International Journal of Advanced Engineering, Management

and Science (IJAEMS)

Peer-Reviewed Journal
ISSN: 2454-1311 | Vol-11, Issue-2; Mar-Apr, 2025
Journal Home Page: https://ijaems.com/
DOI: https://dx.doi.org/10.22161/ijaems.112.3

Women's Economic Empowerment through

Microfinance - Role of Cooperative Banks of
Maharashtra and Karnataka: A Comparative Analysis
Ms. Vijayashri M. Bhagawati1, Dr. Aditya Jagadish2, Ms. Sonal S. Kadam3

Assistant Professor, Vaikunth Mehta National Institute of Cooperative Management(VAMNICOM)-Pune, India

Email: [email protected]
2&3 Research Officer, VAMNICOM-Pune, India

Email : [email protected]

Received: 05 Feb 2025; Received in revised form: 08 Mar 2025; Accepted: 12 Mar 2025; Available online: 18 Mar 2025

Abstract— Economic empowerment is a critical driver for achieving gender equality, poverty reduction,
and inclusive growth. This study examines the pivotal role of District Central Cooperative (DCC) Banks in
empowering women through Self-Help Groups (SHGs) in Maharashtra and Karnataka. By analyzing
secondary data from NABARD reports and other scholarly sources, the research compares the growth
trajectories, savings patterns, and loan disbursement trends across the two states from 2018-19 to 2022-23.
The findings reveal that Maharashtra experienced rapid SHG expansion and increased loan disbursement,
while Karnataka maintained higher per-group financial support despite slower growth. The study
underscores the importance of cooperative banks in enhancing financial access, promoting savings, and
facilitating credit for women SHGs, ultimately contributing to their economic empowerment.
Recommendations include targeted regional strategies, financial literacy programs, and digital banking
solutions to sustain and expand women’s financial inclusion.
Keywords— Economic Empowerment, Self-Help Groups (SHGs), Cooperative Banks, Women’s
Financial Inclusion, District Central Cooperative Banks

I. INTRODUCTION for women sets the direct way to equality between

Economic empowerment is defined as women's and the genders, eradication of poverty and inclusive
men's ability to participate in and contribute to the economic growth. Women make an enormous to
growth process in ways that recognise the value of economies, whether in business, in farms, as
their contributions, respect their dignity, and allow entrepreneurs or as employees or through unpaid
for a more equitable distribution of the benefits of home care. Improving the economic conditions of
growth. ‘’Economic empowerment increases Indian women, the District Central Cooperative
women’s access to economic resources and Banks played an important role in providing them
opportunities including jobs, financial services, with financial opportunities.
property and other productive assets, skill A report by the National Bank for Agriculture and
development and market information’’(Eyben, R and Rural Development (NABARD) in 2022 emphasized
others 2008). that women-led cooperatives play a crucial role in
Social and economic progress is closely linked with improving family and community wellbeing by
women's development, since women account for half expanding access to essential services.
of the Indian population. Economic empowerment

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Bhagawati et al. International Journal of Advanced Engineering, Management and Science, 11(2) -2025

II. REVIEW OF LITERATURE microfinance benefits women's economic and social

Numerous studies have been conducted to assess empowerment. Table 1.1 summarises key studies on
the impact of microfinance on women's economic microfinance and economic empowerment of
empowerment. Several studies have found that women:
Table 1 Summarises key studies on microfinance and economic empowerment of women:
Country/
Author Year Theme/Focus Results
State
Microfinance has brought significant impact on
empowerment of women. Based on these
The impact of
findings, microfinance emerges as a vital tool for
microfinance on
Rajiv poverty reduction and driving social change,
2023 India women's
Gubhaju which are key factors in promoting women's
empowerment in
empowerment. The study highlights the
Rautahat district.
significant role of self-help group microfinance
empowering women.
Women being members of self-help groups
experience an improved standard of living and
greater educational awareness for their children.
The benefits of self-
Sanjeev They become active contributors to social
2022 India help groups achieving
Kumar development rather than passive observers. The
women empowerment
increased financial benefits from these groups
directly enhance the socio-economic
development of women.
Women
Economic growth reduces poverty, and women's
Dr. Deepak India empowerment from
2021 situations improve in two ways: poverty is
S. Vede Maharashtra the view point of
reduced, and gender inequality is reduced.
economic growth
From formation of SHGs increases the savings of
Effectiveness of SHGs the women and thus their economic
Dr. Jutika in economic independencies increase over period of time.
2021 India
Medhi empowerment of Income generation among the women
women beneficiaries are high due to which their
economic conditions also improved.
Smt.
Cooperative banks play an important role in
Ranjitha Role of Cooperative
India increasing the income of the poor, particularly
BR & Dr. 2020 Banks empowering
Karnataka women. Women have a higher economic
Devrajappa women though SHGS
participation rate than men.
S
Kudumbashree
Dr S. Only few entrepreneurial activities are
activities for women's
Frankilin undertaken by the members of Kudumbashree
India economic
Johan, Ms. 2020 and there is significant difference in their attitude
Kerala empowerment in
Nilufar towards women empowerment based on their
Ottapalm
Sathiq year of association
municipality

Dr Shurti 2019 India Bank initiatives in Banks, through various schemes, provide women

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Bhagawati et al. International Journal of Advanced Engineering, Management and Science, 11(2) -2025

Jha India to promote with assistance for earning their livelihoods with
financial inclusion and the aim of making them self-sufficient.
women's
empowerment
Micro financing Micro financing has led to economic
delivered through empowerment of rural women in India. Results
Banks and MFI's have of the Anova model, T-test showed that
Rashmi India
2018 helped women to demographic factors like age, family income, had
Singel Haryana
achieve economic a positive and significant influence on economic
empowerment in rural empowerment of rural women availing micro
areas. financing.

1. Objectives of the Study: extensive cooperative banking systems, high SHG

On the basis of the gaps found in the literature engagement, and major contributions to India’s GDP.
review, the research study's objectives were Both states are leaders in women-cantered
established as follows: microfinance, with Maharashtra supporting over
400,000 SHGs and Karnataka 320,000, enabling broad
1. To assess the role of Cooperative banks in the
rural reach. State policies, such as Maharashtra’s
economic empowerment of women.
"Maha SHG Credit Scheme" and Karnataka’s
2. To study and compare the economic "Udyogini Scheme," further enhance women's
empowerment of women provided by DCC banks in economic empowerment. By 2024, cooperative banks
Maharashtra and Karnataka. in these states have granted financial access to nearly
2 million rural women, improving income,
education, and healthcare, making them ideal for this
To meet the objectives of the study, the researcher
III. RESEARCH METHODOLOGY
used secondary data. The main data is taken from the
Maharashtra and Karnataka were selected for a
status report of NABARD's microfinance annual
comparative analysis on the study as of their

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Bhagawati et al. International Journal of Advanced Engineering, Management and Science, 11(2) -2025

reports. Other data have been collected from IV. DATA ANALYSIS AND
different journals and various publications from INTERPRETATION
other agencies. The Role of Cooperative Banks in Economic
Empowerment of Women through SHGs

YoY Growth of No. of Women SHGs and Savings Amount in

Percentage (2018-2023)
127.29
150
99.63
100
YoY Growth (%)

50 16.9
12.44
-0.68 -4.73
0 5.87
2019-20 2020-21 2021-22 2022-23
-50
-48.12
-100

Number of Women SHGs YoY Growth (%) - Savings Amount YoY Growth (%) -

Fig.1 Year over Year Growth of No. of Women SHGs and Savings Amount in Percentage (2018-2023)
(₹ in Lakhs)
Source: Status of Microfinance Report of NABARD (2018-19 to 2022-2023)

Figure 01 illustrates the trends in the growth of Overall, while SHG membership experienced
Women Self-Help Groups (SHGs) and their collective moderate fluctuations, savings patterns displayed
savings over five financial years, from 2018-19 to more pronounced year-to-year variability, reflecting
2022-23. The number of SHGs initially grew from the dynamic economic environment and resilience of
13.08 lakh in 2018-19 to 13.85 lakh in 2019-20, women’s collective financial initiatives.
reflecting a 5.87% year-on-year (YoY) increase. Figure 02 depicts fluctuating trends in the number of
However, the following years saw slight fluctuations Women Self-Help Groups (SHGs) and the loan
— a minor decline of -0.68% in 2020-21 and a more amounts disbursed from 2018-19 to 2022-23. The
pronounced drop of -4.73% in 2021-22. By 2022-23, number of SHGs saw a modest rise in 2019-20 but
SHG numbers rebounded to 14.7 lakh, marking a declined in subsequent years, with a significant drop
strong 12.44% recovery. in 2021-22. Despite this, loan disbursements
Savings trends exhibited greater volatility. A exhibited consistent growth, culminating in a sharp
significant surge of 99.63% was observed in 2020-21, rise in 2022-23. That year saw a notable rebound,
followed by a sharp decline of -48.12% in 2021-22. with SHG numbers increasing by 21% and loan
The momentum shifted positively again in 2022-23, disbursements surging by 31.88%. This trend
with savings soaring by 127.29%, reaching indicates a continued emphasis on enhancing
₹5,70,417.10 lakh — signalling a robust revival. financial support to women’s groups, even as their
numbers experienced periodic declines.

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YoY Growht of No. of Women SHGs and Loan Disbursed Amount

(2018-23) in Percentage
35 31.88
30
25
YoY Growth (%)

20 15.42 14.21 21
15
7.02
10
5 2.23
0 -3.38
-5 2019-20 2020-21 2021-22 2022-23
-10
-15
-13.34
-20

Number of Women SHGs YoY Growth (%) - Loan Disbursed Amount YoY Growth (%) -

Fig.2 Year over Year Growth of No. of Women SHGs and Loan Disbursed Amount (2018-23) in Percentage
(Amount ₹ Lakh )
Source: Status of Microfinance Report of NABARD (2018-19 to 2022-2023)

YoY Growth of No. of Women SHGs and Loan Outstanding Amount

in Percentage (2018-23)
25
21.88
20.16
20 17.61 18.34
YoY Growth (%)

15
11.98

10
4.81
5
0.77 0.33
0
2019-20 2020-21 2021-22 2022-23

Number of Women SHGs YoY Growth (%) - Loan outstanding Amount YoY Growth (%) -

Fig.3 YoY Growth of No. of Women SHGs and Loan Outstanding Amount in Percentage (2018-23) (Amount ₹ Lakh )
Source: Status of Microfinance Report of NABARD (2018-19 to 2022-2023)

Figure 03 showcases the growth in the number of SHG numbers reached 5.33 lakh, reflecting a more
Women Self-Help Groups (SHGs) and the loan substantial 4.81% increase.
outstanding amounts over five financial years from In parallel, the loan outstanding amounts grew
2018-19 to 2022-23. The number of SHGs steadily, starting from ₹4,96,511.84 lakh in 2018-19.
demonstrated consistent, albeit slowing, growth — Each year saw notable growth, with rates ranging
rising from 4.49 lakh in 2018-19 to 5.03 lakh in 2019- between 17.61% and 21.88%. By 2022-23, the total
20, marking an 11.98% year-on-year (YoY) increase. loan outstanding had more than doubled, reaching
Growth rates then tapered, with marginal rises of ₹10,10,288.48 lakh — underscoring sustained
0.77% in 2020-21 and 0.33% in 2021-22. By 2022-23,

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expansion in credit availability to SHGs, even as the rise in group numbers slowed.
Table.1 the Role of DCC Banks in Number of SHGs and Saving Amount Comparative Analysis
(Amount ₹ Lakh)
Maharashtra State Karnataka State
Sr. Number of Saving Number Saving
Year Saving
No women Saving amount Amount Per of women Amount
amount
SHGs SHG SHGs Per SHG
1 2018-19 3,37,925 39,397.90 0.12 2,24,966 42,385.22 0.19
2 2019-20 3,99,613 42,028.52 0.11 2,35,356 42,748.68 0.18
3 2020-21 3,59,231 1,42,981.04 0.40 2,41,009 46,419.15 0.19
4 2021-22 3,67,754 37,362.85 0.10 2,42,771 50,382.02 0.21
5 2022-23 14,73,363 5,70,417.10 0.39 2,55,897 48,648.04 0.19
CAGR (%) 44.50 95.07 - 3.27 3.51 -
Average - - 0.22 - - 0.19
Source: Status of Microfinance Report of NABARD (2018-19 to 2022-2023)

Table 01 highlight contrasting growth trends in Maharashtra experienced remarkable growth in loan
Women Self-Help Groups (SHGs) and total savings disbursement per SHG, rising from ₹0.71 lakh in
between Maharashtra and Karnataka from 2018-19 to 2018-19 to ₹3.13 lakh in 2022-23, driven by an
2022-23. impressive Compound Annual Growth Rate (CAGR)
Maharashtra witnessed remarkable expansion, with a of 123.6%. The number of SHGs expanded
Compound Annual Growth Rate (CAGR) of 44.50%. significantly, from 42,369 in 2018-19 to 2,41,142 in
The number of SHGs surged from 3.37 lakh in 2018- 2022-23, reflecting a substantial increase in outreach
19 to 14.73 lakh in 2022-23, while total savings and financial inclusion. The average loan disbursed
skyrocketed from ₹39,397.90 lakh to ₹5,70,417.10 per SHG over the five years stood at ₹1.23 lakh.
lakh. Savings per SHG fluctuated during this period, Karnataka, on the other hand, showed moderate but
peaking at ₹0.40 lakh in 2020-21, with an overall steady growth. Loan disbursement per SHG
average of ₹0.22 lakh. increased from ₹2.75 lakh in 2018-19 to ₹4.49 lakh in
In contrast, Karnataka experienced slower growth, 2022-23, with a CAGR of 24.5%. Total loan
with a modest CAGR of 3.27%. SHG numbers rose disbursement rose from ₹82,646.59 lakh to
from 2.25 lakh in 2018-19 to 2.56 lakh in 2022-23, and ₹1,98,374.51 lakh over the period. Notably, Karnataka
total savings increased from ₹42,385.22 lakh to consistently maintained a higher loan amount per
₹48,648.04 lakh. Savings per SHG remained steady, SHG than Maharashtra, with an average loan
averaging ₹0.19 lakh throughout the years. disbursement per SHG of ₹3.62 lakh.

The data underscores Maharashtra’s rapid expansion The data underscores Maharashtra’s rapid expansion
in both SHG formation and savings accumulation, in SHG numbers alongside growing loan support,
while Karnataka maintained stability with gradual while Karnataka sustained a more stable, higher
growth. loan-per-group model, prioritizing larger credit
access to fewer groups.
Table 02 compares loan disbursement trends for
Women Self-Help Groups (SHGs) in Maharashtra
and Karnataka from 2018-19 to 2022-23, highlighting
contrasting growth patterns.
Table No. 02: The Role of DCC Banks in Number of SHGS and Loan Disbursed Comparative Analysis

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(Amount ₹ Lakh )
Maharashtra State Karnataka State
Loan Loan
Sr. Loan
Year Number Loan disbursed Number disbursed
No disbursed
of women disbursed during the of women during the
during the
SHGs during the year year per SHGs year per
year
SHG SHG
1 2018-19 42,369 30,231.30 0.71 30,103 82,646.59 2.75
2 2019-20 48,966 33,832.39 0.69 34,271 1,13,792.19 3.32
3 2020-21 30,688 23,670.19 0.77 32,332 1,15,150.43 3.56
4 2021-22 32,585 27,558.46 0.85 32,136 1,27,555.45 3.97
5 2022-23 2,41,142 7,55,049.95 3.13 44,204 1,98,374.51 4.49
CAGR (%) 54.4 123.6 - 10.1 24.5 -
Average (Rs. In
- - 1.23 - - 3.62
Lakh)
Source: Status of Microfinance Report of NABARD (2018-19 to 2022-2023)

Table.3: The Role of DCC Banks in Number of SHGS and Loan Outstanding Comparative Analysis
(Amount ₹ Lakh )
Maharashtra State Karnataka State

Total Bank Total Bank Total Bank

Sr. Total Bank Number
Year Number Loan Loan Loan
No Loan of
of women Outstanding Outstanding Outstanding
Outstanding women
SHGs during the during the during the
during the year SHGs
Year per SHG year Year per SHG

1 2018-19 52,042 22,858.45 0.44 65,801 1,04,163.91 1.58

2 2019-20 30,161 27,509.50 0.91 69,544 1,25,773.97 1.81
3 2020-21 34,042 31,272.43 0.92 68,199 1,50,994.63 2.21
4 2021-22 30,952 28,979.53 0.94 75,663 1,80,995.62 2.39
5 2022-23 5,32,851 10,10,288.48 1.90 84,104 2,39,176.62 2.84
CAGR (%) 78.9 157.8 - 6.3 23.1 -
Average (Rs. In
- - 1.02 - - 2.17
Lakh)
Source: Status of Microfinance Report of NABARD (2018-19 to 2022-2023)

Table 03 compares the total bank loan outstanding 2018-19 to 5,32,851 in 2022-23. Total bank loan
for Women Self-Help Groups (SHGs) in Maharashtra outstanding saw an extraordinary rise from
and Karnataka from 2018-19 to 2022-23, revealing ₹22,858.45 lakh to ₹10,10,288.48 lakh over the same
notable differences in growth patterns.In period. Loan per SHG increased sharply from ₹0.44
Maharashtra, SHG numbers surged from 52,042 in lakh in 2018-19 to ₹1.90 lakh in 2022-23, reflecting an

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impressive Compound Annual Growth Rate (CAGR) accumulating larger loan balances, possibly due
of 157.8%. The average loan outstanding per SHG to higher borrowing needs or increased lending
during this period stood at ₹1.02 lakh. In Karnataka, limits by cooperative banks, compared to
SHG numbers grew more gradually, from 65,801 in Karnataka.
2018-19 to 84,104 in 2022-23. Total loan outstanding • Comparison Between Maharashtra and
increased from ₹1,04,163.91 lakh to ₹2,39,176.62 lakh. Karnataka in SHG Savings and Loan
Loan per SHG rose from ₹1.58 lakh in 2018-19 to Disbursements
₹2.84 lakh in 2022-23, with a CAGR of 23.1%. The Maharashtra experienced a much higher growth
average loan outstanding per SHG was ₹2.17 lakh — rate in both SHG numbers and total savings
consistently higher than Maharashtra’s.The data compared to Karnataka. The savings per SHG in
highlights Maharashtra’s rapid expansion in SHG Maharashtra varied, peaking in 2020-21, while
numbers and total loan support, reflecting a large- Karnataka’s savings per SHG remained relatively
scale push for financial inclusion. Karnataka, by consistent. For loan disbursements,
contrast,maintained slower but stable growth, with Maharashtra’s growth rate in loan amounts per
higher loan outstanding per SHG, suggesting a focus SHG was markedly higher, indicating significant
on deeper financial backing for each group. expansion of financial services. However,
Karnataka consistently provided a higher loan
amount per SHG, suggesting stronger per-group
V. FINDINGS OF THE STUDY
financial support in Karnataka.
• Growth and Fluctuation in SHGs and Savings
• Loan Outstanding Comparison Between
Across Years
Maharashtra and Karnataka
From 2018-19 to 2022-23, Women Self-Help Groups Maharashtra saw substantial growth in total
(SHGs) demonstrated overall growth, despite yearly bank loan outstanding per SHG, with a high
fluctuations. SHG numbers initially increased, faced CAGR in loan per SHG over five years, reflecting
a slight decline, and then rebounded significantly by increasing financial dependency or banking
2022-23. Total savings followed a similarly volatile support. Karnataka’s growth was more
trajectory — showing notable growth in 2020-21, a moderate, yet it maintained a consistently higher
decline in 2021-22, and a strong recovery in 2022-23. loan per SHG, emphasizing quality over quantity
This pattern reflects resilient efforts to rebuild and in its support structure.
expand group savings after periods of instability.
• Loan Disbursement Trends VI. RECOMMENDATIONS
Loan disbursement amounts consistently • Enhance Cooperative Banks’ Support to Women
increased year-over-year, signaling growing SHGs for Economic Empowerment
financial support to women SHGs. The YoY Cooperative banks should strengthen their
growth in loans was especially pronounced in financial services for Women SHGs by providing
2022-23, demonstrating a marked increase in consistent and adaptable credit support,
access to credit for SHGs despite some volatility especially during periods of economic
in the number of SHGs. This suggests a focused uncertainty. Programs that offer flexible loan
attempt by cooperative banks to strengthen terms, repayment holidays, or lower interest
women's economic empowerment through rates during difficult times can stabilize savings
steady loan disbursements. and help SHGs manage financial volatility, as
• Growth in Loan Outstanding Amounts seen in the fluctuating savings and loan growth
Both Maharashtra and Karnataka saw growth in patterns from 2018-19 to 2022-23.
SHG loan outstanding amounts, although at • Adopt Targeted Approaches for Regional
differing rates. The total outstanding amounts in Growth in Maharashtra and Karnataka
Maharashtra grew significantly more rapidly Given the high growth in Maharashtra and the
than in Karnataka, with a much higher CAGR. slower, steady expansion in Karnataka,
This indicates that Maharashtra's SHGs are cooperative banks should implement customized

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regional strategies to optimize SHG programs focused on sustainable business

empowerment. In Maharashtra, banks could practices, including entrepreneurship, budgeting,
focus on financial literacy and investment and debt management. These programs should
programs to ensure effective utilization of the be designed to empower SHG members to
rapidly growing loans and savings. In Karnataka, leverage loan funds for income-generating
banks should focus on expanding SHG numbers activities, reduce debt dependency, and ensure
and increasing credit access, given the region's responsible financial practices.
higher average loan per SHG but more gradual • Facilitate Knowledge Exchange Between
SHG growth. Maharashtra and Karnataka
• Strengthen Financial Literacy and Savings Given the different growth trajectories in
Incentives in Maharashtra Maharashtra and Karnataka, cooperative banks
With Maharashtra’s savings per SHG displaying should facilitate knowledge exchange between
significant growth but also variability, SHGs in both states. Maharashtra’s SHGs could
cooperative banks should emphasize financial learn from Karnataka’s effective loan utilization,
literacy programs that encourage SHGs to while Karnataka could benefit from
consistently save and reinvest. Introducing Maharashtra’s strategies for rapid SHG
incentives like savings-linked rewards or expansion. This knowledge-sharing platform
matching contributions could help stabilize could include workshops, webinars, and cross-
savings rates and foster sustainable financial state SHG networking events, fostering
growth. collaborative growth and skill development.
• Increase Loan Accessibility and Responsiveness • Conduct Regular Impact Assessments
in Karnataka Cooperative banks should conduct regular
• While Karnataka’s SHGs receive a higher impact assessments to evaluate how loans and
average loan per SHG, there is room for growth savings are improving the economic
in SHG numbers and total loans. Cooperative empowerment of SHG members. By tracking
banks should work to streamline loan access metrics like income growth, business
procedures and increase outreach efforts, sustainability, and financial independence, banks
especially in underserved areas. Additionally, can refine their support programs and ensure
cooperative banks could offer higher credit limits they are meeting the empowerment goals
and streamlined loan renewal processes to help outlined in their mission.
SHGs expand their operations more effectively.
• Promote Digital and Financial Inclusion for Both VII. CONCLUSION
States The data reveals that cooperative banks play a
Digital banking solutions tailored for SHGs pivotal role in supporting Women SHGs, as
could simplify transactions and loan evidenced by their commitment to expanding loan
management, particularly for rural SHGs that disbursements and facilitating savings. Cooperative
may have limited access to physical bank banks, especially District Cooperative Central (DCC)
branches. Cooperative banks should develop banks, appear to be instrumental in empowering
mobile apps or online portals that allow SHGs to women economically by ensuring credit access and
view balances, manage loans, and receive alerts promoting financial growth among SHGs.
on savings opportunities. Such digital solutions
In comparing Maharashtra and Karnataka,
would enhance accessibility and improve
Maharashtra has demonstrated greater growth in
financial tracking for SHGs in both Maharashtra
SHG numbers and total loan disbursed amounts,
and Karnataka.
highlighting rapid expansion and robust support
• Expand Training Programs for Sustainable SHG
mechanisms from DCC banks. Karnataka, though
Management and Growth
showing a slower growth trajectory in SHG numbers
To maximize the benefits of loans and savings,
and loan disbursement amounts, has consistently
cooperative banks should introduce training
provided a higher per-SHG loan amount,

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