Community Operational Manual
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Odisha Livelihoods Mission
Panchayati Raj Department, Govt. of Odisha, Bhubaneswar
SIRD Campus, Unit – VIII
Bhubaneswar – 751 012
Tel.Phone No – 0674 2560166/126
Email :- smmu.olm@gmail.com
Community Operational Manual
Non-negotiable of OLM
We will not compromise on the “guiding principles” of the project.
Transparency:
We will ensure that all the information, financial & procurement transactions, implementation
process to be open and accessible to all.
Participation:
We will plan, implement and monitor all project related activities involving all the direct
stakeholders through a participatory process.
Inclusion:
We will ensure that the extremely poor, vulnerable and destitute are correctly identified and benefit
from the project.
Accountability:
We will ensure that as project stakeholders, we will discharge our agreed responsibilities and own
our decisions collectively.
Equity:
We will ensure that women will be the primary participants in the project as leaders, implementers
and beneficiaries.
Facilitation:
We will ensure that project will be implemented in such manner that the community be the frontrunners in ensuring project quality and sustainability.
Belief in the Community:
We will ensure that there shall be faith in the capability of the poor to undertake, decide and control
the activities of the project.
Integrity:
We will ensure that our funds will be utilized cost effectively and with integrity.
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Community Operational Manual
Why this manual?
This manual, ‘Gosthi Sahayika Pustika’ details out in a simple manner various elements of OLM
project. It hopes to facilitate greater participation from community members by explaining the
project components to them and clarifying their role in the project. The principles of the project,
guide the community to do the right work at the right time for increasing their efficiency. The
manual is in tune with the guiding principles of Targeted Rural Initiatives for Poverty Termination
and Infrastructure (TRIPTI) and Mission Shakti which enables the women to be self-reliant and
empower them to take decisions for the betterment of their families and society at large.
More specifically, Gosthi Sahayika Pustika will:

Explain the guiding principles of OLM

Outline the roles and responsibilities that the community members are supposed to play in
OLM project.

Illustrate how the community will plan, implement and monitor OLM project component at
their level.
Who will use this manual?
The community members are considered as the primary target of this manual. This manual will be
a ready reckoner for the project team as well, especially those who will be in direct contact with the
target group, such as SHGs and their federations, producer groups and others who are not in the
mainstream of SHG fold and other inclusions plan. The basic principles of the execution of the
project components will be well understood and implemented by the community more specifically
by the primary stakeholders.
What is OLM?
OLM is the acronym for “Odisha Livelihoods Mission”. OLM is a registered society working
under the Panchayati Raj Dept. of Govt. of Odisha for enhancing the socio-economic condition of
the rural poor through promotion of sustainable livelihoods. The society is implementing the
centrally sponsored scheme of Govt. of India called “National Rural Livelihoods Mission” (NRLM).
The project’s aim is to enhance social and economic status of the rural poor of all the blocks of 30
districts of Odisha through development of self-sustained and community managed institutions.
The targeted poor households are mobilized into thrift and credit based Self Help Groups (SHGs)
which are in turn federated into higher level institutions at cluster, GP and block level.
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Experience of TRIPTI and Mission Shakti:
TRIPTI is an externally funded project working for the social, financial and economic empowerment
of the women in the 10 costal districts of the State. TRIPTI focuses mostly on institutional building
and the promotion of livelihood of the community with the participation of all types of stake holders
from Government and non government agencies.
Mission Shakti is the pioneer in the state for the formation and strengthening of women SHGs
since more than a decade. It is otherwise called as the power of the poor women. Mission Shakti
aims at socio-economic empowerment of women so that they can contribute substantially for the
better livelihood options of their families. OLM will follow the footprints of TRIPTI and Mission
Shakti and use the base developed by TRIPTI in 38 blocks of 10 costal districts and by Mission
Shakti in all the blocks of Odisha.
OLM will aim at building sustainable institutions at community level i.e. Self-Help Groups (SHGs),
Cluster Level Forums (CLFs), Gram Panchayat Level Federation (GPLF), Block Level Federation,
producer groups and enhancing livelihood options of poor women. In this context, OLM will work
taking into consideration the need of the community. SHGs, CLFs and its federations will plan,
implement and monitor the activities at the community level. The community will take the decisions
for successful implementation of the project. The project team will only act as facilitators in the
whole process.
Key features of OLM

OLM aims at women’s empowerment through development of self sustainable institutions of
women.

SHGs (Self-help groups) and their federations at the panchayat and block levels are strategic
components of OLM’s implementation.

OLM will play a catalytic role for leveraging funds from banks and other financial institutions.

OLM will focus on sustainable livelihood promotion of the poor households through Producers
Group (PG) and its higher level federation.
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What are the institutional arrangements of the project at different levels?
State Mission
Management Unit
(SMMU)
District Mission
Management Unit
(DMMU)
Block Mission
Management
Unit (BMMU)
What is the role and responsibilities of the project institutions at different levels in the
project?
The role and responsibilities of the project institutions at different levels in the project has been
provided in the following table:
State Mission 
Recruiting project team at the state level, district & block level
Management

Induction and training of all project staff and key stake holders
Unit

Developing and issuing service standards, guidelines for various component
implementation, appraisal checklist and monitoring indicators

Developing strategy and action plan for strategic communications and
institution building

Preparing and financing annual work plans and budgets, financial
management and state-level auditing

Monitoring, Evaluation and Learning from project implementation and
knowledge management activities

Coordinating activities at district, block, cluster and village levels

Converging with other government programs and developing partnership
support
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District

Mission
Management
Prepare annual work plan of project activities and ensure timely
accomplishment of the same

Unit
Ensure operationalization of all financial, administrative and HRD guidelines
at the district level

Conduct periodic reviews of project progress and report to SMMU and inform
the District Administration as and when required

Conduct capacity building programs as well as other related activities for
district, block level staff and other key stake holders

Establish strong linkages with district Government offices, line development
departments, district resource agencies, private sector players, bankers and
eminent public representatives for garnering required support for the project

Monitor and supervise Community Investment Funds routed to poor through
GPLF or BLF or by the Block unit

Document project learning and disseminating the same to all relevant levels
as well district administration

Extend handholding and ensure technical support to BMMU as and when
required

Identification and promotion of producer organization based on value chain
analysis
Block Mission 
Organize target community into SHGs and then federating them at the GP
Management
and Block level
Unit

Build capacity of SHGs and village organizations

Identification and promotion of producer organizations based on value chain
analysis

Constitute the apex structure of the Community based Institutions at the
Block and Panchayat level viz. BLF and GPLF ensuring functioning of the
same through handholding and regular capacity building inputs

Manage the interface between banking system and community groups
through membership in BLF and liaisoning with banks

Help community based institution in preparing livelihood sub projects (value
chain proposals), getting their approval from DMMU/SMMU and ensure their
qualitative implementation.

Support community based institutions in developing linkages with financial
institutions, service provider agencies and line development departments

Facilitate community based institutions to develop forward and backward
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linkages

Conduct regular interface of BMMU and BLF with Block Government officials
and Panchayat representatives and garner support from them

Manage and monitor channeling of CIF to GPLFs and rotation of the same
amongst the member SHGs

Furnish information through MIS and submitting progress report to DMMU

Guide the CP and review their performance as per the need of the
community institutions and the project

Organise regular capacity building activities for the CP and the community
service provider like the Community Resource Person, Master Bookkeeper,
etc. as per the requirement of the community.
Role of PRI

The existing functional SHGs will be federated into higher level
federations i.e. Cluster Level Forum at the village level and Gram
Panchayat Level Federation at the GP level.

Once the institutional structure is in place, the institution will conduct the
participatory identification of poor through Situational Analysis with
facilitation of the Situational Analysis (SA) team which includes at least
one PRI members in each SA team & it shall be approved by the Gram
Shaba subsequently.

The word members will be patron of CLF. He she will be a liknk persion
between the CLF & GP. She/he will monitor the activities of CLF to
facilitate convergence and ensure transparency through sub committees
of CLF.

The Sarpanch will be patron of GPLF. He /she will be a link person
between the GPLF and GP. He/she will monitor the activities of GPLF to
facilitate convergence and ensure transparency through sub committees
of GPLF.

PRI representatives will help the women SHGs members and federation
office bearers to buildup their capacity for functioning of PRI.

PRI will invite women SHG members in more numbers & facilitated for
their participation in their Gramsabha

PRI representatives will seek greater involvement & participation in
Implementation of centrally Sponsored Schemes (especially MGNREGS &
State Sponsored schemes in partnership with CBOs.
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
PRI representatives will involve SHG members in preparing of Micro
Planning in villages and demand articulation.

PRI representatives will participate in the village/GP/Block level meetings
of NRLM.

Gram Panchayat Level Federation (GPLF) will seek involvement of PRI for
PRI & CBO convergence pilot Project greater convergence plan. In the
state pilot project will be implemented in Jajpur, Gajapati, Malkangiri &
Sundergarh Districts. After the pilot, the CBO-PRI convergence will be upscaled to other Districts.
What the community based organizations at different levels OLM will work with?
OLM will work with the following community based organizations:
Member
Member
Member
Self Help
Group
Cluster
level forum
Gram Panchayat
Level Federation
Block Level
Federation
Village level
Village level
GP level
Block level
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Formation and the roles and responsibilities of Federations at different levels under OLM:
Self-Help Group at Village Level:
Self-Help Group (SHG) is a small homogenous group consisting of 10-20 members with similar
socio-economic conditions living in the same village or neighbourhood, coming together on a self
selection basis for sharing their common concerns, pool their own resources (both financial and
non financial) and work together for their personal ,social, economic and political development.
There may be more than one group in a village but they will be functioning independently. At least
one female person from a household will represent to one SHG.
Cluster-level Forum (CLF):
Definition- A Cluster Level Forum (CLF) is a platform for sharing of experiences of SHGs and
extends mutual support to improve the overall performance. The CLF will create voice and space
for the poor in the village and help initiate development intervention for poverty reduction. It acts as
a bridge between the SHG and the GPLF.
Structure- The structure of CLF would be:
Activities:
 Formation and strengthening SHGs
 Facilitating capacity building of SHG
members
 Review & monitoring SHG performance
 Review of CRPs
 Planning, appraising and recommending
PPIF & MIP for SHGs
 Follow up & ensure utilization of PPIF
& CISF by SHGs
 Addressing issues based on resolution
 Bridge gap between SHG & GPLF
 Facilitate SA process
Meeting: at least monthly once
Office Bearer:
President, Secretary, Treasurer,
Vice-president, & Joint Secretary
Subcommittee:
 Social inclusion
 SHG performance
monitoring
CLF
(5-15 SHGs)
Leadership rotation: As per tenure
(Preferably in every two year)
Representatives from each SHG will meet together and initiate a CLF
SHG
SHG
SHG
SHG
SHG
SIZE: CLF will be formed at village level with 5-15 SHGs as members. The villages having more
than fifteen SHGs will have more than one CLF.

Case 1: More than 3 SHGs but less than 5 number of SHGs in the revenue village
(minimum 3 SHGs in the revenue village):
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If there are less than 5 numbers of SHGs in the revenue village i.e. 3 to 4 SHG, then CLF will
be formed taking 3 member representations from each SHG.

Case 2: Less than 3 SHGs in the revenue village:
No CLF will be formed for that revenue village. SHGs of that village will be linked to the
neighboring CLF. The neighboring CRP-CM will do the facilitation in that revenue village.

Case 3: More than fifteen SHGs in the revenue village:
If more than 15 SHGs exist in the revenue village, then two CLFs may be formed. If CLF EC
does not agree to split the CLF into 2, then the CLF may be kept intact considering village
affinity, geographical and cultural scenario, and be allowed to nurture more than 15 SHGs.
Membership: Any SHG having a proof of existence by the following documents like Saving Bank
a/c or SHG Resolution Book or SHG transaction register or any other form and interested further to
function as an SHG.
Representation at CLF: The member SHGs will nominate their members to represent them at the
CLF.
a. Two representatives from each SHG, one leader and one general member who are Poor or
Vulnerable (EPVG in OLM) will be nominated by each SHG to the CLF.
b. In Scheduled area, both the representatives from the SHG must be tribal. Hence the Office
Bearer of the CLF in scheduled area will be exclusively tribal. In case of non tribal member
SHG, representative may be nominated following the non scheduled area principles.
c. In non-scheduled area, out of the two representatives, one must be a leader and the other
must be poor or vulnerable.
N.B.: If Situational Analysis (SA)/ Participatory of Identification of Poor (PIP) process has been
completed, member representation will be ensured following the above criteria. If SA/PIP process
not done, Poor & Vulnerable will be selected based on compulsory inclusion1 & auto exclusion
criteria2. Where, SA/PIP process completed after formation of CLF, restructuring of CLF will be
done following the CLF leadership rotation tenure.

Governance: All representatives nominated by member SHGs will together constitute an
executive committee of CLF. This executive committee will elect/select five office bearers
1
Compulsory Inclusion criteria: PVTG (Particularly Vulnerable Tribal Group), Scheduled Tribe, Scheduled Caste, NREGA Job Card Holder- minimum 75
number of days of work, Mo Kudia beneficiary, Rehabilitated or displaced colonies, Manual Scavenger, Female headed household with no adult male member
between 16-59, Seasonal migrant, FRA beneficiaries, Household with only one room with Kacha Wall and Kacha roof, Persons with differently abled/Physically
challenged, Household with no homestead land, Legally released bonded labourer, Destitute/Homeless/living on alms, Sharecropper
2
Auto Exclusion Criteria: Households owing motorized two/ three/ Four Wheelers/ Fishing boats, household owing mechanized Three/Four wheeler, agricultural
equipment such as tractor harvesters etc., Household with any member of Government employee (gazette, non-gazette, Central Government, Government-aided, State
Government, Public Sector Undertakings, Autonomous bodies and local bodies) , Household with any member in family earning more than Rs.10, 000/- per month. ,
Household paying income tax or professional tax., Household owing 2.5 acres or more irrigated land.
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from among its member’s i.e.
President, Vice-President, Secretary, joint secretary, and
treasurer. Out of these five office bearers two must be poor or vulnerable category based on
the auto inclusion criteria. Again at least one from among president, secretary or treasurer
should be chosen from poor or vulnerable category.
In case of scheduled area, all the five office bearers must be tribal only. Out of which, 2 must
belong to poor or vulnerable category based on the auto-inclusion criteria.
President shall be responsible to (i) convene every CLF meeting and facilitate agenda setting
(ii) chair the meetings and facilitate discussions by engaging all members (iii) oversee
implementation of CLF activities by sub-committees (iv) coordinate with Secretary and
Treasurer to achieve group objectives (v) represent the group in higher level organization (vi)
support in conflict resolution efforts.
Vice- president shall assist the president in all activities of president and act as president
when she will absent.
Secretary shall be responsible to i) ensure attendance and participation of members (ii)
responsible for recording minutes of discussions (iii) ensure that the CLF norms and decisions
are implemented (v) report on the progress of sub-committees (vi) facilitate linkage with local
agencies.
Joint secretary shall assist the secretary‘s all activities and act as secretary when secretary
will absent.
Treasurer shall be responsible to (i) safeguarding and accounting for all funds received by the
CLF (on behalf of GPLF) (ii) Maintaining all books of accounts.
Sub committees: Considering the purpose and role of CLF, initially two committees will be
executed and by and when the CLF may create more sub committees for effective operation
of the CLF. The following two sub-committees are:
A. Social Inclusion Committee: The members of CLF will initially form a sub- committee for
pro-poor inclusion and facilitate this as per the guideline. The subcommittee will comprise
maximum of any three members, out of which one member must be from poor or
vulnerable category based on auto-inclusion criteria. In scheduled area, all the three
members must be tribal. Out of the three members, one must be from poor or vulnerable
category based on the auto-inclusion criteria. One of the members of this sub-committee
shall be selected unanimously as leader by rest of the members. It’s preferred to one of
the office bearer should lead the subcommittee for smooth functioning of the CLF.
The basic role of the committee are to (i) organize poor and EPVG category into SHGs (ii)
identify SHGs for eligible to get PPIF (iii) appraise the eligible SHGs to access the propoor inclusion fund and CIF (iv) facilitate bank linkages. (v) Facilitate in ensuring
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entitlement and other social security benefits to members in the village (vi) Facilitate in
ensuring access to basic amenities like health, sanitation, education for its members (vi)
Facilitate in ensuring food security for its members in the village
B. SHG monitoring Committee: The CLF will also initiate with SHG monitoring committee to
monitor the performance of the member SHGs. The subcommittee will comprise maximum
of any three members, out of which one member must be from poor or vulnerable category
based on auto-inclusion criteria. In scheduled area, all the three members must be tribal.
Out of the three members, one must be from poor or vulnerable category based on the
auto-inclusion criteria. It’s purposefully suggested that the treasurer or office bearer should
lead the committee to take forward the CLF functioning.
The basic role of the committee is to (i) monitor the SHGs in line with ensuring
Panchasutra for effective operation of the SHGs (ii) regularly review the SHG activities (iii)
engaging in frequent field visit to ensure the regular book keeping (iv) follow up PPIF
utilization.

Representation at GPLF: The CLF will be represented at GPLF by three of its office bearers
from the executive committee, out of which at least one representative shall be from poor/
EPVG /tribal category.
a. In Scheduled area, the three representatives from CLF must be tribal. Out of these 3 tribal,
one must be poor or vulnerable based on the auto-inclusion criteria.
b. In Non-Scheduled area, out of the three representatives, one must be poor or vulnerable
based on the auto-inclusion criteria
Gram Panchayat Level Federation (GPLF) at Gram Panchayat level:
All the SHGs of a GP irrespective of the Self-Help Promoting Institutions are federated into
a GPLF through the CLF of their respective revenue village. In case where a GPLF exist (formed
by Mission Shakti), the GPLF will be restructured based on the representation of SHG Members to
CLFs and from CLFs to GPLF. The process of restructuring will be initiated only after the CLF has
formed in all the revenue villages of the concerned GP. The GPLF helps the community to put forth
their demands in the Pallisabhas and Gramsabhas for the development of their respective villages.
But it is usually preferred to form federation for accessing the entitlements available at panchayat
level.
GPLF will be formed including all the SHGs from every village of the concerned Gram Panchayat
through the CLFs.
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Process of Formation:
GPLF will be formed including all the SHGs from every revenue village of the concerned Gram
Panchayat through the CLFs. A CLF consist of 5-15 SHGs (for details about CLF formation, refer
CLF’s guideline) of a revenue village.
Formation of General Body (GB):
The General Body of GPLF will be formed with all the members of SHGs who have become the
member of the GPLF.
Representative General Body (RGB):
The CLF EC is the representative general body of the GPLF. The CLF EC comprises of 2
members nominated from each SHG: one leader and the other poor or vulnerable from amongst
the members.
Formation of Executive Committee (EC):
The executive Committee will be nominated by CLF. Each CLF shall nominate three member from
their office bearers as executive committee members of GPLF, out of which at least one
representative shall be from poor or vulnerable (based on the auto-inclusion criteria) in nonscheduled area and in scheduled area all the 3 must be tribal and at least one amongst the three
must be poor or vulnerable based on the auto-inclusion criteria.
Case 1: Less than 3 CLFs in the GPLF
If there are less than 3 CLFs in the GPLF, then all the office bearers of the CLF will be
nominated to form GPLF EC. Apart from the office bearers, any one CLF may nominate
additional member (poor or vulnerable based on the auto-inclusion criteria) from the CLF
EC to the GPLF. To nominate the additional member, the two CLF shall organize a joint
CLF EC meeting in which it shall be jointly decided on the additional member to be
nominated. Thus at any point of time, it has to be ensured that the GPLF EC shall consist
of not less than 11 members.
Case 2: 3 to 5 CLFs in the GPLF:
If there are 3 to 5 CLFs in the GPLF, then three members shall be nominated from their
office bearers as executive committee members of GPLF, out of which at least one
representative shall be from poor or vulnerable (based on the auto-inclusion criteria) in nonscheduled area and in scheduled area all the 3 must be tribal and at least one amongst the
three must be poor or vulnerable based on the auto-inclusion criteria. If there is 3 CLFs,
one additional member from office bearer of each CLF will be nominated to form GPLF EC.
**The number of CLF is as on date. In future if the number of CLFs increase to more than 5
then the nomination may be changed as per the operational manual and bye law.
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Case 3: More than 5 CLFs in the GPLF:
If there are more than 5 CLFs in the GPLF, then two members shall be nominated from
their office bearers as executive committee members of GPLF, out of which at least one
representative shall be from the poor or vulnerable category (based on the auto-inclusion
criteria) in non-scheduled area and in scheduled area both must be tribal and at least one
amongst the two must be poor or vulnerable based on the auto-inclusion criteria.
**** In case of equal number of votes during decision making then final decision will be
taken by draw system (chit system).
The President, Secretary and Treasurer who are the office bearers of the GPLF are also members
of the Executive Committee.
Roles and Responsibilities of GPLF:

Identify and mobilize all eligible women into SHGs through motivation and support to
Cluster Level Forums (CLFs).

Disseminate information to SHGs on a variety of topics to strengthen the activities of the
SHGs.

Prepare a Capacity Building Plan for Member SHGs and facilitate its implementation.

Arrange for grading, credit rating and credit linkages.

Provide accounting and auditing services to SHGs.

Provide loans to SHGs for further on-lending to their members.

Resolve conflicts among and between SHGs.

Provide or facilitate support services to help members enhance their income generating
activities.

Liaise with Government agencies and other service providers such as banks, insurance
companies and business advisory services.

Any other role which will enhance the quality of life of member SHGs

Tie up arrangement with central & state Govt. to help SHG participate in exhibition, fairs &
mela.
For details on the formation and operation of GPLFs, please refer “GPLF Operational Manual”.
Block Level Federation (BLF) at block level:
Block level Federation will be formed with all the members of the GPLFs existing within the Block.
The Executive Committee comprising of 11 members including the President, Vice-President,
Secretary and Treasure nominated by the General Body of the BLF.
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Role and Responsibility of BLF:

Fostering good relationship among the member GPLFs

Preparing Business Development Plans for providing financial and non-financial services to
all the SHGs who are members of the BLF

Organizing capacity building programmes and exposure visits for all member GPLFs

Networking with government and non-government organizations.

Analyzing different block level social issues and take suitable measures to solve the same.

Taking initiative to cover all the members of SHGs under different insurance schemes.
Coordinating with different insurance companies for providing appropriate insurance
scheme to members of the SHGs as per their necessity and renewing the same on time.

Ensuring the involvement of SHGs in different Govt. programme like civil supply, sanitation,
health etc.

Organizing monthly/quarterly/half yearly/yearly meeting regularly for planning get and
reviewing the progress regularly.

Provisioning innovative services for members, ratifying the same in the GB and
implementing the same for the development of the members.

Collecting membership fees from each GPLF and providing them pass books and a copy of
the bye law of the BLF.

When a member defaults in repayment of loan than conflict arises in a group. GPLF takes
initiative to solve these issues. If the GPLF fails to resolve these issues, BLF takes the
initiative to solve them.

Compiling the monthly progress reports of member GPLFs and submitting the same to
District Level Federation on the due date.
How will OLM start working in Village?
The project will start working with primary level institutions i.e. SHGs. It will form Cluster Level
Forum and Gram Panchayat Level Federation (GPLF) with the existing functional SHGs.
What is Situational Analysis?
Situational Analysis is a participatory identification of poor. Through this process, all the
households in the village can be categorized into four well being categories: Well-Off, Manageable,
Poor and Extremely Poor & Vulnerable Group (EPVG).
When will be Situational Analysis be conducted?
Situational Analysis will be conducted by Community Institutions themselves with CLF taking lead
and supported and monitored by the GPLF. This shall be ably supported by the CRP-CM and any
other social capital attached to the GPLF.
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What is the necessity of Situational Analysis?
It is well known that the best way to identify poor is by the participatory mechanism. Situational
Analysis is based on the same concept where the community has the freedom to decide who is
poor amongst them. Inclusion into the SHG fold based on data from SA will help to eliminate the
error of leaving out any deserving HH.
What is the advantage of Situational Analysis?
Situational analysis will help in identifying the left out HHs and bring them into the SHG fold. It will
also help in ensuring the participation of the poor and EPVG at each institutional level-SHG, CLF,
GPLF.
What are the different situations of the GPLF?
The GPLFs are majorly in the following three situations:
1. Functional GPLF
2. Non-functional GPLF
3. Non-existing GPLF
[Indicators for assessing the status of the GPLF have been provided in Annexure –II]
What is a functional GPLF?
The GPLF fulfilling the following criteria can be called a functional federation:
 At least 75% functioning SHGs in the GP are members of the GPLF
 The member SHGs have become members either by paying one time membership
fees or regular subscription as per the bye-laws of the federation
 GPLF has an account in the nearest bank.
 Books of accounts are updated on monthly basis.
 At least 90% of Executive Committee (EC) meetings have been held as stipulated in the
bye-laws of the federation.
 GB (General Body) meeting has been held in the last financial year, as stipulated in the
bye-laws of the federation, with minimum 60% participation by primary GB members.
What is a non-functional GPLF?
The GPLF which has been formed but not functioning properly e.g. the Executive Committee is not
aware of its roles and responsibilities, there is no utilization of the funds etc. is called a nonfunctional federation.
What will OLM do for a non-functional GPLF?
The Cluster level forum will be formed with representation from all the existing functional SHGs at
the revenue village level. The existing non-functional GPLF will be restructured by representation
from the CLF members. The focus will be on strengthening of SHGs, CLFs and GPLF. To provide
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proper handholding support to these community institutions, CRP-CM will be placed at the CLF
level, MBK and CP will be placed at the GPLF level.
They will help in streamlining of the group processes. They will also impart need based trainings
on group management, leadership development, book-keeping and federation management and
organize exposure visits for them.
These capacity building processes will gradually help in
strengthening the federation.
What OLM will do where there is no Federation?
Where there is no federation, the BMMU will train the SHGs about the need and management of
the federation. By providing federation management training, organizing exposure visits and
guiding them regularly, the process of GPLF formation will start.
Where there is no federation, the BMMU will form CLF at the village and then form GPLF.
What will OLM do if the GPLF is functional?
If the federation is functional, CLF will be formed and OLM will release the start-up fund.
What is the need of start-up fund?
In the present scenario the GPLF has no office to function. They are organizing meeting either in
the residence of the President & the Secretary or in the community hall of the village. As there is
no office, the Executive Committee is not able to work properly. There is no place for keeping the
furnitures, records and other assets of the federation. In fact without an office, the GPLF has no
identity of its own. Therefore for the effective management and regular functioning of GPLF, there
is a need for start-up fund. This start-up fund will be utilized for renting an office space, fixtures and
furniture of GPLF, etc. In addition to this start up fund is also needed for spreading awareness
about ‘OLM’.
Why start-up fund will be given?
1.
2
2.
3
4
5
Purpose
Furniture for GPLF (Table, chair,
Almari, Poly thene, Transparency
board, Water Filter etc)
Stationary (Books, Marker, Pen,
etc.)
House rent and day to day
expenses of GPLF
First year
Second year
Third Year
Computer
Internet
First year
Second year
Third Year
Contingency
Unit Cost (Rs)
Amount (Rs)
Rs. 20,000/-
Rs 5000/-
Rs. 12,000/Rs. 12,000/Rs. 12,000/-
Rs. 36,000/Rs 50,000/Rs 18,000/-
Rs 6000/Rs 6000/Rs 6000/5% of the total fund
Total
6450/Rs. 1,35,450/-
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For details on the procurement process of furniture, please refer “Community Procurement
Manual”.
Why is the fund meant for house rent and day to day expenses diminishing after three
years?
OLM aims to strengthen the GPLF so that it can work without any external support. The GPLF will
be strengthened and gradually it will meet its expenses from its own funds. When a child is born,
the mother carries the child in her lap. Then the child crawls, tries to stand and then walks without
help of others. The mother supports the child till the child is unable to walk without external
support. After 3 years, the federation is expected to be able to meet its entire expenses.
Start-up fund will be given in how many tranches?
Start-up fund will be released in one tranche.
How much money will be given as Start up fund?
100% of the total start-up fund i.e. Rs. 1,35,450/- will be released.
What will the GPLF do to get the Start up fund?

MOU will be signed between GPLF and BMMU(A copy of the MOU is attached in the”
Utilization Certificate Booklet”).

A resolution in this regard has to be approved by the Executive Committee.

GPLF should have a Bank Account.
Who will be responsible for purchase of furniture using the start-up fund?
Procurement Committee will be responsible for purchase of furniture by using the start-up fund.
How the Procurement Committee will be formed and what are its responsibilities?
The Procurement & Purchase committee will be formed taking 5 members out of which 3 members
from RGB & two members from EC and one must be from Poor and EPVG category. In case of
Scheduled area, all the members of the Sub Committee shall be tribal and one amongst them must
belong to the Poor and EPVG category. RGB will nominate the EC and RGB members to the
Procurement & Purchase Committee, subsequently approved by the GB.
Responsibility
1. Preparing annual procurement plans and submitting the same to the Executive Committee
for approval and take validation of GPLF GB/RGB.
2. Taking responsibility for implementation of procurement plans and ensuring compliances
with agreed procurement procedures.
3. Ensuring that the display board provided updated information on all procurement decisions.
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4. Ensuring that all member SHGs are aware about procurement procedures.
5. Reporting to GB/RGB during the GB/RGB meeting on Procurement & Purchase made
during the year, issues arising during procurement and process undertaken to resolve
these issues.
After utilization of the start-up fund, what will be the next activity of the GPLF?
After utilization of the start-up fund, the GPLF will prepare an institution building plan for
strengthening itself and member SHGs?
What is the need for Institution Building (IB) Plan?
The Institution Building Plan is needed for the following reasons:
It has been observed that there is a great need for imparting need specific training to SHGs
and its federations at different levels. SHG leaders are generally trained in the block level.
Hence, the SHG members residing in the village do not get trained at all. Moreover same
trainings are imparted to everyone irrespective of their different capacity building needs.
This creates a gap between the need of the SHG and the training they get. So, if the
federation can identify its need as well as the need of the SHG and impart training
accordingly, then both the SHG and federation can be benefited and capacitated.

It is observed that women from poor households especially the EPVG families are yet to be
included in the SHG. Women empowerment is not possible without inclusion of these leftout women into groups. They have a greater need for joining in groups as this would help
them to become self-sufficient. As the GPLF is an organization promoting women
empowerment, it is the responsibility of the GPLF to include these left-out poor women into
groups.

Leadership development is essential for sustainable development. Different services are
required for functioning of GPLFs. Therefore, Community Resource Persons (CRPs)
should be identified and trained properly to provide these services to the SHGs.

OLM will provide revolving fund to each GPLF. Training is required for effective
management of the fund.
What are the elements which Institution Building Plan will give importance on?
Institution Building plan will give importance on:
 Planning, imparting training programmes and organizing exposure visits as per the capacity
need assessment done during situational analysis.
 Inclusion of left-out HHs into SHG groups
 Identification and training of the Community Resource Persons.
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 Exposure visit to develop clarity of members on MIP process
 Capacity building of the Executive Committee, Sub-Committees of GPLF & SHGs on
preparation of Micro Investment Plans (MIPs).
 Training on prioritization of loans at SHG level during MIP process
 Training on gradation of groups
Who is Community Resource Person?
The Community Resource Persons shall evolve from local community members like potential SHG
members, Shakti Sahayikas, SHG Book Keepers etc., with a preference to SHG members that too
from poor and EPVG households.
A Community Resource Person is a woman SHG member who will provide handholding support to
the SHGs at the village/CLF level. She will do bookkeeping of all the SHGs in a particular CLF and
also do SHG formation, training, MIP preparation of SHGs.
How many Community Resource Persons should be deployed in each Panchayat and why?
Community Resource Person will be employed at the CLF level and the CRP will provide complete
handholding support to all the SHGs within the CLF. The CRP will on average work for 5-15 SHGs.
Wherever the number of SHGs is more, 2 CRPs can also work in the village depending on the
number of SHGs.
Who can be a Community Resource Person?

Must be a literate women, with minimum of seventh standard pass, from the same GP

Age must be 18 years above.

She should have good written and oral communication skills with good computing
abilities.

She should have sensitivity toward poor women.

She should be acceptable to the SHGs in the village she is chosen to serve.

She should not have any mobility constraints for discharging the role.

She should not hold any political office or have been employed by GO/NGO either on
part-time or full time basis.
NOTE:

In schedule area ST candidate will be selected, if ST candidate not available then order
of preference will be given to 1.SC 2. Minority 3.Other.

During the selection, priority should be given to eligible PWDs.
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
In response to the notice given by the CLF/GPLF, if applications are not received from
eligible women candidates or Shakti Sahayika, then CLF/GPLF will give another notice
where male members may also be encouraged to apply.

In case a leader of SHG or an office bearer of a CLF/GPLF is selected, she must
withdraw from such position before taking up the role of CRP-CM.

If a full time employee of any Govt. / Non-Govt. organization, has to give resignation
from either post.
What are the responsibilities of a CRP?
 She will form new SHGs involving women members from left out households with focus on
EPVG, poor and tribal communities
 She will facilitate opening of saving accounts of SHGs in nearby bank
 She will be responsible for nurturing 5 to 15 SHGs (both the newly formed and earlier
formed existing SHGs) of her village/cluster
 She will provide continuous handholding support to SHG to practice the ‘Panchasutras’
 She will put her efforts to facilitate regular meetings in the SHGs
 She will attend each SHG meeting regularly and update their books of accounts and other
records
 She will impart all training programs related to SHG management, book keeping, MIP etc.
to the SHGs
 She will be responsible for preparation of household MIP of each member of the SHG and
also to consolidate it at SHG level
 She will facilitate the process of accessing loan from bank and CIF funds of OLM based on
their MIPs.
 She will communicate the SHG members in a friendly manner
 She should give respect to the decision taken by the group
 In case of any conflict inside the group she will try to resolve it by encouraging the
participation of whole group
 However
 She shall not interfere in the decision making process of the SHGs
 She shall not impose any pre-conceived notion or opinion on any SHG members.
 She shall not have any financial transaction with any SHG other than ‘as a member’ in her
own SHG
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What is Community Professional (CP)?
Community Professional is a professional engaged by GPLF/BLF to provide complete handholding
support to the GPLF and SHGs within it. S/he will be responsible for implementing all project
related activities including institution building, community finance, livelihoods, social development,
convergence programmes etc. with the support of different community resource persons and under
the guidance of BMMU.
What are the role and responsibilities of Community Professional?

Overall responsible to the GPLF & will act as connecting link between Block and GPLF.

Accountable to the GPLF for its successful functioning.

Project planning and implementation in the designated GP

Building awareness about the project and undertaking community mobilization

Facilitate in conducting situation analysis as per project guidelines

Formation and strengthening of Self Help Groups

Identification and inclusion of left out poor in SHGs

Formation of CLF with the existing number of SHGs

Restructuring / formation of GPLF

Capacity building of CLF/GPLF and their sub-committees

Prepare Training Calendar for all SHGs in the GPLF

Preparation of Micro Investment Plans (MIPs) for SHGs

Execute the decision taken by GPLF.

Facilitate in selection of CRP-CM at CLF level and MBK at GPLF level

Identification and need assessment of vulnerable household to be covered under Revolving
Fund/PPIF/any other fund as per their entitlement

Assist groups in bank linkage

Disbursement of project funds to community institutions

Submission of necessary data and reports as per project requirements

Any other task assigned by the Block team/BLF
However,
Shall not interfere in the decision making process of the GPLF.
Shall not impose any pre-conceived notion or opinion on any GPLF members.
N.B.: For details, refer to the CP guideline
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Where will the GPLF get fund to implement the Institution Building Plan?
The funds will be directly transferred to the GPLF bank account from the District Mission
Management Unit (DMMU) for implementation of the Institution Building Plan of GPLF.
How will the GPLF get the IB fund?
The GPLF will receive the IB fund on the basis of the IB Plan on an annual basis. The GPLF will
submit the plan to BMMU who will appraise it and then submit it to DMMU for sanctioning. The IB
fund will be available to the GPLF on submission of following documents to BMMU:
o Document 1: GPLF EC approved IB plan along with resolution copy to this effect.
o Document 2: A Copy of signed MoU between GPLF and BMMU
o Document 3: Utilisation certificate and statement of expenditure as and when require
IB Plan prepared with the help of BMMU and approved by the Executive Committee of the G.P.
level federation along with the Resolution.
IB fund will be given in how many tranches?
The IB fund will be released in two tranches; 80% in the first tranche and 20% in second tranches
against the approved plan.
What will the GPLF do to get the second tranche?
The second tranche will be released after receiving utilization certificate (50% of the first tranche)
from the GPLF. The expenditure must be certified by the Participatory Monitoring Committee
(PMC) and Utilization Verification Committee (UVC). The same process will be followed in the
subsequent years.
What is Participatory Monitoring Committee (PMC)?
The Committee formed at the GPLF level to monitor the functioning of GPLF is called Participatory
Monitoring Committee.
How members can be nominated to Participatory Monitoring Committee?
The Participatory Monitoring Committee will be formed taking 5 members out of which 3 members
from RGB & two members from EC and one must be from Poor and EPVG category. In case of
Scheduled area, all the members of the Sub Committee shall be tribal and one amongst them must
belong to the Poor and EPVG category. RGB will nominate the EC and RGB members to the
Participatory Monitoring Committee, subsequently approved by the GB.
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Who can be a member of Participatory Monitoring Committee?
 She must be attending meeting of SHG regularly
 She must be depositing saving fees regularly
 She must have repaid the loans timely
 She must be capable of resolving conflicts.
 Member should not be holding any political office.
What are the roles and responsibilities of Participatory Monitoring Committee?
1
The Committee shall ensure and monitor that funds allocated by GPLF.
2
It shall inform the GB regarding irregularities, if any, in the group.
3
It shall monitor the left-out poor have been formed into groups or not
4
If any complain regarding the functioning of GPLF is received at OLM office, the Committee
shall redress before intervention by the project team.
5
Ensuring that all the committees follow the procurement procedures.
6
Reporting to GB regarding any violation or deviation of rules by the EC or any other
committees.
7
Monitoring the adherence to project principles and rules in selection of beneficiaries,
implementation of sub-projects and all decisions of GB/RGB.
8
Ensuring that transparency and accountability systems are in place and functioning.
9
Investigating and reporting to EC any instances of complaints or reports of misappropriation
or misuse of loan funds.
10 Monitoring SHG performance, particularly on timely repayment of loans by members, and
recommend necessary action in the case of delinquency. Ensuring grading / credit rating of
eligible SHGs, review the linkage status at regular intervals, and ascertain that all eligible
groups are linked with local banks.
What is Utilization Verification Committee (UVC)?
The Committee formed at the GPLF level to monitor funds for intended purposes of GPLF is called
Utilisation Verification Committee.
How members can be nominated to Participatory Monitoring Committee?
Committee will be formed taking 5 members out of which 3members from RGB & Two members
from EC and one must be from Poor and EPVG category. In case of Scheduled area, all the
members of the Sub Committee shall be tribal and one amongst them must belong to the Poor and
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EPVG category. RGB will nominate the EC and RGB members to the Utilization Verification
Committee, subsequently approved by the GB.
Who can be a member of Utilisation Verification Committee?
 She must be attending meeting of SHG regularly
 She must be depositing saving fees regularly
 She must have repaid the loans timely
 She must be capable of resolving conflicts.
 Member should not be holding any political office.
What are the roles and responsibilities of Utilisation Verification Committee?
1
Verify randomly at least 25% of the loans sanctioned to SHGs to confirm utilization of funds
for intended purposes;
2
Record outcome of random verification of sanctioned loans in a systematic way; and
3
Report to EC regarding any instances of misuse of loan funds, other than intended
purposes.
After preparation of GPLF IB Plan, what is the next step?
After preparation of the IB Plan, MIPs will be prepared.
What is a Micro Investment Plan (MIP)?
The Micro Investment Plan (MIP) is an investment plan prepared by individual households which
is consolidated at SHG level. MIP is appraised at the GPLF level. It will include plans for
investment on asset creation for income generation and household need investments.
What is the necessity of preparation of MIP?
SHG members can estimate their income and expenditure, assess their assets and liabilities,
mobilize resources to increase their income and can be aware of their responsibility through the
process of MIP. This also helps in preparing investment plans for their families accurately and
easily.
In the present context, it is generally observed that group members never plan their investment
before getting loan from the bank. Loans are not disbursed among members on priority basis or as
per their necessity. Rather it is distributed equally among members. By that process, members are
sanctioned loan with no actual requirement and they repay the loan with interest. But the members
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who have necessity for more amount of loan cannot get the desired amount. As a result, they are
forced to resort to high interest borrowing.
Before getting loan from bank if a plan is prepared at the group level, members can get loan as per
their requirement. With mutual understanding, members who require loan on priority basis can be
given the loan in the first round. Others can avail loan after repayment by the members who
received in first round. This will ensure repayment of loan at the right time due to peer pressure.
Further this can help members getting loan as per their requirement and can increase the group
fund due to higher frequency of internal lending.
Moreover, funds received by the group through different Govt. schemes like SGSY is meant for
specific economic activities but all members neither have the will nor the skill to take up the same
economic activity. That is the reason why all members can’t utilize the fund with equal efficiency.
Further, loan requirement of members especially the poorer ones can’t be productive all the time.
Because of above reasons, there is necessity for preparation of MIP at household level. By the
process of MIP every member can prepare her fund investment plan at family level. Moreover, they
can get loan as per their requirement. This can further increase the group fund and loan repayment
will be fast.
How to prepare MIP?
GPLF shall consolidate
& appraise all MIPs of
member SHGs
Loan money
Loan money
Self Help Group
Family
(Members)
Compilation
of
all
loan
applications
(Verification
of
purpose & amount)
Annual estimate of income &
expenditure and their loan
repayment
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Where will the SHG get funds for implementation of MIPs?
SHG can utilize its own funds, mobilize loan from the bank or Community Investment Fund (CIF)
for the implementation of MIPs.
What is Community Investment Fund (CIF)?
The revolving fund given by the project to the GPLFs based on the MIP prepared is called
Community Investment Support Fund (CISF).
In how many tranches CISF will be disbursed?
The CISF will be disbursed in two tranches.
What will the GPLF do to get the first tranche (CISF I)?
i)
Formation/Restructuring the GPLF has been completed
ii) At least 50 % of poor and EPVG households are members in GPLF through their respective
SHGs
iii) MIPs prepared for “A” or “B” graded SHGs 3
iv) Functional committees have been formed and trained in CIF management (these include
committees fund and financial management, procurement management and social audit)
v) Separate Bank Account opened for CIF
vi) Books of accounts in place, trained bookkeeper is in place
Triggers for CISF-I

At least 40% member SHGs have obtained ‘A’ or ‘B’ grades as per the service bank’s gradation
process.

MIPs prepared for at least 50% of above ‘A’ or ‘B’ graded SHGs

At least 50% of the total SHG member households who have submitted their MIPs should be
from poor ,EPVG or Tribal households
What will the GPLF do to get the second tranche (CIF II)?

CIF-II to be given after 3-6 months of CIF-I

UC certified by Utilization Verification Committee

60% of total poor ,EPVG and Tribal households of the GP are members of SHGs in the GPLF
3
‘ A’ Grade SHG: securing 80% marks and above
‘B’ Grade SHG: securing 60% to 80% as per gradation
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
MIP need to be prepared for eligible SHGs claiming CIF II

At least 50% of poor and EPVGs/tribal have obtained loans as per MIP prepared at CIF-I

At least 60 % SHGs who have availed CIF-I have repaid loan on time.
What is Finance & Fund Management committee?
The committee which will manage the CIF fund of the GPLF is called as the Finance and Fund
Management Committee.
How is the Finance & Fund Management Committee formed?
The Finance & Fund Management committee will be formed taking 5 members out of which
3members from RGB & two members from EC and one must be from Poor and EPVG category. In
case of Scheduled area, all the members of the Sub Committee shall be tribal and one amongst
them must belong to the Poor and EPVG category. RGB will nominate the EC and RGB members
to the Finance & Fund Management Committee, subsequently approved by the GB.
What are the roles and responsibilities of Finance & Fund Management Committee?
1. The Finance & Fund Management Committee will consolidate the loan applications and
submit the same to the EC of the GPLF for approval
2. Linkage with the bank for leveraging additional funds from the bank
3. Prepare the annual budget of the GPLF and place it before the Executive Committee for
approval.
4.
Monitor repayment performance by SHGs to the GPLF and banks, and recommend
necessary action in case of delinquency.
5. Recommend to create a risk fund at GPLF level to take care of the delinquency of the loan.
6. Recommend to GPLF introducing micro financial products in insurance and remittance.
7. Liaison with Institutions, Banks for tailor made
Financial Products for the benefit of the
group members. The Financial product may include saving, Loan, Insurance and
Remittance.
8. To ensure collection of premiums from members and remittance of these premiums to the
insurance companies, without any delay.
9. To follow up with the insurance companies for ensuring timely release of compensation to
beneficiaries.
10. Facilitation for settlement of insurance claims & any other financial activity as and when
necessary.
11. Appraising the MIPs submitted by the member SHGs.
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12. Reporting to GB/RGB progress on status of MIPs appraised, CIF funds received and
disbursed to members during GB/RGB meetings.
Who will provide training to the Finance & Fund Management Committee?
OLM project will arrange training programme for the Finance & Fund Management committee
How can the GPLF ensure proper utilization of funds?
“Utilization Verification Committee” will be formed in the GPLF in order to monitor the proper
utilization of the loan funds.
What are the roles and responsibilities of Utilization Verification Committee for MIP based
loan utilisation?
4
Verify randomly at least 25% of the loans sanctioned to SHGs to confirm utilization of funds
for intended purposes;
5
Record outcome of random verification of sanctioned loans in a systematic way; and
6
Report to EC regarding any instances of misuse of loan funds, other than intended
purposes.
Who are EPVGs?
 Do not get two square meals a day
 Do not have adequate shelter
 Landless
 Do not have adequate income even for subsistence level of living
 Daily wage labourers especially from SC/ST households
 Destitute and female headed households
 Large families with one earning member as daily wage laborer
How will the GPLF identify the EPVGs?
 The process of identifying the EPVGs is known as Situational Analysis.
 For details, refer to the “Situational Analysis guideline”
 The list will be submitted, appraised, and approved by the GB of the GPLF.
 The list of EPVG will be vetted in the Gram Sabha.
How will the GPLF include the left-out women from EPVG families into groups?

A resolution will be passed in the GB in this regard and amendment will be made to the
bye-law to include the left-out women from EPVG families into groups

The GPLF will make efforts to include the identified EPVGs in the SHG functioning in their
hamlet. On willingness of the SHG members, a resolution will be passed in the SHG
meeting to include the EPVG women in the groups.
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
For details regarding the inclusion of left out EPVG refer to “EPVG Inclusion Strategy” in
the Social Inclusion booklet.
What will the GPLF do to get the inclusion funds?
The GPLF has to prepare an inclusion plan to receive the inclusion funds. After identification of the
EPVG women, resolution will be passed in the respective SHGs for inclusion of these women. The
federation will prepare the plan for inclusion of and prepare the budget for the inclusion of poorest
of poor.
For details on inclusion of EPVGs and increasing their productive potential, please refer to the
“Social inclusion booklet”.
How can the GPLF ensure inclusion of EPVG into groups?
“Social Service Committee” will be formed in the GPLF in order to implement and monitor the
proper inclusion of EPVGs.
How is the Social Service Committee formed?
The Social Action Committee will be formed taking 2 members from the EC and 3 members from
the GB .Out of these 5 members, at least 2 members are from the EPVG families. RGB will
nominate the members of Social Service Committee.
What are the roles and responsibilities of Social Service Committee?
1. To ensure the inclusion of the left-out poor and tribal to groups (with the support of the
social inclusion committee of CLF)
2. To prepare the inclusion plan of the GPLF
3. Monitoring the implementation of different social development programs of the Government
4. To address social problems amongst the SHGs and/or villagers such as bonded labour,
child labour, equity issue etc.
5. To facilitate the members to access basic amenities like drinking water, street lights, roads,
schools and sanitation.
6. To educate eligible members and their spouses on the specifics of micro-insurance
programs supported by the GPLF and enroll members as appropriate.
7. Plan and monitor special activities for the EPVGs
8. Monitoring and ensuring quality management of community based services
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How will OLM ensure Tribal representation in implementation of the project?
In Scheduled area, representation from each SHG to CLF will be tribal only. Hence it will be
ensured that the Office Bearers at CLF and GPLF will be exclusively tribal. In addition to that,
functional subcommittee at the CLF and the GPLF will have tribal only.
How will OLM strengthen the GPLF further?
OLM will further strengthen the GPLF by implementation of the GPLF Strengthening Plan.
What is the need of the GPLF Strengthening Plan?
During the transfer and management of CIF, the GPLFs’ capacity will also be strengthened
through a planned process. The GPLF strengthening plan will be prepared and implement with
assistance of different agencies.
What will be the focus of the GPLF Strengthening Plan?
The strengthening plan will focus on the following:

Developing business plans for GPLF including inputs on methods for income generation by
collecting share capital, membership fees, service fees, savings, interest margins and
penalties so that the GPLF becomes financially sustainable in a period of three years.

Management trainings for the office bearers of GPLF: It will help them to know about their
roles and responsibilities .The GPLF will be able to develop their vision and mission and
future course of action.

Capacity building for management of CIF for officer bearers, community resource persons,
executive members and CIF sub-committee members of the GPLF.

Capacity building for using Financial Management Information System to fulfill their
financial intermediary role.

Capacity building for using audit reports, financial management reports grading
reports, etc.
What is Bank Linkage?
Availing of loan from the bank by SHG is known as bank linkage.
Why bank linkage is required?
Bank linkage is required to pursue gainful activities by SHG members including consumption,
social and medical needs.
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What are the documents and other rules of availing bank linkage?
A) Eligibility criteria

The size of group should be minimum 10 and maximum 20. For physically challenged 5
members group can be considered.

SHG should be at least 6 months old

Should have been practicing Panchasutra i.e. regular meeting, regular saving, regular
internal lending, regular repayment, regular book keeping

SHG should score at least good or very good in the grading which is based on
Panchasutra
B) Application
The standard application form devised by NABARD will be used. The SHG will apply along with
a resolution for seeking loan. The authorized signatories of SHG can only submit application to
Banks. MIP prepared by SHGs will be attached to the application along with grading sheet.
C) Documents required for bank linkage
Application form along with inter-se agreement and article of agreement will be executed. The
inter-se agreement will be executed by all members; while other documents will be executed by
authorized signatories of SHG.
D) Appraisal of application and limit/loan amount.
Generally credit linkage is linked to the corpus of SHG. It is generally 1: 4 but higher limits are
considered for good SHGs and on gradual maturing process. As per RBI instruction the
following amount will be sanctioned for the SHG as fresh and repeat finance.
What Fresh Linkage-Loan given first time is called Fresh linkage and subsequent loans are
repeat linkage.
Fresh/ First dose:
4-8 times to the proposed corpus during the year or Rs. 50000/- which is higher
Second dose:
5-10 times of existing corpus and proposed savings during the next twelve months or Rs 1 lakh
which is higher.
Third dose:
Minimum Rs 2 lakhs based on the MIP and appraised by the support agency/ federation and
previous credit history.
Fourth dose:
Fourth dose and on wards-Loan amount can be between Rs5-10 lakhs for fourth dose and/or
higher amounts in subsequent doses. The amount will be based on the MIP of SHG members.
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Community Operational Manual
What is the Group corpus?
Group corpus constitutes

Group balance in SB account

Amount held as cash with the authorized officials

Amount of loan outstanding internally lent to members

Any other fixed asset if created out of their fund, it’s present value
OR

Savings of members

Any other grant, revolving fund, donations etc.

Fines and penalties collected

Group savings with GPLF if any

Interest received from members

Interest received from Bank on SB amount
E) Sanction and terms of sanction
The loan will be sanctioned by the branch or authorized officer of the bank.
F) The amount is sanctioned in form of term loan or Cash credit or both.
G) Disbursement, mode of disbursement
The disbursement is made in one installment. Generally it should coincide with the meeting
date when it is proposed to disburse the loan to its members.
H) Rate of interest
The rate of interest is linked to Benchmark Prime Lending Rate. It varies from bank to bank.
The rate is flexible in nature.
What is Interest subvention?
WSHG on regular repayment will pay to the bank @ 4% interest on loans availed from banks
on certain terms and conditions.
I) Security
No collateral security is to be taken. Peer group pressure is the security. As bank loan is their
money, all the members are jointly and severally liable for the loan. In no case SB balance is to
be retained by the bank as security as it will prevent the group from internal lending. However
loan beyond Rs.10 lacks collateral security to be taken as per banks rules.
J) Security documents and stamps duty
The following security documents are to be executed:
i) Article of Agreement
ii) Inter-se- Agreement
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Community Operational Manual
iii) Application is a part of document
As per govt. of Orissa notification Stamp duty is exempted for women SHG.
K)The purpose for which SHG will lend to the members is left to the common wisdom of the
members. They decide among themselves the purpose for which the member avails loan from
SHG. Bank does not decide the purpose. The loan is a clean loan for the bank.The loan may be
used for meeting social needs,high cosr debt swapping and taking up individual livelihoods
activities or viable common activities.
L)-Repayment.
First dose may be re[aid in 6-12 months
Second dose 12-24 months
Third dose – as per cash flow in monthly/ quarterly / half yearly between 2 – 5 years
Fourth dose- as per cash flow and between 3- 6 years.
What is MIP based Bank linkage?
All members of SHG prepare the HH investment plan the consolidation/ aggregate of each
member’s MIP is SHG MIP
What is Bank Mitra?
Bank mitra is selected from the community to manage helpdesk for the SHG in the Bank branch.
Who can be Bank Mitra-A member of the SHG selected by GPLF will be Bank mitra.
How many Bank mitra s can be for a branch?
One Bank mitra for one branch.
Whether any honorarium is paid to Bank Mitra?
Yes Bank mitra will be paid incentive as per norms decided by the GPLF.
What are main works of Bank Mitra?
Bank mitra will facilitate SHG and it’ members to open accounts of SHG and Its members and
facilitate day to day banking need s of Women SHG Members .
What is Bank Linkage and recovery committee (BLRC)?
In each GPLF there will be a BLRC who will facilitate bank linkage and recovery of bank loans.
Who will be members of BLRC?
It is an additional subcommittee of GPLF or any subcommittee may be assigned for BLRC as per
decision taken by the GPLF.
Opening of SB A/c
1. What is a Savings Bank A/c?
Savings Bank accounts are in nature of demand deposits with high liquidity and safety.
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Community Operational Manual
2. Features of Savings Bank A/c?

It promotes the habit of savings amongst the people.

It earns a moderate rate of interest.

As it is a demand deposit with liquidity the fund can be used at any point of time
required by the depositor.
3. Who can open SB A/c
i)
Individuals, Clubs, Societies, Schools, and Temples which are no profit making non
business entities can open SB accounts.
ii)
SHGs can open SB A/c as approved by RBI Vide RBI Letter No. 63/13 Dated.
04.01.1993.
iii)
Blind persons, illiterates can also open Savings Bank accounts provided they are
properly introduced and other formalities for opening of such accounts are observed.
The other formalities are, while opening of an account by an illiterate person, two independent
witnesses to be taken along with the account opening forms. In case of blind persons & disability
certificate issued by the CDMO to be obtained along with witness. Power of attorney holders can
also open SB A/s on behalf of blind person.
What are the documents required for SHG to open SB accounts?
1. Resolution
2. Rubber Stamp
3. Account Opening Form
4. Specimen Signature
5. Form 60 / 61
6. Photographs
7. Bye-law/ Rules and regulation, but it is not mandatory .
8. Copy of the registration certificate , if registered, bye law has to be submitted
What are the rules for opening SB A/c?
a) A SHG consisting of 10-20 members can open a SB A/c, list of the members along with
there signatures to be submitted.
b) A SHG consisting of minimum 5 PWDs can form a SHG and also open SB A/c.
c) Specimen signature is required for the persons operating account at the time of change
of signatories, proper resolution to be made.
d) SHG is an institution, therefore a resolution to open SB account is required.
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Community Operational Manual
Specimen of Resolution to be made in the SHG Meeting
“It is resolved that our SHG name ___________________ will open a SB A/c in
____________ Branch of __________________ Bank. It is further resolved that Smt.
____________ is the ___________ of the aforesaid SHG and Smt.________________ is
the ___________ of the SHG. The ___________ and _____________ of the SHG are
authorized by all members to open, operate the SB A/c and execute all necessary
documents for opening the account jointly.”
 The copy of the resolution duly attested to be produced to the Bank Branch.
 There should be a rubber stamp of the SHG.
 There should be one/ two rubber stamps reading as
Secretary/_______
President/_________
________, SHG
________, SHG
 The resolution should be certified as true copy. “Certified that the extract is the true
copy of the resolution of the meeting book page _______ para _______ .
 Know Your Customer(KYC) compliance for authorized office bearers
What are KYC norms – KYC is for “Know Your Customer”. As per the RBI guidelines vide
DBOD AML.BC.18/14.01.2001 – 2002 all the Banks are to follow the instruction of KYC
norms while opening any type of account or dealing with persons for any financial
transaction.
Customer Identification Procedure
Any one document from Column A and B are sufficient for KYC Compliance.
Column ‘A’
Column ‘B’
Proof of Identity
Proof of Residence
1. Passport
1. Land pass book
2. PAN Card
2. Telephone Bill
3. Voter Identity Card
3. Electricity Bill
4. Any ID Card issued by employer
4. Letter of employer*
of Govt. / Semi Govt. / Reputed
5. Credit Card Bill
Organization
6. Ration card
5. Driving License
7. Income / wealth tax assessment
6. Any Identity issued by public
order
authority or public servant
verifying signature and address.
If none of the document are available as above then photograph of president and secretary duly
signed by them on the photograph, declaration of self address or letter from Sarpanch or any other
document where place of stay is mentioned can be produced.
 Photographs – Passport size photographs of President & Secretary.
 Minimum amount for opening – For opening SB A/c initial amount varies from
Bank to Bank. However account can be opened with no balance also
 Minimum Balance in the account – As per rules prevailing by different banks
minimum balance to be kept in the SB A/c during a quarter. Which varies from bank
to bank. If the balance falls the minimum stipulated balance a service charge as per
the particular bank shall be levied. These charges are applicable to inoperative and
dormant account also.
 No. of withdrawals is 50 per half year either by cash or transfer.
 Pass book to be presented at the time of every deposit/ withdrawal except
withdrawals by cheque.
 Interest is paid by half yearly basis as per banking norms
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Community Operational Manual

No transaction in the accounts more than two year is treated as inoperative
account.
Area of operation: SHG can open account in any branch suitable to them, service area concept is
not applicable.
Rules Governing SB A/c

The persons who is holding a SB A/c has to obey the SB rules as prescribed by RBI.
What will OLM do to enhance the livelihoods options of SHG members?
In order to enhance the livelihood options of the SHGs, OLM will implement the following three
types of activities:

Developing and implementing value chains for enhancing the income of producer groups.

Enhancing employability options for the educated youth (both male and female) through
vocational skill development.

Innovations for livelihood promotion and its extension through different institutions
What is a Producer Group (PG)?
Producer Group is a business organization, owned and managed by the poor and marginal
producers for their mutual benefit, formed with an objective of enhancing production and
access to services and markets on a sustainable basis. Producers group consist of 50 - 150
members involved in same activity. In case of non-farm activity minimum size of PG can be of
thirty (30) numbers of producers.
What are the eligibility Criteria for funding to PG?
Producers Groups:
a. Should consist of 50-150 members. In case of non-farm activity it can be 30 to 150
members.
b. Should have 50% of poor and EPVG members
c. Should have a bank account in any scheduled bank
d. Should have selected Official bearers
e. Should have formed relevant Committees as per PG Guideline
f.
Should have selected Livelihood Support Person for the Producers Group
What are the eligible activities for PG?
a. Institution Building
i. Orientation of producers (in case of forming new PG).
ii. Start-up kit includes basic minimum requirements like Weighing scale,
Tarpaulin, stationery etc.
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Community Operational Manual
iii. Remuneration of the LSP/ CRP of producers group.
b. Capacity Building
i. Capacity building of Executive Committee on PG members involved in
various activities.
c. Productive Community Infrastructure: It includes equipment and machineries,
rent of building as common work place. All civil construction works will not be
eligible for support from the project.
d. Support to Producer Group required towards procurement of inputs like raw
materials for one business cycle.
e. Marketing
f.
Monitoring
How will OLM work to increase income of the producer groups?

The Block Mission Management Unit (BMMU) with the help of the Block Level federations
will prepare a list of economic activities which can be promoted in the concerned block.

From among the list only those economic activities will be selected which will benefit
majority of the members.

Business plan will be prepared for each selected economic activity. The business plan will
include all necessary components of a trade, starting from pre-production till marketing of
products.

It will provide necessary support and guidance to the producer groups at all levels which
includes production, processing, costing, market linkage etc. In this process OLM will build
up capacity of the producers by providing them technical know-how, providing them with
required infrastructure and establishing credit linkages for successful implementation of the
economic activities.
N.B: Please refer Producer Group Policy for detail.
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Community Operational Manual
PRODUCER GROUP
SELF HELP GROUP-1
12 Members
Poultry
5 Members
Mushroom
Cultivation
3 Members
SELF HELP GROUP-2
10 Members
Dairy
5 Members
Poultry
2 Members
Mushroom
Cultivation
3 Members
Dairy
4
Member
s
PRODUCER GROUP
INVOLVED IN
DAIRY
SELF HELP GROUP-3
11 Members
Dairy
3 Members
Poultry
4 Members
Mushroo
m
Cultivati
on
4
Members
PRODUCER GROUP
INVOLVED IN
POULTRY
PRODUCER GROUP
INVOLVED IN MUSHROOM
CULTIVATION
**Poor and Vulnerable Non-SHG members can also be a part of the Producers Group. Producers Group may also have male
members.
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Why does OLM want to create job opportunities for the rural youths?
In order to fulfill the following objectives OLM will facilitate creating job opportunities for
the rural youths:
a. Create job opportunities for the educated youth of poor rural households and
provide them with related skills.
b. To check migration of rural youths
c. To design skill based training program that will cater to the need of industrial
development in the state of Odisha.
d. To establish Centers of Excellence for capacity building of youths at the district
and state level
What role OLM will play to create employment opportunities for the rural youths?
a. In concerned blocks the BMMU will analyze existing employment opportunities
with the help of SHG and GPLF members. Together they will map the different
employment options available at different sectors in the subsequent year and
skills required for that particular job.
b. It will identify educated unemployed youths belonging to the extremely poor and
vulnerable groups through the GPLF.
c. Establish linkage with different industries and other employment sectors.
d. OLM will organize training programs for the youths in the Industrial Training
Institute to meet the skill requirement of different industries and employment
sectors so that they can be absorbed by those industries and other sectors.
How can we maintain transparency in SHGs and GPLF?
Sensitization of members about the federation bye-law:
In order to sensitize the members about different rules and regulations of the federation,
a copy of the byelaw will be given to each member SHG. The EC of the federation will
monitor whether each member is aware about the byelaw or not. Similarly each SHG
should have its own byelaw and all the members should be aware about the rules and
regulations of their respective group.
Ensuring proper utilization of loan by the SHGs and awareness of all members
about the loan received by their Group:
The GPLF will reflect the amount and source of loan in its resolution book and display
the same in the notice/transparency board. The GPLF will pass a resolution on the
amount of loan to be given to each applicant group and the same will be displayed in the
Community Operational Manual
notice board. The Participatory Monitoring Committee will monitor whether the SHGs
and its members are getting timely loan or not. The Utilization verification committee will
verify the utilization purpose of the loan on a random sample basis.
Ensuring awareness of the members about the General Body Meeting and the
Decisions taken in the Meeting:
The GPLF resolution will be displayed on the notice board every month. The decisions
taken during the General Body Meeting should be placed in the notice board. One copy
of the resolution will be given to the SHG members who are representing in the
federation which they will discuss in their respective groups.
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Community Operational Manual
Annexure-I
Situational Analysis of Self-Help Groups:
1. Present status of SHGs
2.
3.
4.
5.
6.
7.
a. Whether the members are staying in close vicinity?
b. Number of members in the SHG
c. Composition of APL and BPL members
d. Composition of literate and illiterate members
e. Duplication of membership
Conducting meetings
a. No. of meetings conducted in a month
b. Fixation of date and time for the meeting
c. Attendance of members
d. Awareness of members on the rules and regulations of SHGs
e. Leadership ability of members
f. Participation of all members in the meeting
g. Response of members to the President and Secretary of the SHG
h. Decision making process of the group
Monthly savings
a. Equal or differential savings
b. Regular or irregular savings
c. Opening of Savings account in the bank
d. Regular deposit in the bank
e. Cash in hand to meet the exigencies
Loan transactions
a. Regular repayment of loan
b. Repayment in regular installments
c. Loan from bank
d. Individual repayment of members
e. Need based disbursement of loans or equal distribution of loans
Regularity of maintenance of records
Income generating programmes
Social Development programmes
a. Women and Child Health Programme
b. Mid-day meal scheme
c. Rural Sanitation Programme
d. Attending Pallisabhas
e. Working towards literacy
f. Helping the destitute and people with special needs
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Community Operational Manual
Annexure-II
Situational Analysis of GPLF:
Indicators
Means of verification
Formation :
1. The President and Secretary of the Meeting Register of GPLF
member SHGs should be nominated
to the RGB of the GPLF
2. EC should be nominated by the GB
Resolution Book of GB
3. Number of functioning SHGs who are Member Registration Book
members of GPLF
4. Awareness of members on the bye- Through discussion
law of GPLF
5. Timely maintenance of records
Records
6. Registration of the GPLF
Bye-law and registration certificate of the
GPLF
Conducting Meetings:
1. EC should
monthly.
meet
at
least
once Resolution Book of the EC
2. Monthly subscription collected and Bank passbook of GPLF
deposited in the bank
3. Regularity of loan transactions
Loan Ledger
4. Inclusion of new SHGs in the GPLF
Application form; Member Registration Book
5. Unanimous decision and
participation of members
active Resolution Book of the EC and GB
Activities of GPLF:
1. Involvement of GPLF in
development programmes
social Resolution Book of the GB
2. Business Development Plan (BDP) of Copy of the BDP approved by the GB
GPLF
3. Gradation of SHGs
Gradation form of SHGs
4. Inclusion of GPLF by the federation
Resolution Book of the GB
------
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