Which of the following is not a feature of Self-Help Groups (SHGs)?

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It consists of 15-20 members or more.

Here, members pool their savings which act as collateral.

Loans are given at a nominal rate of interest.

It is an informal source of credit.

answer is D.

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Detailed Solution

It is an informal source of credit and is not a feature of Self-Help Groups (SHGs).
Self-Help Groups have always been formal sources of credit, with people, especially women coming together to form groups to fund a reserve and help each other in times of credit requirements. The borrower then repays the loan with interest. If the group is regular in its savings, it becomes eligible for obtaining a loan from a bank after a year or two. The group is responsible for loan repayment. Thus, it qualifies as a formal source of credit, just like cooperatives. Self-Help Groups usually consist of 15-20 members or more, and the members pool their savings which act as collateral. SHGs give out loans to their members at nominal interest rates and hassle-free credit terms.

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