CPI-M has demanded the government to reduce the interest rate on loans for self help groups (SHGs) from the current 11-12 percent to a uniform 4 percent.
Brinda Karat (CPI-M), while initiating discussions on women SHGs, said that the prevalent interest rate was very high and the government must subsidise it by making it uniform four per cent.
Karat was against the bill and said that it would be devastating for the country and SHGs would be most affected. She complained that SHGs formed by Muslim women are being discriminated in terms of granting loans.
Shantaram Naik (Cong) said that a portion of the government function would be carried out by SHGs in future as these groups have been quite successful in bringing about a reform in the country. He demanded a law to avoid entry of anti-social elements in the SHGs so that bank's money is also protected.
Pointing out that the rate of recovery of loans by banks is 90 per cent in case of SHGs, Najma Heptulla (BJP) said other sectors default. She noted that SHGs would not be helpful to bring the poor above poverty line unless price rates are reduced.
Kanimozhi (DMK) praised the role of SHGs and said that they boosted confidence level of women, who have become actively involved in community development.