Consider the following statements :
- 1.The Self-Help Group (SHG) programme was originally initiated by the State Bank of India by providing microcredit to the financially deprived.
- 2.In an SHG, all members of a group take responsibility for a loan that an individual member takes.
- 3.The Regional Rural Banks and Scheduled Commercial Banks support SHGs.
How many of the above statements are correct?
Show answer
Answer: B. Statement 1 is wrong: the SHG-Bank Linkage Programme was started by NABARD in 1992, not SBI. Statement 2 is correct: members share responsibility for loans, which works as group guarantee. Statement 3 is correct: Regional Rural Banks and commercial banks lend to SHGs. So only two.
Watch for: SBI is the biggest bank, so students guess it started everything; NABARD did.
Why the other options are wrong
- A. Wrong because statements 2 and 3 are correct.
- C. Wrong because NABARD, not SBI, started the SHG programme.
- D. Wrong because statements 2 and 3 are correct.
Source to check: NABARD website, SHG-Bank Linkage Programme; NABARD, Status of Microfinance in India 2022-23
Answer from the official UPSC key. Written and fact-checked by AI against the official key. Spotted a mistake? Report it.