Turkish Journal of Computer and Mathematics Education Vol.12 No.

6 (2021), 5237-5245
Research Article

Impact of Microfinance on women empowerment through Self-Help-Groups in Alwar

District, India

Rejoice Solomona, Dr. Ranu Sharmab

a Research Scholar, School of Management & Commerce, Poornima University Jaipur1
b Associate Professor, School of Management & Commerce, Poornima University Jaipur
[email protected], b [email protected]

Article History: Received: 10 November 2020; Revised 12 January 2021 Accepted: 27 January 2021; Published
online: 5 April 2021
_______________________________________________________________________________________________
Abstract: Empowerments of women become a main motive of the nation. As they are the foundation for the growth, peace and
Equality of the nation.70% of the worlds’ population are of poor women. And they were not considered by any formal or non
formal institution for the credit worthiness but it is microfinance institutions that came forward to avail the facility of loan to
them with the help of Self-Help-group. The motive of this paper is to know the dimensions by which empowerment of women
would be take place through microfinance self-help-group. For the collection of data a survey method was used on the 550
women of Alwar District but for the study only 496 questionnaires was used as the 54 questionnaire was not completely. The
collected data was analysed in SPSS, Factor Analysis, Pearson r and Dependent and independent variables were considered did
to know the impact of microfinance on empowering women by SHGs of Alwar, Rajasthan. The study shows a positive
relationship of in the economical and social empowerment of women with microfinance.
Keywords: Women Empowerment, Self-help-Group, Microfinance, Dimensions

1. Introduction
To build a bridge of financial services to the needy and poorer people of the society Grameen bank was formed
by Mohammed Yunus in the year 1974 when the people of Bangladesh fall into the trap of famine. But it was
acceptable by the government in the year 1983. They used to make small group of 7 to 12 women who have a
same socio-economic background granting them loan without any collateral security and that group is known as
Self-Help-Group. In India reserve Bank of India (RBI) approved in the year 1992. It is also known as Bankers to
the Poor. Now this concept is growing rapidly at present India has 70,000 microfinance institutions and these
institutions are working for the betterment of people who not getting proper food and also for those who are
unable to stand for themselves for the development of nation, microfinance work as a vaccine for women
empowerment. Empowerment of women is mandatory and also the need of a nation but making them
economically strong it is important to empower her psychology. The women of Rajasthan were not allowed to
come outside and also they are not allowed to take their decisions independently, and the most important thing is
they were not allowed to live the life as person. But now the women of Rajasthan need a change and they are also
trying their best to empower themselves it all is happening because of the microfinance institutions. They need a
change and coming forward to break the walls which are coming on their way. Women empowerment and nation
development are linked together without women empowerment a nation can’t be develop. Thus microfinance
institutions are working for the betterment for nation by empowering the weaker, poorer women of the society.
Millennium Development Goal 3 i.e., MDG3 is formed to empower the women of India which leads to the
development of India by the United Nation and they formed to make it achieve by the year 2005 they failed to
achieve their goal later they decided to make it possible by the year 2015 that also failed now by the year 2030
they want to achieve the MDG3. Government also formed many policies and programme for the betterment of
women to make them empower by the microfinance self-help-groups programme.
2. Literature Review
Mehra, et al., 2010 presented an empirical study to analyse role of women empowerment through self help
group. Discussed the income generated activities initiated by SHG’s members and its problems. For the purpose
of study an analytical research survey was conducted through questionnaire among 80 SHG’s members of Indore
district, Madhya Pradesh. The empowerment of women was analysed under 4 parameters they are; resources,
welfare for the family and influence over local political activities. Majority of the respondents said that they were
facing the problem of over burden with responsibilities, high interest rate by banks. Author concluded that SHG’S
are contributing rapidly for the growth of women and also for the Economic. Venkatesh & Kala, 2010 presented
an Descriptive study on women at economical level after joining SHG’S For the purpose of study an analytical
research survey was conducted through questionnaire among 134 SHG’S members from south districts of
Tamilnadu. The data was analysed on the basis of various perspectives like; age, reason for joining SHG’S, before
& after monthly income, amount of loan, repayment of loan. The collected data was analyse by using percentage,

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Research Article

Author concluded that after joining SHG’S there is an improvement among the women, SHG’S’s in south
Tamilnadu worked very well it goes in such the SHG’S’s of Tamilnadu will success. Jain,2012 presented a study
to know the effect of small finace on empowering women of Udaipur district Rajasthan, framed three hypotheses
to analyze the relationship of age, education, period of membership with respect to empowerment of women. An
analytical research survey was conducted through questionnaire among 100 respondents to analyse the effect of
microfinance upon women in 3 areas of empowerment i.e. Economic, Social and political. Authors concluded that
respondents were not able unable to cope up with the financial problem which arises in their family and also
women were politically more empower as compared to economical and social. Indhumathi &Palanivelu, 2013
presented a study on women empowerment through SHG’S by testing three hypotheses that analyses the
relationship of education with training facility, with banker’s attitude and with the income of the members after
joining SHG’S. The study was carried out in 100 SHG’S members of Pollachi block in Coimbatore district,
Tamilnadu, who were interviewed. Author concluded that majority of the respondents were satisfied with their
income, expenditure and employment were increased ant they feel their status has been improved. Author also
suggests that training facility should be provided banks procedure should be minimized, awareness programme
should be conduct. Farooqui, 2013 presented an empirical study to analyse the role of microfinance institution in
promoting and distributing micro insurance product. Framed two hypotheses to analyse the significance role of
microfinance with awareness of micro insurance product and with micro finance institutions. For the purpose of
study an analytical research survey was conducted through questionnaire among 140 respondents of Allahabad,
Uttar Pradesh. It was found the respondents were not much aware regarding the micro insurance product;
microfinance institutions were facing the problem in creating awareness and distributing products because of lack
of illiteracy, modern technology, resources. Author concluded that the role of microfinance institutions in
promoting and distributing micro insurance products were ineffective thus he suggests that microfinance
institutions should laid the foundation of insurance among BPL and companies should launch new innovative and
attractive product. Maurya, 2014 presented a study to know the impact of microfinance on poverty eradication
through SHG’S. Discussed the Socio-Economic impact of microfinance on savings and borrowings pattern among
SHG’S members. Most of the researcher discussed the projects launched by NABARD. For the study both first
hand and second hand information were gathered. An analytical research survey was conducted upon 125 SHG’S
members through interview among four regions i.e. Patti, Kunda, Sandwa and Lalgan of Pratapgard district in
Uttar Pradesh, India. After being a part of the group the savings and income of the respondents were increased and
they started towards non-farm activities, dependencies on moneylenders were reduced and the loan which they
avail was for income generating activities. Author concluded that SHG’S’s not only provided the financial
services but also works better in terms of creating awareness & empowerment. SHG’S played an crucial role for
the betterment of Uttar Pradesh as it improved the Economic conditions, developed Social conditions of people.
3. Research Methodology
First-hand and second-hand information have been used for this study. First hand data have been gathered by a
survey method which was done on the 550 women beneficiaries microfinance SHGs in Alwar but here only 496
questionnaires was used as the 54 questionnaire was not completely. And the second hand information was
collected from journals, books, research papers and reports of microfinance. Descriptive analysis, Reliability Test,
KMO- Bartlett's Test of Sphericity, Factor analysis, Pearson r and Dependent and independent variables were
considered to know the effect of microfinance on empowerment of women by the microfinance self-help-groups
in Alwar District. Where microfinance is kept as independent variable and economic and social empowerment
kept as a dependent variable.
Hypothesis
H01: There is no significant impact of the microfinance on the economical empowerment of women through
Self Help Group.
H02: There is no significant impact of the microfinance on social empowerment of women through Self Help
Group.

Data Analysis
Table 1: Rotated Component Matrix

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Rotated Component Matrixa

1 2

Did microfinance increases the income of your family .660

Did microfinance help you to alleviate the poverty? .791

Did microfinance help you in maintaining bank related work? .717

Did microfinance helps you to take decisions regarding the utilization of

.750
money/credit.

Did microfinance helps you to become economic self-dependence .687

Did microfinance made you capable to support your family at the time of
.773
financial crisies.

Did microfinance enhance the saving of your family? .741

Did microfinance help you to reduce the dependency on money lenders? .650

Did microfinance helps you to open an independent bank account. .710

Did microfinance help you to have ownership on household assets? .733

Did you feel that microfinance helped you to participate in the decision
.572
making in your family?

Did you raise your status in society? .532

Did microfinance helps you to fight against social violence like; dowry,
.584
female feticides.

Did microfinance help you to actively participate in social activities? .539

Did microfinance helps you to express your opinion freely in SHG

.521
meetings

Did microfinance made you to take your own decisions independently. .733

Did microfinance made you capable to mobilize freely. .720

Did microfinance help you to save money? .566

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Did microfinance increase your role in the family? .746

Did microfinance plays a vital role in your upliftment. .665

Do you think that microfinance developed a potential upon you to solve

.692
the problems of other group members.
From the rotated component matrix it was seen that in economic empowerment factor 10 variables were loaded
in one. And under social empowerment factor 11 variables were loaded.
Economic Empowerment
In economic empowerment of women it has 10 variables which show that microfinance improves the
economic status of women. Alleviation of poverty is the variable which has a value of 0.791 followed by
supporting family at the time of financial crisies and ownership on household asset both have 0.773, decision
regarding the utilization of money credit 0.621, followed by saving with 0.740, banking work with 0.717, as for
the self dependency it has 0.687 followed with increase in income with 0.660 and dependency on money lender is
0.650. Thus it can be concluded that microfinance has empowered the women economically and it has also having
a positive impact on empowerment of women.
Social Empowerment
In social empowerment there were 11 variables which shows the empowerment of women by microfinance As
for the social empowerment it was found that the role of women in their family has increased the value come out
is 0.746 followed by the decision making ability with 0.733 followed with mobilize freely with 0.720, solving the
problems of other group members. With 0.692 for upliftment.0.665, 0.584 for fight against social violence
followed by decision making in your family with 0.572, saving with 0.566, participation in social activity with
0.539 followed by status in society with 0.532, expressing their opinion in meeting with 0.521. Thus it was come
to know that microfinance has a positive impact and women were socially empowered.
Table 2: Reliability Analysis

Reliability Statistics
Cronbach's
Variables N of Items
Alpha
Economic Development .900 10

Social Empowerment .897 11

Sources: output of IBM-SPSS 22
Table 2 shows the reliability of data the Cronbach’s alpha value of both the variables are more than 0.7 which
shows the data is reliable.
Testing of Hypothesis
H01: There is no significant impact of the microfinance on the economical empowerment of women through
Self Help Group.
H0A: There is a significant impact of the microfinance on the economical empowerment of women through
Self Help Group.

Correlation Analysis
Correlations

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Economic Empowerment

Pearson Correlation .359

Microfinance Sig. (2-tailed) .000

N 496

Source: Output of IBM-SPSS 22

The above table presents the correlation among the microfinance and the economical empowerment of women
through Self Help Group. Economic empowerment’ carries a positive relationship with the microfinance of
women through SHG. The table shows that there is a significant relationship between microfinance on economic
empowerment of women through Self Help Group. It has found that Pearson correlation value is 0.359 and the sig
value (sig value) is 0.000 which shows a significant positive relationship between microfinance and economic
empowerment of women through Self Help Group.

Scatter Plot
Source: Output of IBM-SPSS 22
Regression Analysis
Model Summary
Model Summaryb

Adjusted R
Model R R Square Std. Error of the Estimate Durbin-Watson
Square

1 .359a .129 .127 .44202 1.872

a. Predictors: (Constant), Microfinance

b. Dependent Variable: Economic Empowerment

Source: Output of IBM-SPSS 22

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The above table shows the model summary; R Square is .129 which indicates microfinance shows 12.9% of
the variability with significant effect on economic empowerment.
The above table indicates the simple linear regression model summary with the overall fit statistics. It indicates
that R value of our model is.359, which indicates the positive correlation between the economic empowerment
and the microfinance. The Durbin-Watson value is indicated with d = 1.872, the correlation is modelled between
data points and can be relied upon.
ANOVA goodness of fit (GOF)
ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 14.263 1 14.263 73.001 .000b

1 Residual 96.519 494 .195

Total 110.782 495

a. Dependent Variable: Economic Empowerment

b. Predictors: (Constant), Microfinance

Source: Output of IBM-SPSS 22

The test goodness of fit tells us whether the model is good enough which is to be getting by the sig. value.
Here it is good as the vale is below .000 which is below .05.
Thus we can say that the model explains the data in a goodness of fit. And there is also a significant proportion
if variance in the economical empowerment of women.
Coefficients
Coefficientsa

Unstandardized Standardized
Coefficients Coefficients
Model t Sig.
B Std. Error Beta

(Constant) 1.624 .050 32.780 .000

1
Microfinance .237 .028 .359 8.544 .000

a. Dependent Variable: economic empowerment

Source: Output of IBM-SPSS 22

An unstandardized coefficient shows the dependency of Dependent variable on independent variable when
keeping the independent variable as constant. And from the analysis we have rejected the Null hypothesis and
accepting the alternate hypothesis.
H02: There is no significant impact of the microfinance on the social empowerment of women through SHGs.
HA2: There is a significant impact of the microfinance on social empowerment of women through SHGs.

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Correlation Analysis

Correlations

Social Empowerment

Pearson Correlation .441

Microfinance Sig. (2-tailed) .000

N 496

Source: Output of IBM-SPSS 22

T know the relationship between microfinance and the empowerment of women at social level Pearson r used
and from the analysis the value of r comes out is 0.441 and the sig. value is .000. it shows a positive relationship
between both. And social empowerment carries a ‘moderate’ positive relationship with the microfinance.

Scatter Plot
Source: Output of IBM-SPSS 22
Regression Analysis
Model Summaryb

Std. Error of the

Model R R Square Adjusted R Square Durbin-Watson
Estimate

1 .441a .194 .193 .42509 1.824

a. Predictors: (Constant), Microfinance

b. Dependent Variable: Social Empowerment

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Source: Output of IBM-SPSS 22

Table shows the model summary; R Square is .194which indicates microfinance shows 19.4% variable having
an significant impact on social empowerment. Table also shows the Simple linear regression model which shows
the value of R with .441 thus, a positive correlation between the social empowerment and the microfinance. The
value of Durbin-Watson is 1.824; therefore there is no auto correlation with the data.
Table: 4.4.2.3 ANOVA goodness of fit (GOF)
ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 21.517 1 21.517 119.079 .000b

1 Residual 89.265 494 .181

Total 110.782 495

a. Dependent Variable: Social Empowerment

b. Predictors: (Constant), Microfinance

Source: Output of IBM-SPSS 22

The test goodness of fit tells us whether the model is good enough which is to be getting by the sig. value.
Here it is good as the vale is below .000 which is below .05. Thus we can say that the model explains the data in a
goodness of fit. And there is also a significant proportion if variance in the economical empowerment of women.
Coefficients
Coefficientsa

Unstandardized Coefficients Standardized Coefficients

Model t Sig.
B Std. Error Beta

(Constant) 1.222 .075 16.319 .000

1
Microfinance .420 .038 .441 10.912 .000

a. Dependent Variable: Microfinance

Source: Output of IBM-SPSS 22

An Unstandardized coefficient shows the dependency of Dependent variable on independent variable when
keeping the independent variable as constant. And from the analysis we have rejected the Null hypothesis and
accepting the alternate hypothesis
4. Conclusion
Women empowerment is need of a need of a nation’s development. This study was done to know the effect of
microfinance on women empowerment through SHGs. Where social and economical variable were kept as a
dependent variable upon microfinance and the result shows a positive correlation between both the factors. Both
the null hypotheses were rejected as the value is less than 0.05 therefore accepting the alternate hypothesis i.e.,
there is a significant impact of microfinance on economical and social empowerment of women through self-help-
groups. In order to analysis the hypotheses correlation and regression analysis done which shows a positive
correlation between economical and social empowerment of women with microfinance.
With the help of microfinance women become self independent, solving their problem independently, their
income has also increased they used to go out without any fear..

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