Global Journal of Management and Business Studies.

ISSN 2248-9878 Volume 3, Number 7 (2013), pp. 703-710

© Research India Publications
[Link]

Entrepreneurship and Small Business- A Study with

Reference to Women Self Help Groups

Major R. Rajasekaran1 and R. Sindhu2

1, 2
Department of Commerce, PSG College of Arts and Science, Bharathiar University
Avinashi Road, Civil Aerodrome post, Coimbatore, India.

Abstract

Women entrepreneurship has been recognized as an important source

of economic growth as they create new jobs for themselves and others
and also provide society with different solutions to management,
organization and business. Women’s entrepreneurship contributes to
the economic well-being of the family and communities and also
reduces poverty. The growth of Self-Help Groups (SHGs) is an
evidence of the fact that women are coming out of their shells and
maintaining their citizenship in the city. This study is carried out with
the specific objective to know the socio- economic background of the
women SHG’s, their knowledge, skills and earning capacity. Keeping
this in mind the researcher made a study on entrepreneurship and small
business with reference to Women SHGs in Coimbatore City. Research
data have been collected from various available sources and
systematically analyzed with suitable tools. The analysis clearly shows
that the role of women entrepreneurs’ contribution to the society is
commendable.

Keywords- entrepreneurship; Self Help Group; Organization; Socio-

economic; commendable.

1. Introduction
Entrepreneurship plays an eminent function in creating an avenue for employability for
rural communities, providing self-employment for those who have started-up a
business of their own and enhancing the economic status of the rural sector as well.
Entrepreneurship has transformed many entrepreneurs into successful business persons
704 R. Sindhu et al

and generated income for rural communities. Women Entrepreneurs may be defined as
the women or a group of women who initiate, organize and operate a business
enterprise. Self-Help Group is a small voluntary association of poor people preferably
from the same socio-economic back drop. The micro-credit given to them makes them
enterprising; It can be all women group, all-men group or even a mixed group. A self-
help group (SHG usually composed of 10–20 local women. In India, many SHGs are
'linked' to banks for the delivery of micro credit for small business.

1.1 Statement of problem

Women in India have been oppressed culturally, socially, economically and politically
for centuries. They are exploited at home, in the families, in the society and in the
country. In the Multi ethnic and multi cultural society like that exists in India, such
exploitation takes various Forms. The core of the problem is that they shoulder a
number of responsibilities, but they are not given adequate participatory or decision
making power in the family or elsewhere. Women Can gain such power, if their
economic status, cultural and social status improves. Such type of Overall
improvement can be taken care by SHGs. Involvement in Self Help Groups has
enabled women to gain greater control over resources like material possession,
intellectual resources like knowledge, information, ideas and decision making in home,
community, society and nation.

1.2 Objectives of the study

 To know the socio-economic status of Women Self Help Groups in Coimbatore
city.
 To evaluate the performance of women self Help Groups in entrepreneurship.
 To identify the issues related to the Women Self help groups.
 To offer suggestions based on the findings.

1.3 Scope of the study

The present research is to study the critical study of self help groups with reference to
Coimbatore District. This study would be of great help to the implementing agencies to
bring necessary improvements in the self help groups for attaining the over all
improvement of women. The knowledge on these aspects could be used to develop
strategies to motivate self help group members for their enhanced participation in the
group. Further the study would highlight the role and importance of microfinance
institution in SHGs.

1.4 Methodology
The data used for the study is secondary data comprising of official websites, journals,
magazines and articles. The geographical area selected for the study is Coimbatore.
Limitation of the study is that the area is confined only to Coimbatore. Since the data is
secondary it is more dependable and reliable. The present study covers only women
entrepreneur who are the members of SHGs.
Entrepreneurship and Small Business- A Study with Reference to Women 705

2. Review of Literature
Govindarajan, Latha Padhmanabhan, V1 examined the relationship between
women Self-Help Group (SHGs) satisfaction and process dimensions of workgroup
characteristics. Women SHGs are formed with a purpose of promoting women's
economic and social empowerment. Members are motivated to engage in any
economic activity in groups like producing bakery products, home furnishing
decorative items, packaged readymade food mixes, etc. These SHGs are selected
through eight NGOs that are affiliated with women's welfare program, a scheme under
'Mahalir Thittam', Women'sWelfare Project, Coimbatore District Collectorate, Tamil
Nadu, India, using multistage sampling.
Suja, S2 Global Management Review. 2012, Vol. 6 Issue 3, found out that
Association in Self Help Groups has enabled women to gain greater control over
resources like material possession, intellectual resources like knowledge, information,
ideas and decision making in home, community, society and nation. The SHGs
crosswise states have paved attention on skill improvement, facilitating invention,
gaining access to credit from financial institutions for micro enterprises / projects,
inculcating of frugality: and supervision of credit for the economically destitute
sections of women. Since Government is concentrating on women Self Help Group for
the economic growth and poverty elevation, this study becomes the need of the hour.
Vetrivel S.C3 Advances in Management. Jun2010 studied that In India, the
emergence of liberalization and globalization in early 1990's aggravated the problem of
women workers in unorganized sectors from bad to worse as most of the women who
were engaged in various self employment activities have lost their livelihood.
Microfinance is emerging as a powerful instrument for poverty alleviation in the new
economy. In India, Microfinance scene is dominated by Self Help Group (SHGs) -
Bank Linkage Programme as a cost effective mechanism for providing financial
services to the "Unreached Poor" which has been successful not only in meeting
financial needs of the rural poor women but also in strengthening collective self help
capacities of the poor leading to their empowerment
Bali Swain, Ranjula Wallentin, Fan Yang4 International Review of Applied
Economics. Jul2012 evaluated the impact of economic and non-economic factors on
women’s empowerment of Self-Help Group (SHG) members. We estimate a structural
equation model (SEM) and correct for ordinality in the data to account for the impact
of the latent factors on women’s empowerment. Our SEM results reveal that for the
SHG members, the economic factor is the most effective in empowering women.
Greater autonomy and social attitudes also have a significant women empowerment
impact.
K., Geetamma Bulla, B.5 Golden Research Thoughts. Jul2013. Studied that the
Micro finance through Self Help Group (SHG) has been recognized internationally as
the modern tool to combat poverty and for rural development. Micro finance and
SHGs are effective in reducing poverty creating awareness which finally results in
sustainable development of the nation.
706 R. Sindhu et al

3. Women Entrepreneurship in India

3.1 Introduction of Women Entrepreneur
Entrepreneurship is the purposeful activity of an individual or a group of associated
individuals, undertaken to initiate, maintain or aggrandize profit by production or
distribution of economic goods and services. The government of India has defined
Women Entrepreneurs based on women participation in equity and employment of a
business enterprise. Accordingly, a women entrepreneur is defined as “those women
who think of a business enterprise, initiate it, organize and combine the factors of
production, operate the enterprise and undertake the risk and handle economic
uncertainty involved in running a business enterprise It is estimated that women
entrepreneurs presently comprise about 10% of the total number of entrepreneurs in
India, with the percentage growing every year. If the prevailing trends continue, it is
likely that in another five years women will comprise 20 % of the entrepreneurial
force. Even though women own around 10% of the total enterprises in the small sector,
the gross output of these units is just 3.5% of the total output of the SSI sector. In
contrast, in developed countries such as United States, women own nearly 91 lakh
small businesses and the number of women-owned start-ups is going at nearly twice
the rate of their male counterparts. India has 397 million workers, 123.9 million are
women, 106 million are in rural areas, 18 million are in urban areas , Only 7% of
India’s labour force is in the organized sector; 93% is in unorganized sector.

Women Entrepreneurs in India

State No of units No of women %
Registered entrepreneurs
Tamil Nadu 9618 2930 30.36
Uttar Pradesh 7980 3180 39.84
Kerala 5487 2135 38.91
Punjab 4791 1618 33.77
Maharashtra 4339 1394 32.12
Gujarat 3872 1538 39.72
Karnataka 3822 1026 26.84
Madhya Pradesh 2967 842 28.38
Bihar 7344 1123 15.04
Other States & UTS 14576 4185 28.71
Total 64796 19971 32.82
Source: CMIE report 2011

3.2 Self Help Groups

In 1975, Prof. Mohammed Yunus of Bangladesh in an effort to bring the efforts of the
women force to the main stream of economy started self-help groups in Bangladesh
and inculcated the habit of thrift and savings among the poorest. Now, the women
groups have grown with a bank named Bangladesh Grameen Bank (Karmakar K.G.,
Entrepreneurship and Small Business- A Study with Reference to Women 707

1999). The Self-Help Groups being comprised of group of persons get empowerment
to solve most of their problems of non-financial marketing, better adoption of
technology and training for realizing the human potential for entrepreneurial
development. The objective of SHGs is to develop strong, cohesive, self help women
groups through inculcation of spirit of self help and team spirit. This results in overall
leadership development through exposure to SHGs management change from workers
status to managers status by putting control in their own hands, access to market
through training, assisting and encouraging need based tapping of alternate resources
inclusive of capital.

4. Analysis and Findings

The role of women entrepreneurs is increasing drastically every year. The participation
of women has increased from 22.3 in 1990-1991 to 31.6% in the year 2010-2011. This
is a source from the world bank report 2010-2011 & WAWE conference report.

4.1 SGHs across India

No. of SHGs No. of Women SHGs Percentage of women

Year Formed Total Formed Total Since SHGs Formed Total Since
Since 1.4.99 1.4.99 1.4.99
2009-2010 3708410.35 2651450 71.49
2010-2011 3988926.34 2955287.79 74.08
2011-
2012 till 3943127 2865212 72.66
28/08/2011
Source: Source- [Link] retrieve on 28th August 2011.

4000000

3000000

2000000
2009-2010
1000000
2010-2011
0
no of no of % of 2011-2012
SHGs women women
formed SHGs SHGs
formed
708 R. Sindhu et al

71.5% of the women SHGs formed in 2009 and 2010. For the duration of 2010-
2011, this ratio stood at 74.08%. Out of the whole figure of Self Help Groups formed,
70% belong to women.

4.2 Micro Finance

Micro Finance institution started in India in 1980s through Self Help Groups (SHGs)
model. It is the Grameen replication model of Bangladesh. Self Help Groups have
emerged as an alternative development strategy to promote the common interest of the
weak particularly the rural poor. Microfinance programme in India is growing rapidly
and receiving increasing attention from the financial institutions, non-governmental
organizations (NGOs) and the Government, as an instrument that can transform lives
of the women. Microfinance took roots in 1992-93 with the launching of the Self-Help
Group (SHG)-Bank linkage programme by the National Bank for Agriculture and
Rural Development (NABARD). Up to March2005, over 16.18 lakh SHGs had been
linked with banks with 24.25 million poor families being brought within the fold of
formal banking services. The cumulative bank loan disbursed since the inception of the
programme stood at Rs 6,898.46 crores. Over 90 per cent of the SHGs linked to banks
under this programme comprise women groups. In this process, 35294 branches of 560
banks comprising 48 commercial banks, 316 cooperative banks and196 RRBS have
been involved in disbursing credits to SHGs. Currently, a total of 25 lakh such
women's SHGs across the country access loans at rates ranging from 11.5% to
14%.The government expects the number of women's SHGs to swell up to 60 lakh and
their total membership to increase to 7 crore in the next five years. Currently, these
SHGs have a total of 3 crore members. Commensurate with the rise in the number of
SHGs, the government believes that the size of the total loan disbursed to the sector
will also increase from Rs 20,000 crore to Rs 1 lakh crore within the time period.

5. Suggestions
 There should be continuous attempt to inspire, encourage, motivate and co-
operate women entrepreneurs.
 SHGs should be provided with more loans from the government.
 The government should introduce entrepreneurial development programme for
women.
 Finance should be made available to women entrepreneurs at a reduced rate of
interest.
 Better educational facilities and schemes should be extended to women folk
from the government.
 Extension participation programme may be arranged with extension agencies
for the SHGs to visit their business houses to know the functions and its
administration so that it creates awareness among the women group.
Entrepreneurship and Small Business- A Study with Reference to Women 709

6. Conclusion
Self employment is better suited to women. If she is her own master of any of her work
schedule, she can adjust her work. At present women have broken the monopoly of
men and proved that they are not inferior to men. Over the past few decades the
women has been breaking traditional role of a mother or a house wife. It is clear from
the study that women entrepreneur of SHGs has good work force, under the dynamic
setting of business, if women entrepreneur is given a proper guidance and training to
enhance the profitability of the enterprises the future will be bright and prosperous.

References
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710 R. Sindhu et al