Having the same agenda and socio-political background, the poor can now express their
group to others.

The Self-Help approach seeks to bring out the potential of the poor and mainstream them with
the rest of the community. The approach seeks to draw them back from the margins. Once they
start discovering their potential and self-worth, there is no stopping them from development.

Features of SHeG

Self-Help Group (SHeG) is an informal association of poor women (but now accepts men) in a
community usually composed of 15-20 members from similar socio-economic background.

The table below shows the difference between Self-Help Group (SHeG) and Micro-Finance.

SHeG Micro-Finance
 Member from poor family/weaker  Areas/communities are not
section selected
 All members belong to one village  Membership is open to everyone
 Members save on weekly basis what in the community
they can afford  Members save on a monthly basis
 Members make use of their own  Others get sponsorship from micro-
resources financing corporations and
 Members share responsibilities by government committee
rotation basis  NGO sends out their staff to develop
 A facilitator is appointed to work the area and it’s people
with SHeG
The Self-Help Group (SHeG) is strongly promoted by Roman Catholic Archbishop of Cebu-
Relief and Rehabilitation Unit (RCAC-RRU) because of the following reasons:

 It is an effective program in alleviating poverty within the poorest community;

 The approach is cost-effective model and a lot is achieved with minimum investment;
 Motivate women on how they improve themselves as persons; and
 Empower the Diocesan Social Action Centers (DSACs) / Parishes to reach their
parishioners to introduce their advocacies and encourage their involvement.

Also, SHeG has several functions that mobilize, empower and strengthen communities. These
are the following:

 Spiritual Values Formation. Integration of Bible Sharing/MAKALIPANG in every

meeting.
 Savings and Loans. This is the main function of SHeG.
 Promotion of Individual Income Generation Activity (IGA). Each member is encouraged
to have small businesses, where they can loan money from the SHeG as their capital.
 Community Action Programs. Through SHeG, the members can plan a community action
program as part of their activities like feeding program, tree planting, etc.
 Social Action Programs. SHeG members can generate donations to Alay Kapwa.
 Resource Mobilization. The members can mobilize resources outside their group e.g.,
creating linkages and networks with other private and public organizations.
 Identify Areas for New Group formation. SHeG can give birth to another group by
promoting it in the community; or apply the system of savings and loans to existing
groups in the community.
 Motivation on new SHeGs/weaker sections. Helping each member achieve his/her
dreams.

Roles and Responsibilities of the Members

All members of the Self-Help Groups (SHeGs) have different roles and responsibilities. These
are the key tasks that each member has to follow to become a successful SHeG.

Roles Responsibilities
1. Member  Attends group meetings regularly on the agreed day, time
and venue
 Participates actively in group meetings particularly during
Spiritual Values Formation and community social action
plans
 Attends training programs promptly and ensure the
implementation of good practices
 Conducts cash transactions with the SHeG only during
meeting
  Saves at least the minimum amount as agreed upon
 Brings passbook for updating in each SHeG meeting
 Obtains loan for valid purposes
 Prompts repayment of loan with interest
 Ensures the rotation of representatives

2. Moderator  The Moderator leads the meeting of the group in the

agreed day, time and venue. S/he must be replaced by
another member after a month (1) or three (3) months
after depending on the rules and regulations of the group.

3. Controller  Counts the amount of cash at the beginning of the

meeting
 Counts the amount of cash at the end of the meeting
 Checks whether the amount of cash written in the cash
book is correct
4. Book Writers (1 and 2) General Responsibilities of Book Writers:
 Ensure updating of all book accounts
 Ensure that books and documents are kept safely and in
good condition and to produce them whenever required
 Ensure the audit of SHeG finances
 Attend training sessions
 Ensure that a second line of book writers are developed in
SHeG
 Prepare and present the monthly report to members
 Work for improvement of literacy and numeracy skills of
the SHeG members
 Train members in bank transactions

Specific Responsibilities:
4.1 Book Writer 1
 Records the savings of each member in the savings book
 Records the savings of each member on the members’
savings and loan cards
 Counts the total amount of savings received
 Records the amount of savings collected in the cash book
 Records the amount of loans paid back in the cash book
 Records the amount of fees collected in the cash book
 Records the amount of loans given out in the cash book
 Calculates the balance of cash

4.2 Book Writer 2 Specific Responsibilities:

 Records the loans given in the loan book
 Records the loans and interest paid back in the loan book
 Records the loans given and paid back on the members’
 savings and loan cards

The Process of a SHeG Meeting

A. Operating Principles of SHeG

 The group should be formed with “No agenda”. It is important to allow them to identify
their needs and prioritize them.
 No material resources are easily handed out
 Follows non-political and non-religious principles
 Interaction with the community and SHeG are normally done through a Community
Facilitator.

B. Regular Weekly Meeting

 Members meet once a week regularly. They choose the time and day of the week that
suits them best.
 It’s a sharing of struggles and joys.
 It provides an environment where they develop a strong sense of belonging.

C. Circle Seating Arrangement

 It is good for members to sit together in a circle facing each other. The Community
Facilitator or visitors can sit outside the circle.

D. Loan Rules

 Maximum loan amount to be given to a member

 Purposes for which the group will lend
 Rate of interest
 Repayment period of the loan
 Repayment installments or the entire amount
 Loan prioritization
o Purpose for which loan is requested for and its URGENCY
o Regular attendance
o Regular saving
o Ability of the member to manage the asset (Income Generating Activities Loan)
o Capacity of the applicant to repay the loan
o Utilization and repayment of previous loans

E. The Flow of the Meeting

The flow of this meeting assumes that the SHeG has already undergone a BEC orientation
wherein the MAKALIPANG is integrated in the process.
a) Opening Prayer/ Song
b) Gospel Reading
c) Sharing (Assign 2 or 3 sharers if too many members)
d) SHeG Proper
d.1. Roll Call
d.2. Reading of the Minutes of the Previous Meeting (includes correction and approval
of the minutes)
d.3. Business Arising from the Minutes
d.4. Agenda
d.5. Transactions
d.5.1. Announcement of the total Money in the Cash Box
d.5.2. Weekly Savings
d.5.3. Penalty/fees
d.5.4. Loans Payment
d.5.5. Loans
d.5.6. Announcement of the Loan Due Dates
d.5.7. Announcement of the New Total Money in the Cash Box
d.5.8. Close Transactions
e) Other Matters
f) Announcements
g) Closing Prayer

Note: The SHeG can modify their own flow of meeting depending on the group’s decisions.

SHeG Recordings

There are two recordings that the SHeGs must have. First, the Individual Record Book (see
Figure 35) which all members must have and bring every meeting. Second, the SHeG Master
Book (see Figure 36) that incorporates the minutes of the meeting and all other transactions.

A. The Individual Record Book Template

 Savings. It contains the record of the members’ weekly savings (committed amount to
save) and Special Savings (extra money that they want to keep in the group to avoid
unnecessary spending).
 Loan Issued. It contains the recording of the loans of the member: amount of the loan,
interest of the loan, and the period of payment of the loans.
 Loans Repaid. It contains the recording of the loan payments of the member: amount
paid, balances, and interest/charges paid.
 Figure 1. Individual Savings and Loans

B. SHeG Master Book. It contains all the members’ profile, roles and responsibilities, minutes
of the
meetings,
rules and
policies,
and all
other

transactions.
 Figure 2. Sample SHeG Master Book
Guidelines on SHeG Formation

Note: This is just a proposed flow of implementation and the trained facilitators of the
organization can make their own process of implementation which suits best to their community.

I. Week 1: Courtesy Calls

 Good coordination with the Parish Priest and Barangay leaders is the key to a fast
implementation of programs and gain support from authorize people. The
following are the data to be presented:
o Objectives of the SHeG;
o What is SHeG;
o Operating Principles;
o Weekly meetings;
o Management Committee;
o Regulations; and
 o End of the year distribution profit.
II. Week 2: SHeG Orientation and Presentation of the Management Committees
 Assigned facilitators will conduct a SHeG orientation to the identified groups in
the community.
 The facilitator will introduce to the new group the management committee of the
SHeG. Members will choose or nominate who will be assigned as the
management committee. They will undergo special training on basic recordings.

III. Week 3: The Regulations

 The group will write its own regulation. The assigned facilitator will guide them
through the example regulation and make them decide on the following:
o admission fees;
o amount of savings that the members will deposit every week;
o loan terms;
o interest rate on loans;
o time and place of the weekly meeting;
o fines on late repayment of loans; and
o fines on non-attendance (without good reason).

IV. Week 4: Conducting a Meeting

 This activity serves as the first recorded meeting of the group. If the group has
already enough capital, the members can start to loan.

Institutionalization of SHeGs

A. Self-Help Group (SHeG)

When a Self-Help Group (SHeG) grows and becomes successful, there is a big reason to move
forward and advance the group to a larger cause. The successful SHeGs must start looking
outside their circle, and begin helping and forming another SHeG. When there are more Self-
Help Groups – as an institution that helps the poor in a community, the greater the chance to
form a bigger institution.
 Figure 3. SHeG Institutionalization Diagram

B. Cluster Level Association (CLA)

When there are eight (8) to ten (10) strong SHeGs, the groups come together to form a Cluster
Level Association (CLA). Two members from each SHeG are carefully selected to represent the
group at the CLA. The CLA looks into larger issues particularly on the needs of the SHeGs and
the community.

The CLA establishes linkages with other resources and service providers. The CLA also plays
the role of a Duty Bearer to protect the rights of children and the community. As more and more
SHeGs are formed, there are more CLAs established.

C. Federation

When there are eight (8) to ten (10) CLAs, they come together to form a Federation. The
Federation should normally register itself as a Community-Based Organization and thus, has a
legal identity for the entire People's Institution.

The Federation, through its empowered members, seeks to bring social transformation in the
community. By virtue of its strength in numbers, the Federation lobbies with the government and
other civil society players to bring policy changes that are just and fair thereby bringing
sustainable change. The Federation wields power in terms of a people's institution representing a
large number of people.

SHeG: Empowerment or Development

Both empowerment and development are multidimensional. They represent the process of
changes in social structures, popular attitudes, and national institutions; the acceleration of
economic growth; the reduction of inequality; and the eradication of poverty.

The Self-Help Group (SHeG) Approach is a process leading to the empowerment of people. It is
a slow process. Outsiders cannot empower the weaker sections of society. The weaker ones
come together and go through the process of empowerment. However, institutions, NGOs, and
Government agencies can support them through interventions that unleash their potentials,
increase their self-confidence, develop self-reliance, and help set their own agenda.

Self-Help Group (SHeG) is an institution built in the foundation of empowerment (see figure
below).

a) Social - refers to a broad perspective to

include cultural and religious empowerment.
a) Economic - refers to group savings, resource
mobilization and giving opportunity to
generate group or individual income.
b) Political- refers to as being involved in
political issues and activities in the
community.
Social, economic, and political empowerment is required to enable the poorest to claim and
realize their rights as human beings, citizens, and equal partner in civil society.

Figure 4. The Three Foundations of Empowerment

The Levels of SHeG vis-à-vis People’s Empowerment

Level Economic Social Political

SHeG (Level 1)  Savings  A new sense of  A voice for

 Internal identity community
lending  A sense of belonging issues
 Individual IGA  Self-esteem  Participation in
 Group IGA  Care and support local governance
 Resource  Community Action as elected
Mobilization program members
 Social Action program

CLA (Level 2)  Establish credit  Collecting information  Making

linkages and passing on to presence known
 Linkages to member of SHeGs in local
introduce  Establishing linkages governance
technologies in areas of gender  Take up
e.g. food equity, health, activities as
security education and extension arm of
 Plan and nutrition. government
implement  Community/Social  Actively
sustainable action influence local
projects  Make value level decisions
 Human statements for the through
resource community concerted voice
mobilization  Formation/Strengthen of SHeG
 Need-based groups members
skill training

Federation  Coordinate  Collaboration with  Represent the

(Level 3) inter-CLA other Community- community in
business based Organizations decision-making
activities (CBOs) on issue- bodies outside
 Influence trade based programs the federation
policies at  Information  Lobby for pro-
local level dissemination people’s policies
 Establish through at regional /
linkages for newsletter/magazines national level
insurance  Networking with  Organize rallies
schemes other development and other
players awareness
programs