1. Meaning and formation: A Self-Help Group (SHG) is a small group, usually of 15-20 members, of poor people - especially women - belonging to one neighbourhood, who meet and save regularly. 2. Regular saving: The saving per member varies from Rs 25 to Rs 100 or more, depending on the ability of the people to save; thus the habit of thrift is created among the rural poor. 3. Internal lending: Members can take small loans from the group itself to meet their needs; the group charges interest on these loans, but this is still less than what the moneylender charges, and the loan is given without collateral. 4. Bank linkage: If the group is regular in savings, it becomes eligible for availing a loan from the bank; the loan is sanctioned in the name of the group and is meant to create self-employment opportunities for the members - e.g. to release mortgaged land, to meet working capital needs, to acquire assets like a sewing machine, handloom, cattle, etc. 5. Solving the collateral problem: SHGs help the poor borrowers overcome the problem of lack of collateral and documents, so they can get timely loans at a reasonable rate of interest and are freed from the clutches of the moneylender and the debt trap. 6. Empowerment of women: Since most members are women, SHGs make them financially self-reliant, give them a say in family and village matters, and build their confidence and decision-making ability. 7. Social platform: The regular meetings provide a platform to discuss and act on a variety of social issues such as health, nutrition, education and domestic violence. Hence SHGs are rightly called the building blocks of the organisation of the rural poor.