Who takes the important decisions of SHGs and why?

(i) Most of the important decisions regarding the savings and loan activities are taken by the group members.

(ii) The group decides as regards the loans to be granted-the purpose, amount, interest to be charged, repayment schedule, etc.

(iii) It is the group which is responsible for the repayment of the loan.

(iv) In case of non-repayment of the loan by any one member, it is followed up seriously by other members in the group.

(v) Because of this feature, banks are willing to lend to the poor women when organised in SHGs even though they have no collateral as such.