International Journal of Management, IT and Engineering

Credit is the life blood and key input for the overall development of the economy. Micro credit is used as an effective tool for poverty alleviation by providing small loans at lower interest rate to weaker sections of the society. It offers a platform to develop small business opportunities which includes the entire range of financial services such as savings, money transfers, insurance, production and investment credit as also housing finance and includes the need for skill upgradation and entrepreneurial development that would enable them to overcome poverty.

The present study was designed to analyse the utilisation of micro credit provided to SHGs by SGSY and later under NRLM scheme in Alappuzha District. A Sample of 50 SHGs was takenfrom the Alappuzha Districtusing simple random sampling method. The primary data were collected through interview schedule. The data thus collected were statistically tested by using Chi-square test and Friedman repeated measures analysis of variance on ranksby using SPSS 16.0 for drawing conclusions and interpreting results.

The study revealed that most of the respondents engaged in agricultural and allied activities and all the respondents availed credit facilities. Most of them utilized the loan for starting productive activity. By the utilization of credit, the income level and saving habit of the SHG members were increased. SHG members faced problems, viz. procedural complexity and Non-availability of loan in time. Even though SHG members faced these problems, they were able to engaged in productive activity and generate income for their future.

Most of them utilized the loan for starting productive activity. By the utilization of credit, the income level and saving habit of the SHG members were increased. SHG members faced problems, viz. procedural complexity and non-availability of loan in time.