SHG common livelihood Fedaration

Objective : SHG members and those involved in individual or small group activities have to graduate to higher levels of activity for increasing their income and for more sustainable benefits. With a view to achieve this Pudhu Vaazhvu Project and Tamil Nadu Women Development Corporation project has formulated a plan to give handholding and mentoring support to improve the quality, sustainability of these individual livelihoods through Common Livelihood Groups (CLGs) and then aggregate them into CLFs.

 Scope :After the completion of the Resource Mapping Exercise in the Panchayats, the data will be informed to various village institutions, SHGs and PLFs to take sound decisions about livelihoods and select viable livelihood activities.  The Districts promote one or  two major livelihood activities emerged out of these MCPs of poor households through CLGs and CLFs.  The CLGs support these individual livelihood activities through common procurement, marketing, collection, technical assistance,  information sharing etc., to improve their business so as to get enhanced income.  The CLGs will federate further into CLFs at inter village level to start production activities for value addition and to take advantage of economy of scale.

Size: minimum 150 target people,  a minimum of 70% should be from the target community.

Jurisdiction of  CLF: can be formed at inter village level, which can be between two villages / multiple villages at cluster level / block / district level by federating CLGs.

Benefits of CLF: CLF being higher level institution of community for promoting livelihoods of the poor, it can extend the following benefits to the community

  • Creation of common assets based on the value addition activity
  • Access to Higher credit linkages from banking institutions
  • Common Marketing Procurement of products/ raw materials by concrete partnerships.
  • Profitable price realization for the products
  • Technical assistance to improve the quality of the products
  • Reducing the cost of production by common procurement of raw materials

Legal status: CLFs are registered under the Tamil Nadu Societies Registration Act 1975.

Training for the Federation members: For the success and profitability of the business activity that is initiated, previous experience in that business and appropriate training on the business activity are necessary. Also there should be interest, commitment, qualification and skills to handle latest technologies.  Hence the Federation  should identify the trainings  required for the success of the business, and provide them to members.  The following trainings have to be planned and given to all Federation members within a period of one month from the date of registration of the Federation.

  • Governance
  • Financial management
  • Business Plan Preparation
  • Technical Training pertaining to that activity

Scrutiny of the Business Plan by State Office: The State office will scrutinize the Business Plan received from the District by forming a committee with officials  for taking a decision.  Based on the decisions taken by the committee the proposals will be cleared and fund released to the concerned Vattara / Mavatta MaKaMai (District Level Federation) for further action.

Release of Fund to the Federation: All the Federation funds from the PVP will be released to the concerned federation through DPMU. Based on the appraisal of State team, Project Director will approve the Business Plan and sanction the fund support from PVP. Simultaneously, CLF will approach other agencies like TNCDW (NRLM) NABARD or any other bank for sanction of fund or loan etc.

Continuous handholding and mentoring support to the federation in terms of funds and capacity building will be done through the project for a minimum period of 5 years.