Sa-Dhan Newsletter Volume 4 Issue 2

Community Based Organisations

strict adherence to rules and norms with little or no

CS Reddy starts his presentation by introducing APMAS -

relaxation. Federations became (low cost) instruments

vision, mission, and services. He then talks about Women

for providing credit and implementing the program

SHG movement in AP; variations in Federation model under

rather than an end themselves. Social intermediation

which he defines federation, rationale for federation formation,

on the other hand requires greater flexibility and

three-tier federations of SHGs - UNDP / Velugu Project, two-

investment in members for diverse capacities.

tier federations of SHGs - NGOs & DRDA, Nested institutions

5.

Federations being promoted across the country represent

- DHAN, Federations of Cooperatives - CDF; Role of various

a variegated kaleidoscope and it was not possible to

tiers of the federation and Emerging model of federation.

generalize or to study all the federations without

understanding the different types of federations. The

According to him, there are 439000 SHGs in AP out of which

study has arrived at a typology of federations based on

3,64,194 are linked with banks (cumulative) Loans outstanding

field observations.

with SHGs is less than 500 crores and the total corpus is RS

1,043.00. The definition of federation according to APMAS

6.

There were two broad categories that emerged according

study, is a network, association, and coalition of primary

to the functions - federations engaged in financial

organisations to collectively achieve what they cannot do

functions and federations not engaged in financial

alone.

functions. Federation undertaking financial functions

were further categorised as those providing only micro-

The rationale for the formation of federation is - 1). For

finance services and those providing integrated

strengthening existing SHGs 2) to promote new SHGs of the

development support with empowerment as a dominant

poor and 3) to access various services to the member SHGs.

component and/or livelihood support along with micro

4) to provide a sense of solidarity among members of

finance services.

different SHGs in an area. 5) For sustainability of SHGs. Also,

federations play an important part in SHG capacity building

7.

Second differentiation was made on account of

and conflict resolution - both internal and external. Models

management control of federations- Federations in

of federation are influenced by a number of other factors. This

which the promoting institution (PO) is playing a

includes vision, mission and goal or the promoters. Clients,

dominant role in management, and federations with

its characteristic, needs, and capacities, geography, culture

members managing their affairs.

and legal also effects the model. Model is also affected by the

kind of activities such as microfinance and microfinance plus.

8.

This analysis has led us to four types of federations

undertaking financial operations and two types of

Diagram: 1. Model of Federation promoted under UNDP/

federations engaged in non-financial operations

Velugu Project

Financial Federations

Mandal Samakya

High PO Managed/

Q1

Q2

Controlled

Village

Village

High member

Organisations

Organisations

Q3

Q4

Managed/Controlled

Finance

Finance Plus

SHG

SHG

SHG

SHG

SHG

SHG

Non financial federations

MEMBERS

High PO Managed/

C1

Controlled

C2

High member

Diagram: 2. Model of 2-Tier institutions promoted

Managed/ Controlled

by NGOs & DRDA

MANDAL/CLUSTER FEDERASTION

ROLE AND DESIGN OF THE FEDERATION FROM

A STRATEGIC CHOICE PERSPECTIVE

This presentation was followed by C.S. Reddy, CEO, Andhra

SHG

SHG

SHG

SHG

SHG

SHG

Pradesh Mahila Abhivruddhi Society (APMAS) who spoke on

the role and design of the federation from a strategic choice

perspective.

MEMBERS

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