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?

1. A. Only one
2. B. Only two
3. C. All three
4. D. None

Answer: B

Explanation

Let’s analyze the statements regarding Self-Help Groups (SHGs):
1. **Statement 1**: Incorrect. While the State Bank of India is a major participant, the SHG-Bank Linkage Programme in India was primarily initiated and promoted by NABARD in 1992, drawing inspiration from successful microfinance models like Bangladesh’s Grameen Bank.
2. **Statement 2**: Correct. A fundamental principle of SHGs is collective responsibility and mutual guarantee. All members of the group are collectively responsible for the repayment of loans taken by any individual member, fostering financial discipline and peer support.
3. **Statement 3**: Correct. Regional Rural Banks (RRBs) and Scheduled Commercial Banks are key financial institutions that actively support SHGs by providing microcredit, often under priority sector lending norms, and facilitating the SHG-Bank Linkage Programme.
Therefore, only two statements are correct. SHGs are a vital tool for financial inclusion and women’s empowerment in India, making them a recurring topic in UPSC Economy and Social Issues.