Summarizing some takeaways from a recent conference on “Conference on Governance and Sustainable competitiveness within Ag Collectives” hosted by VAMNICOM
Conference Agenda
Papers
Notes
On Dec 16, a few presenters talked about the role and current status of SHG Cluster Level Federations with a focus on how these CLFs create value for their members. What is the right governance model that enables SHGs to compete in a global market?
Efficiency is necessary but not sufficient for SHGs and collectives; overall member wellbeing and environmental sustainability also critical. This is different from a corporate model.
CS Reddy from APMAS made a few points:
APMAS recently hosted a Vision 2030 workshop on the vision for CLFs. 75 women leaders participated and shared their ambitions. See this paper for a summary
Poverty-free & Equitable Society: SHGs and their federations to evolve into autonomous, independent, self-reliant, sustainable, modern and agile institutions owned, managed, controlled & used by women strongly supported by an enabling ecosystem for the SHG movement to realize its full potential of social, economic & political empowerment of women and their families free of poverty & deprivation.
Creation of wealth in an equitable gender-just society that enhances quality of life of women: SHGs and their federations to evolve into autonomous, independent, self-reliant, sustainable, resilient institutions owned, managed and utilized by women strongly supported by an enabling ecosystem for the SHG movement to realize its full potential of social and economic empowerment of women.
Major needs of CLFs:
Digitization: enable CLFs to come together to share data; rating and performance assessment of CLFs
Uniform legal structure for SHGs; similar to MAACS Act or Bihar Self Supportive Cooperative Act (link). Right now, federations are a mix of formal and informal
What role should CLF play? Envision a three tier structure with SHGs (average 12 members) → Village Organizations (VOs) → Cluster Level Federations. Each layer adds complexity and cost and needs to add value. So what do CLFs do to add value?
Self regulatory organization; ensure SHGs have accounting / book-keeping, protect savings, performance monitoring
Audit, elections, good governance practices (at the SHG and VO levels)
Financial intermediaries: play the role of business correspondent for banks
Mature SHG federations can either promote/incubate FPOs or be recognized as FPOs (promote CHCs, decentralized food processing, collection center, marketing)
Note, much of this is similar to the role that SHG promoting orgs have played in the past
Mutual benefit organizations; for profit but this is channeled towards increasing member income
No one size fits all; flexibility for SHG federations to be autonomous business orgs with their own biz plan.
Need a fee-based service model so they are not reliant on govt to cover operational costs.
Vijaylakshmi, CGM from NABARD shared stats on SHGs from a financing perspective
NABARD setup E-Shakti portal to digitize SHG data to encourage bank linkage. See here for detail
Credit and non-credit history of the group is captured; NRLM and non-NRLM grading norms
Data on 12 lakhs groups
Ranjani Murthy MYRADA, IFAD consultant covered “What is the right governance model for SHG federations to create value?”
Governance: definition from UNESCO; need a bottoms-up approach
Value creation: Economic important but also need to consider social (political, social welfare, safety); how does value creation happen in a sustainable manner
MFIs are gaining share relative to SHGs
Devesh Kumar, Project Manager for Marketing and Innovation for JEEViKA shared perspectives on what CLFs do and a case study on bananas where CLFs are playing an FPO promotion role
