Patna: In a landmark decision aimed at bolstering the economic empowerment of women, the Bihar government, under Chief Minister Nitish Kumar, has approved the establishment of a dedicated bank for the state’s Jeevika self-help group (SHG) members. Christened ‘Jeevika Nidhi’, this initiative promises to streamline financial transactions and pave the way for greater self-reliance among women entrepreneurs in the state.
Following the cabinet’s nod to the proposal on Friday, the Rural Development Department Secretary, Lokesh Kumar Singh, on Monday issued a formal resolution outlining the formation of the unique financial institution.
“My Bank – My Power”: Jeevika Nidhi Takes Shape
The newly formed Bihar State Jeevika Nidhi Credit Cooperative Union Limited will operate as the dedicated bank for the women of the Jeevika network. Registration under the Bihar Cooperative Society Act, 1935, will enable Jeevika Didis to access affordable loans with ease, empowering them to strengthen their existing small businesses and venture into new economic activities. The operations of Jeevika Nidhi will be exclusively for the benefit of the Jeevika members.
State-Level Initiative to Meet Livelihood Needs
Conceptualized at the state level, this special credit cooperative institution is designed to address the financial needs for livelihood promotion activities of a significant number of families associated with community-based institutions. The primary objective is to provide capital loans to SHG members at an annual interest rate of 12 percent. The union’s management committee will have the flexibility to adjust interest rates in the future based on evolving needs. This initiative is expected to significantly reduce the reliance of women on high-interest loans from local moneylenders and microfinance companies, while also overcoming delays often encountered in securing loans from traditional banks.
Run By Women, For Women: Strengthening Empowerment
Notably, Jeevika Nidhi will be managed entirely by women members, further solidifying women’s empowerment within the state. The institution will facilitate access to a range of essential financial services in rural areas, including savings, loans, and insurance. This is anticipated to ease the flow of credit among women and decrease their dependence on microfinance institutions. Loan products will be tailored to the specific business needs of the members, and the demand for larger loan amounts will be addressed promptly. Furthermore, the establishment of Jeevika Nidhi is expected to mitigate risks associated with community funds.
Significant Investment Backs Ambitious Project
A substantial investment of Rs1,000 crore has been earmarked for the establishment and smooth operation of the Bihar State Jeevika Nidhi Credit Cooperative Union Limited. This includes a direct grant of Rs500 crore from the Bihar government and Rs400 crore to be collected from primary committees as share capital. Additionally, the state government will provide a separate grant of Rs100 crore to develop a robust information technology-based system for the bank’s operations. The National Rural Livelihood Mission (NRLM) will also contribute Rs110 crore to this significant initiative. Furthermore, the Bihar government will act as the guarantor for any loans taken by Jeevika Nidhi from financial institutions such as banks, NABARD, LIC, National Cooperative Development Corporation, and the Small Industries Development Bank of India. The Bihar State Jeevika Nidhi Credit Cooperative Union Limited will be governed by the rules and regulations stipulated under the Bihar Cooperative Societies Act, 1935. Its governance structure will comprise a general body, representative general body, management committee, and designated office bearers. This historic step is poised to usher in a new era of financial autonomy and empowerment for the women of Bihar’s Jeevika movement.
