Microfinance and Women’s Empowerment through Self-Help Groups: Evidence from Southern Tamil Nadu toward Achieving Sustainable Development Goals

Abstract

Purpose: Microfinance is a widely promoted progressive initiative to provide deprived women with affordable financial services for poverty alleviation. Self-Help Group (SHG) model in India are seen as socially active groups that can facilitate a government’s plans towards achieving the sustainable development goals.  This study explores the impact of microfinance on women’s empowerment by assessing its role in improving financial independence, decision-making power, and social status. It examines key factors such as economic empowerment, increased well- being and social& political empowerment, highlighting the role of microfinance in attaining the six SDG goals.

    Design/Methodology/Approach: A quantitative, cross-sectional approach was employed. Primary data was collected from women beneficiaries of SHG linked with microfinance institutions. The study was conducted across selected districts in southern TamilNadu. Data was collected using a structured questionnaire, the study was assessed using Structural Equation Modelling (SEM) to test   the interconnections between micro finance access, empowerment dimensions and sustainable outcomes.

     Findings: The results suggest that microfinance positively influences women's economic empowerment, also, the factors of increased well- being and the social& political empowerment by enhancing their entrepreneurial activities and participation in household financial decisions. This empowerment of women enables them to raise their living standard and leads to the attainment of SDG goals.

     Policy Implications :      The study emphasizes the need for targeted financial literacy programs, and improved business development services to maximize the benefits of microfinance. Strengthening regulatory frameworks and integrating microfinance with skill development initiatives can further enhance its impact on women’s empowerment.

    Originality/Value: This study contributes empirical evidence on the role of microfinance in women's empowerment, providing insights for policymakers, financial institutions, and development organizations.