IMPACT OF SELF HELP GROUPS IN REDUCTION OF

URBAN WOMEN POVERTY IN HAWASSA, SNNPR

Thesis submitted to Hawassa University in partial fulfillment of the

requirements for the MA Degree in Cooperatives Development and
Leadership

Submitted By: FASIL SHIBRU GEBREHIWOT

Advisor: Dr. R. DAYANANDAN (Ph.D.)

Co-Advisor: HABTAMU GETNET (MA)

DEPARTMENT OF COOPERATIVES

COLLEGE OF BUSINESS AND ECONOMICS

HAWASSA UNIVERSITY

June, 2013
 SCHOOL OF GRADUATE STUDIES
HAWASSA UNIVERSITY
ADVISORS’ APPROVAL SHEET

This is to certify that the thesis entitled “Impact of Self Help Groups in Reduction of
Urban Women Poverty in Hawassa, SNNPR” submitted in partial fulfillment of the
requirements for the degree of Master's with specialization in Cooperative development
and Leadership, the Graduate Program of the Department/School of Cooperatives, and
has been carried out by Fasil Shibru Gebrehiwot Id. No CODL/012/04, under my/our
supervision. Therefore I/we recommend that the student has fulfilled the requirements and
hence hereby can submit the thesis to the department.

________________________ _______________
Name of major advisor Signature Date

_______________________ ________________
Name of co-advisor Signature Date

Final approval and acceptance of the thesis is contingent upon the submission of the final
copy of the thesis to the School of Graduate Studies (SGS) through the Department
Graduate Committee (DGC) of the candidate‟s department.
 SCHOOL OF GRADUATE STUDIES

HAWASSA UNIVERSITY

EXAMINERS APPROVAL SHEET

We, the undersigned, members of the Board of Examiners of the final open defense by
Fasil Shibru Gebrehiwot have read and evaluated his/her thesis entitled “Impact of Self
Help Groups in Reduction of Urban Women Poverty in Hawassa, SNNPR” , and
examined the candidate. This is therefore to certify that the thesis has been accepted in
partial fulfilment of the requirements of the degree of M.A. in Cooperative Development
and Leadership.

______________________ __________________

Name of the Chairperson Signature Date

_______________________ ___________________

Name of the Internal Examiner Signature Date

_______________________ __________________

Name of External Examiner Signature Date

Final approval and acceptance of the thesis is contingent upon the submission of the final
copy of the thesis to the School of Graduate Studies (SGS) through the Department
Graduate Committee (DGC) of the candidate‟s department.

Stamp of SGS Date

 DECLARATION

I hereby declare that this MA thesis dissertation is my original work and has not been
presented for a degree in any other university, and all sources of material used for this
thesis / dissertation have been duly acknowledged.

Name: ___Fasil Shibru Gebrehiwot___________________________________

Signature: ________________________________________

This MA thesis dissertation has been submitted for examination with my approval as
Thesis/Dissertation advisor.

Name: ____________________________________

Signature: __________________________________

Place and Date of Submission: _________________________________

 ACKNOWLEDGEMENT

"I will sing to the Lord all my life; I will sing praise to my God as long as I

live. May my meditation be pleasing to him, as I rejoice in the Lord" Psalm

104:33-34

First and foremost I would like to thank God for he has helped me throughout my life.

Without GOD nothing may be possible.

It is my wish to express my love and gratitude to my lovely wife; for her understanding,

endless love, encouragement and support throughout my study.

This thesis is made possible through the help and support from everyone, including:

teachers, colleagues and friends. Especially, please allow me to dedicate my

acknowledgment of gratitude toward the following significant advisors and contributors:

First, I would like to thank Dr. R. Dayanandan (Ph.D.) for his most support and

encouragement. He kindly read my thesis and offered invaluable detailed advices.

Second, I would like to thank Ato Habtamu Getnet (MA) read my thesis and to provide

valuable advices as well as all the other professors who have taught me about cooperatives

and leadership over the past two years of my pursuit of the Masters degree.

My special thanks go to Ato Tsehaywota Taddesse, Dr. Fikre Lobago, Gebyehu Abera,

and Yacob Esayas who continually supported and encourage me throughout my study.

I am also grateful to Compassion international Ethiopia for the unreserved financial

support and for giving me a freedom in my work schedule

Finally, I sincerely thank my friends and colleagues Alemseged, Deborah, Girma,

Solomon, Teketel and Zewdu who encouraged me and continually prayed for me. This

research paper would not be possible without their kind cooperation.

i
 TABLE OF CONTENT
Pages

ACKNOWLEDGEMENT i

ABBREVIATIONS v

LIST OF TABLES vi

LIST OF GRAPHS vii

LIST OF FIGURE vii

LIST OF APPENDICES viii

ABSTRACT ix

CHAPTER-I- INTRODUCTION 01

1.1. Background of the study 03

1.2. Statement of the Problem 07

1.3. Objectives of the Study 09

1.4. Research Questions 10

1.5. Significance of the study 10

1.6. Scope and limitation of the study 11

1.7 Organization of Thesis 11

CHAPTER– II- LITERATURE REVIEW 12

2.1. Introduction 12

2.2. Concept, Meaning and Definition of SHG 12

2.3. Urban Poverty and Vulnerability 16

2.3.1. Poverty 16

2.3.2. Poverty: prevalence of illness, water and sanitation 20

2.3.3. Poverty indicated by the source of energy for lighting and cooking 22

2.3.4. Poverty as related to housing Ownership 23

ii
 Pages

2.3.5. Urban Poverty 23

2.3.6. Urban Unemployment 25

2.4. Vulnerability 26

2.5. Empirical Evidences 26

CHAPTER – III- METHODOLOGY 32

3.1. Description of the Study Area 32

3.2. Sampling and Sample Size 35

3.3 Source and type of Data 37

3.4 Method of data collection 37

3.5 Method of data analysis 37

3.6 Conceptual frame work 45

CHAPTER – IV- RESULTS AND DESCUSSIONS 50

4.1. Socio-economic Profile of the respondents 50

4.2. Change in Knowledge and Awareness due to participation in SHG 55

4.3. Impact of SHG in urban women poverty Reduction 62

4.3.1. Income Change 63

4.3.2. Change in saving habit and amount 65

4.3.3. Change in access to loan 67

4.3.4. Housing conditions and Household Items 69

4.3.5. Change in frequency of meals per Day 72

4.3.6. Incidence of Illness 73

4.3.7. Access to medical facilities 74

4.3.8. Chang in food Expenditure 75

iii
 Pages

4.3.9. Medical Expenditure 76

4.3.10. Expenditure for House Rent 77

4.3.11. Expenditure for piped water 78

4.3.12. Expenditure on electric power 79

4.3.13. Expenditure on Transportation 80

4.4. Factors determining the participation of women in SHG 83

4.5. Factor Determining the Success of SHG 86

4.6. Findings of Focus Group Discussion 89

CHAPTER – V- CONCLUSION AND RECOMMENDATION 93

5.1. Conclusion 93

5.3. Recommendations 95

References 97

Appendix 103

iv
 ABBREVIATIONS AND ACRONYMS

CDD Community Driven Development

CSA Central Statistics Agency
EDHS Ethiopian Demographic Health Survey
FAO Food and Agriculture Organization of the United Nations
GDP Gross Domestic Product
GTP Growth and Transformation Plan
HIV/AIDS Human Immune Virus/ Acquire Immune Deficiency Syndrome
IGA Income Generating Activity
MYRADA Mysore Resettlement and Development Agency
MDG Millennium Development Goal
NABARD National Bank of Agriculture and Rural Development (India)
PASDEP Plan for Accelerated and Sustainable Development to End Poverty
SDPRP Sustainable Development and Poverty Reduction Program
SHG Self Help Group
SNNPR South Nation and Nationality People Region
UNCF United Nations Children Fund
UNDP United Nations Development Program
UNESCO United Nations Educational, Scientific and Cultural Organization
UNFP United Nations Population Fund
UN-HABITAT United Nations Human Settlements Program
USAID United States Agency for International Development

v
 LIST OF TABLES
Table Title Pages
Number
3.1 SHGs in the Selected Sub-cities and number of sample
respondents from each SHGs 36
3.2 Sampling and Sample Size Summery 37
4.1 Socio-economic Profile of the respondents 52
4.2 Respondents Participation in Trainings 57
4.3 Respondents Health and Sanitation Knowledge Change 58
4.4 Respondents Awareness Change about SHG and its activities 59
4.5 Respondents Social Awareness Change 60
4.6 Respondents Influence in decision making 62
4.7 Respondents Income, Consumption and Expenditure Changes
due to membership in SHG 63
4.8 Distributions of Respondents Income Change
Before and After SHG 65
4.9 Respondents Saving before and after joining SHG 67
4.10 Access to Loan before and after Joining SHG
from different sources 69
4.11 Respondents Housing Conditions 71
4.12 Possession of Household Items 72
4.13 Frequency of Meals per Day before and after SHG 73
4.14 Respondents Expenditure for food per day before and after
involvement in SHG 77
4.15 Expenditure for Medical Treatment before and after SHG 78
4.16 Respondents House Rent Expenditure before and after SHG 79
4.17 Expenditure for piped water before and after SHG 80
4.18 Respondents Electric power Expenditure before and after SHG 81
4.19 Respondents Expenditure for transportation before and after SHG 82
4.20 SHG membership Period 84
4.21 Reasons for Participation in SHG 85
4.22 Ranked Reasons for Participation in SHG 86
4.23 Respondents Reasons for joining SHG 85
4.24 Factors Determining the Success of SHG (Component Matrixa) 88
4.25 Factors Determining the Success of SHG
(Rotated Component Matrixa) 89

vi
 LIST OF GRAPHS

Graph
Number Title Page
4.1 Respondents annual income before and after SHG 66

4.2 Respondents Incidence of Illness before and after SHG 74

4.3 Respondent's Access to Health Centers 76

4.4 Respondents food expense per day per family 77

4.5 Respondents below and above the national poverty line

before and after SHG 83

LIST OF FIGURE

Figure
Number Title Page
3.1 Map of SNNPR and Hawassa 35

3.2 Conceptual frame work 47

vii
 LIST OF APPENDICES

Annex I: Structured Interview Schedule (For SHG members)

Annex II: Key Informant Interview (For SHG Leaders)

Annex III: Focus Group Discussion (For Project Facilitators and Community

Worker)

viii
 Abstract

Ethiopia in one of the world’s poorest countries and poverty has many aspects of
deprivation. People are poor because they do not have adequate resources to buy all the
commodities that they need. Poverty is also associated with insufficient outcomes with
respect to many human development indicators, such as health, nutrition, education and
literacy, social exclusions and deficient social relations, vulnerability and insecurity, and
with low voices, power and self-confidence, lack of opportunity, and an inability to make
use of existing resources. Different attempts had been made to improve the life of the poor
in Ethiopia. The Self Help Group (SHG) development strategy is one of those efforts; and
it is a community owned and managed poverty reduction designed to empower the poor in
general and the poor women in particular. However the empirical evidences are lacking
in Hawassa regarding the role played by the SHGs in reduction of poverty and
improvement of poor especially women. Hence this study was carried out to assess the
impact of SHG in reduction of urban women poverty. The information required for the
study was collected from 121 respondents who are members of 26 SHGs in three sub cities
of Hawassa city. Multistage sampling procedure was followed to select the sample SHGs
and members. The data collected was analyzed using basic statistics such as mean,
percentages and paired T-test with Statistical Package for the Social Sciences (SPSS) 20
version. In addition to this, factor analysis was carried out to find out the variables which
contribute to the success of SHG. The study finding shows that women’s knowledge and
awareness has increased due to SHG membership, in addition to personal and
environmental hygiene. The study also verified that involvement in SHGs leads to
improvement in the household income that contributes a great deal to poverty reduction
among urban poor women. Findings pointed out that the top five reasons for participating
in SHGs were mobilizing saving, access to loan, promotion of income generating
activities, family and personal asset possession and low income before joining SHG. The
study confirmed that respondents’ housing condition has improved in terms of the number
of rooms and the capacity of paying for rent after joining in SHG; in addition, the capacity
of paying for food, medical treatment, transportation, electric power and piped water has
significantly increased after joining SHG. Frequency of meal per day with each family has
improved substantially. The findings also depicted that after joining SHG women's
participation in family decision making has improved and shared decision making
increased considerably. The results from factor analysis revealed that the top five factors
contributing to the success of SHG are clear all its debts up to now, loan amount, current
capital, team work, and educational status. Based on the findings suitable
recommendations also forwarded.

Key Words: Self Help Groups (SHGs), urban women Poverty, Poverty Reduction.

ix
 CHAPTER-I
INTRODUCTION
Despite remarkable progress achieved since the Second World War, especially in parts of

Asia, abject poverty remains widespread in many parts of the world. According to the

international poverty line, which is $1.25 a day, there are still 1.4 billion people living in

poverty (FAO, 2009). Poverty and inequality are closely related, and inequality appears to

have been on the rise worldwide in recent decades at both national and international levels.

More than 80 percent of the world‟s population lives in countries where income

differentials are widening. The poorest 40 percent of the world‟s population account for

only 5 percent of global income. On the other hand, the richest 20 percent account for 75

percent of world income (UNDP, 2007). Extreme poverty does not entail just having

unsatisfied material needs or being undernourished. It is often accompanied by a

degrading state of powerlessness.

There is no doubt that economic development is critical for human development, and it is

imperative that growth be sustained. But growth per se is not enough. Africa Human

Development Report shows, rapid economic progress in Africa has not brought food

security for the substantial proportion of the population still gripped by hunger (UNDP,

2012). Over the past decade, Sub-Saharan Africa‟s impressive economic performance has

resulted in a marginal poverty reduction, with the proportion of people living on less than

US dollar 1.25 a day decreasing from 56.5 percent in 1990 to 47.5 percent in 2008.

The Ethiopian people have been suffering from poverty and poverty related problems like

malnutrition and disease for a very long period of time. The proportion of people who are

absolutely poor (unable to meet their basic needs) during the year 2011/12 was 29.2

percent (MoFED, 2011).

1
The government of Ethiopia has been implementing a series of poverty reduction

strategies, beginning with the Sustainable Development and Poverty Reduction Program

(SDPRP) and its successors, the Plan for Accelerated and Sustained Development to End

Poverty (PASDEP) and now the Growth and Transformation Plan (GTP). The first being

the Sustainable Development and Poverty Reduction Program (SDPRP), which covered

three years, 2002/03-2004/05. During SDPRP, the country began to register better

economic performance, with an average GDP growth of 6.7 percent per year (and an

average annual per capita income growth rate of 3.65 percent). The second and third years

of SDPRP period actually registered double digit economic growth, with annual rates of

11.9 percent and 10.6 percent, respectively. Since then, the country has maintained high

growth rates (MoFED, 2011). In 2012, the Ethiopian economy is estimated to be the third

fastest growing economy in the world, and the first fastest growing economy in Africa

(FDRE, CRGE, 2011). The country has registered such encouraging economic

performance through the formulation of policies and implementation of programs and

putting in place appropriate institutional arrangements.

There are a number of ways that women can be integrated into national poverty reduction

strategies from which they, as well as their families, can benefit. For instance, investing in

women to improve their education, skills, and access to resources and job opportunities

has been found to reduce poverty and improve the wellbeing of women and society.

Being the cornerstone of the family, women can have a great impact not only on the

household income, but also on the education of children and avoiding early child deaths

due to bad habits, sanitation or improper food or water. Women are striving to improve

life for their children and communities, while often facing the harshest of circumstances.

Women make up half of the country's population. When women do not have the

opportunity to secure an education, or earn money, or have a voice in family or

2
community decisions, half of the country‟s creativity, intellect and determination are not

put to use. These are barriers that women in the developing world like Ethiopia face every

day, and as a result, we all suffer when women's voices remain silent.

Understanding the relationship between poverty and social problems, awareness raising

workshops, training women to participate in income generating activities through SHG

allow women to be economically active. Traditionally, women looked after children and

relied on men for economic support. Participating in small business in urban areas not only

enabled women to earn income for their families, but give them economic independence

and stability. The more money women make the most power they may able to assert in the

household.

A woman‟s economic independence increases her stature within and outside her

household. SHG empower women to reduce poverty so as it‟s very clear that women are

now accepted as economic contributors. After joining SHG more women participate in

decision making and make decisions jointly with their husbands. Economic stability and

equality within family structures may improve quality of life within families (Bezabih

2007).

1.1. Background of the study

Ethiopia suffers from poverty, GDP per capita is one of the lowest in the world, and the

economy faces a number of serious structural problems. Ethiopia‟s economy is based on

agriculture, which accounts for 41 percent of GDP and 85 percent of total employment.

(African Economic Outlook, 2012).

According to the 2010/11Household Income Consumption and Expenditure Survey

(HICES), the proportion of poor people (poverty headcount index) in the country is

estimated to be 29.6 percent in 2010/11 while the proportion of the population below the

poverty line stood at 30.4 percent in rural areas; it is estimated to be 25.7 percent in urban

3
areas. The poverty gap index is estimated to be 7.8 percent while it is 8.0 percent in rural

areas and 6.9 percent for urban areas. Similarly, the national level poverty severity index

stood at 0.031 with rural poverty severity index (0.032) being slightly higher than that of

urban areas (0.027). Between 2004/05 and 2010/11, income (consumption) inequality

measured by Gini Coefficient has shown a slight decline from 0.3 in 2004/05 to 0.298 in

2010/11. Inequality as measured by the coefficient has declined in urban areas from 0.44

to 0.37, while rural inequality increased from 0.26 to 0.27 though inequality is still higher

in urban than in rural areas.

According to key findings of the urban employment unemployment survey by the Central

Statistical Authority of EFDRE 2012, the employment ratio of urban population was 51.5

percent. The differential by sex also depicts that the ratio of males 61.7 percent is

significantly higher than females 42.6 percent. 1,634,069 persons were engaged in the

informal sector out of the total 5,152,260 urban employed population. The proportion of

employed persons who have been working in the informal sector declined from 36.5

percent in May 2009 to 31.7 percent in March 2012. Females who work in this sector are

significantly higher than males. The unemployed population in urban areas of the country

was 1,218,574 with an unemployment rate of 17.5 percent. This means that nearly 18

persons are unemployed out of 100 economically active persons aged ten years and above.

The differentials of unemployment rates by sex show that the female unemployment rate

24.2 percent is more than double as compared to male (11.4 %). In Southern Nation and

Nationalities People Region (SNNPR) the unemployed population in urban areas of the

region was with an unemployment rate of 12.4 percent. The differentials of unemployment

rates by sex show that the female unemployment rate 17.5 percent is more than double as

compared to male 8.0 percent (CSA, 2012).

4
Urban residents are more dependent on cash incomes to meet their essential needs; income

poverty is compounded by inadequate and expensive accommodation, limited access to

basic infrastructure and services, exposure to environmental hazards and high rates of

crime and violence. This gives urban poverty a distinctive gendered dimension as it puts a

disproportionate burden on those members of communities and households who are

responsible for unpaid care work such as cleaning, cooking and looking after children, the

sick and the elderly. At the same time, cash based urban economies mean that poor women

are compelled, often from a very young age, to also engage in paid activities. In many

instances this involves work in the lowest-paid formal and informal sector activities

which, at times of economic crises, require increasingly long hours for the same income.

Combined with cuts in the public provision of services, higher costs for food, water and

transport, efforts to balance paid work and unpaid care work take a growing toll on

women. A gendered perspective of urban poverty reveals the significance of non-income

dimensions such as time poverty. It also highlights fundamental issues of equality and

social justice by showing how women‟s unequal position in the urban labor market, their

limited ability to secure assets independently from male relatives and their greater

exposure to violence. Shelter is at the core of urban poverty. Overcrowding, inadequate

infrastructure, insecurity of tenure, risks of natural and human-made hazards, exclusion

from citizenship rights, and distance from employment and income-earning opportunities

are all linked (UNFPA, 2012)

Like any other African countries urban poverty in Ethiopia tends to exhibit eight major

aspects; these are: (1) Inadequate income which gives rise to inadequate consumption of

necessities including food and, often safe and sufficient water and often problems of

indebtedness with debt repayments significantly reducing income available for necessities;

(2) inadequate, unstable or risky asset base both material and non-material including

5
educational attainment and housing for individuals, households or communities; (3)

inadequate shelter which is typically of poor quality, overcrowded and insecure; (4)

inadequate provision of “public” infrastructure comprising piped water, sanitation,

drainage, roads, footpaths, and so on which increases health burden and often work

burden; (5) inadequate provision of basic services such as daycare centers, schools,

vocational training centers, health-care clinics, emergency services units, public transport,

communications and law enforcement; (6) limited or no safety net to ensure that basic

consumption can be maintained when income falls as well as to ensure access to shelter

and health care when these can no longer be paid for; (7) inadequate protection of poorer

groups’ rights through the operation of the law including laws and regulations regarding

civil and political rights, occupational health and safety, pollution control, environmental

health, protection from violence and other crimes, protection from discrimination and

exploitation; and (8) poorer groups’ voicelessness and powerlessness within political

systems and bureaucratic structures , leading to little or no possibility of receiving

entitlements; organizing; making demands; and getting a fair response (Akin, 2005).

Urban poverty requires the urgent attention of policy makers‟. Rural urban migration is

increasing with an alarming rate and the facts show that Rural-Urban migration in Ethiopia

is very high due to numerous reasons for the most part economic reasons. According to

2005 -2010 estimation the urbanization rate of Ethiopia was 4.3 percent which ranked the

country 14th in the world and also the urban population was 17 percent (2008 estimation)

(CIA World Factbook, 2010) . According to Feleke, et. al. (2006) this is evidence that

poverty is becoming an urban same as a rural problem. Unless urban poverty is addressed,

continued urbanization will result in increases in urban poverty and inequality. This may

have profound consequences for the city as a whole, as growing inequalities can strain its

6
ability to prosper. It will affect relations between the different economic groups and may

lead to rising levels of insecurity, which in turn could lead to conflict.

The question is how can urban poor women be released from the yokes of poverty? Free

handouts from NGOs and government agencies have made poor people develop a

dependency attitude and have robbed them of their confidence in their own ability to

tackle problems. The main reasons for this failure are related considerably to projects

being planned and implemented in a top-down approach, with little regard for the actual

felt needs and existing potential of the poor people to take them out of poverty (Florescu,

2009). The urban poor women have potential in them. The Self Help Group (SHG)

approach seeks to bring out this potential and mainstream them with the rest of the

community. The approach seeks to draw them back from the margins. Once they start

discovering their potential and self-worth, there is no stopping them from development

(Kindernothilfe, 2008).

The basic idea of working with women SHGs is to train and organize women into groups

of 10-20, to start a saving and credit scheme with capital coming from their own savings

accumulated for a certain length of time, without much finance or materials coming from

outside. In addition to facilitating saving and credit, the groups have been used to initiate

and organize collective action towards solving different social problems of communities

(Benyam, 2009). In this context it is essential to assess the impact of SHG in reducing

poverty among urban women.

1.2. Statement of the Problem

The main development agenda of the Ethiopian government is poverty eradication. All the

country‟s development policies and strategies are, therefore, geared towards this end.

Effective implementation of these policies and strategies in an integrated and

7
comprehensive manner at various levels of government administration is key to

eradicating poverty and dependence on food aid in a shorter period of time. There is a

wide national consensus on the priority agenda of eradicating poverty and the policies and

strategies pursued to address such a development priority (GTP, 2010).

In general, the government can directly help those in need. However, another method in

helping women to fight poverty is through SHGs. SHGs tries to fight poverty and bring

opportunities to the poor women in many countries. Of course, microfinance approaches

in Ethiopia play their part in offering solutions to reduce poverty with tiny loans and

financial services; to help the poor mostly women start businesses and escape poverty. In

recent days SHGs have been considered as an alternative mechanism to reduce poverty in

addition to other interventions.

SHGs are small informal associations created for the purpose of enabling members to reap

economic benefit out of mutual help, solidarity and joint responsibility. The benefits

include mobilization of savings and credit facilities and pursuit of group enterprise

activities. The group based approach not only enables the poor to accumulate capital by

way of small savings but also help them to have access to formal credit facilities

(Shylendra, 1998). These groups by way of joint liability enable the poor to overcome the

problem of collateral security and thus free them from the clutches of moneylenders

(Stigliz, 1993). Besides, some of the basic characteristics of SHGs like the small size of

membership and homogeneity of composition will bring about cohesiveness and effective

participation of members in the functioning of the group. This is because according to

Donelson (2006) in order to be effective, group size should be kept to a minimum. Larger

groups increase the possibility of conflict due to the variety of viewpoints, few

opportunities for the development of social relationships, a decrease in participation levels,

and lack of opportunity for individual recognition and homogeneous groups are better for

8
exploitation and implementation of existing knowledge. In general, the SHGs created on

the above line of functioning have been able to effectively reach the poor, especially the

women, help them obtain easy access to facilities like savings and credit and in the long

run in reduction of poverty.

In the coming years and decades, urban poverty will become a major challenge for policy

makers in Hawassa city. As the urban population of the city is growing, so is urban

poverty. Poverty reduction tools and approaches that have been developed for rural

poverty reduction will not work in urban areas, because urban poverty is different in

nature from rural poverty. To address urban poverty effectively, policymakers in SNNPR

State and the city administration levels need a good understanding of the nature of urban

poverty as well as accurate data that present its dynamics, trends and conditions. The three

dimensions of poverty in Hawassa town are: Lack of regular income and employment,

productive assets (such as land and housing) and access to social safety nets.

According to Hawassa City Administration Department of Women, Children and Youth

Affairs, there is a need to have in depth study on the impact of SHG on urban women in

poverty reduction due to dearth of studies. Therefore, this research attempts to explore the

impact of SHGs on urban women in poverty reduction in Hawassa city.

1.3. Objectives of the Study

General Objective

The general objective of this study is to assess the impact that the involvement in SHGs

has brought to the urban poor women in poverty reduction in three selected sub cities of

Hawassa City.

Specific Objectives

 To find out the socio-economic impact of participation in Self Help Groups to

overcome urban women poverty in the study area.

9
  To identify the factors determining the participation of women in SHG.

 To study the factors determining the success of SHG.

1.4. Research Questions

The Research Questions formulated were:

1. Has participation in the SHG enhances the socio-economic status of urban poor

women?

2. Does participation in SHGs improve access to resources and participation in economic

decision making?

3. Does participation in Self Help Groups influence the individual skill development and

growth of women?

4. Does participation in SHGs increase women‟s awareness and knowledge regarding

saving and income generating activities?

5. What factors contribute women to participate in SHG and to the success of SHG?

1.5. Significance of the study

The valuable information generated through this study on poverty reduction among urban

poor women that may assist policy makers to understand the unique features of urban poor

women and help in designing appropriate policy for the interventions.

The findings of this study also believe to be useful to SHG‟s and stakeholders who involve

in SHG development to make informed decisions. The report will also serve as a reference

document for researchers to embark on studies of the same or related kind in other regions

of the country.

1.6. Scope and limitation of the study

The area considered for this study was restricted to Hawassa city only. Due to financial

and time constraints, all SHGs organized in SNNPR and other regions were not covered.

10
However, out of 136 SHGs in eight sub cities, the study covered 106 SHGs in three sub

cities of Hawassa city. In order to assess impact SHGs which are performed after the date

of establishment for three years or more was selected.

1.7. Organization of Thesis

This thesis comprised of five chapters. Chapter one deals with introduction to give

background information related to urban poverty and associated problems in Ethiopian in

general and particularly in Hawassa city; in addition, the necessity to assess the impact of

SHG in reducing poverty among urban women. Chapter two provides related literature on

concepts and definitions used and a brief description of available studies and empirical

studies. Chapter three describes about methodology that was used such as sampling

techniques, sample size, source of data and tools of data analysis and the like. The fourth

chapter presents the outcome of the study and elaborate discussion on that. The fifth

chapter deals with conclusion and recommendation on the ideas arise in every section of

the thesis.

11
 CHAPTER - II

LITERATURE REVIEW
2.1. Introduction

The purpose of this chapter is to provide a brief overview of some of the relevant literature

that has been useful in identifying possible research and implementation problem

statements. In addition, to provide a context for the research, justify the research, ensure

the research hasn't been done before, show where the research fits into the existing body of

knowledge, enable the researcher to learn from previous theory and or findings on the

subject, clarify how the subject has been studied previously, highlight flaws in previous

research, outline gaps in previous research, show that the work is adding to the

understanding and knowledge of the field, brief review of available literature has been

done and presented in this chapter.

2.2. Concept, Meaning and Definition of SHG

The concept of self-help groups gained significance, especially after 1976 when Prof.

Mohammed Yunus of Bangladesh began experimenting with micro-credit and women

SHGs. The strategy made a quick revolution in Bangladesh in poverty eradication 'by

empowering the poor women' (CIRDAP Digest, 2000). Prof. Dr. Muhammad Yunus came

up with a Group Lending Program known as the Grameen Bank (literally the Village

Bank) in Bangladesh. This was an experiment in giving credit to the very poor without any

collateral. Prof. Yunus reasoned that if financial resources can be made available to

millions of small people with their millions of small pursuits, it can add up to create the

biggest development wonder.

12
Ritu Jain (2003) conveyed that SHGs enhance the equality of status of women as

participants, decision makers and beneficiaries in the democratic, economic, social and

cultural spheres of life.

The approach of Self-help Groups (SHGs) towards poverty reduction is that it should be

self-help. The logic is that individual effort is too inadequate to improve their fate. This

brings about the necessity for organizing them in a group by which they get the benefit of

collective perception, collective decision making and collective implementation of

programs for common benefit (Karmakar, 1999).

Singh (1995) conceptualized as SHG as an informal association of individuals which

comes together voluntarily for promotion of economic and social objectives.

Dwaraki et al. (1996) described a self-help group as an unregistered body of people,

preferably the disadvantaged who are willing to contribute an agreed sum of money which

may be lent at a price for a short period fixed by the group itself.

As cited by Sowjanya (2007) and Roul (1996) SHG as a group where members come

together with certain objectives to manage their own funds and affairs by themselves to

achieve better control over their resources and to meet their credit needs.

SHG is a small economically homogeneous family group of the rural poor voluntarily

coming together to save small amounts regularly, which are deposited in a common fund

to meet members' emergent needs and to provide a collateral free loan decided by the

group (Jha, 2000).

Gupta (2006) explained SHG as a group of people that meets regularly to discuss issues of

interest to them and to look at solutions of commonly experienced problems. The group

may or may not be promoted by government or non-government institutions

13
Gangaiah et al. (2006) defined SHG as an informal association of 10-15 women who have

voluntarily come together for the business of saving and credit and it is a significant

instrument in the process of empowerment.

Devalatha C.M. (2005) defined Self-help groups as supportive educational and usually

change oriented mutual aid group that addresses life problems or conditions commonly

shared by all members. The purpose may be personal or for societal change or for both.

SHGs are small informal associations created for the purpose of enabling members to reap

economic benefit out of mutual help, solidarity and joint responsibility. The benefits

include mobilization of savings and credit facilities and pursuit of group enterprise

activities.

Aran (2007) defines SHG as a group of 10 to 20 people, usually women, from a similar

class and region, who come together to form savings and credit organization. They are

self-supporting self-governing organizations free from bureaucratization and politicization

and are based on principles of empowerment, inclusion, non-hierarchical decision-making,

shared responsibility, and a holistic approach to people's cultural, economic, and social

needs.

Sowjanya (2007) defines SHG as an informal association of 10-15 women, who have

voluntarily come together for the business of saving and credit and to enhance the

members financial security as a primary focus and other common interests of members

such as area development, awareness, motivation, leadership training and associating in

other social inter-mediation programs for the benefit of the group and the entire

community.

Thomas (1998) defined SHG as a homogenous group of rural poor voluntarily formed to

save small amount, out of their earnings which is convenient to all the members and

14
agreed upon by all to form a common fund corpus for the group and to its members for

meeting their productive and emergent credit needs.

According to Hawassa City administration Women, Youth and children's affairs (2011)

SHG is defined as a group of 12 -20 poor people with similar socio-economic background

who voluntarily agree to organize themselves in order to improve their living situation

with collective effort.

Objectives of SHG

1- To enable poor people in the community to be holistically self-sustainable by

providing basic technical support.

2- To help economically poor individuals in the community to develop self-

confidence and work ethics.

3- To support to meet their basic needs and commitment to be self-reliant.

4- To develop their participation and/or involvement in community matters or issues.

5- To obtain basic know how on the importance of Self Help Group on socio-

economic development of a given community.

There are three levels of SHG development the first one is Self Help Group which

comprises 12 – 20 individual members with similar socio-economic background, the

second level is SHG Cluster which encompasses 8 – 12 SHGs which are in the same area

and the third one is Federation which includes 8 – 12 SHG clusters.

Self-help Groups Cluster

SHG Cluster is an amalgamation of 8 to 12 SHGs that come together and form a union so

as to deal with and solve their collective problems, and represent SHGs in different

meetings whenever deemed necessary.

Objective of the SHG Cluster

 To solve problems that cannot be resolved at self-help grope level

15
  To form network with other organizations, enhance week groups, providing

consultancy and arbitration service and related services.

Federation

The Federation is the apex body of the People's Institution. At the formation stage, 8 to 12

Cluster Level Associations form a Federation. The chief mandate of the federation is to

take the responsibility of coordinating the groups through legal representation; organizing

corporate investment, facilitate further capacity building and networking with other bodies

to tap available benefit.

2.3. Urban Poverty and Vulnerability

According to Ethiopia Demographic and Health Survey 2011 (CSA, 2012) about one-

quarter (26%) of Ethiopian households are headed by women, a slight increase from 23

percent in 2005. Average household size is 4.6 persons, which is slightly lower than the

average of 5.0 persons per household reported in 2005. Urban households have fewer

members than rural households. In urban areas the average household size is 3.7 persons,

compared with 4.9 persons in rural areas. Single-person households are more common in

urban areas 17 percent than in rural areas 5 percent. Also, a much lower proportion of

urban households 19 percent have six or more members than do rural households 38

percent.

2.3.1. Poverty

Poverty is an ex-post measure of a household‟s well-being (or lack thereof). It reflects a

current state of deprivation, of lacking the resources or capabilities to satisfy current

needs. Vulnerability, on the other hand, may be broadly construed as an ex-ante measure

of well-being, reflecting not so much how well with a household currently is, but what its

future prospects are. What distinguishes the two is the presence of risk–the fact that the

16
level of future well-being is uncertain. The uncertainty that households face about the

future stems from multiple sources of risk–harvests may fail, food prices may rise, the

main income earner of the household may become ill, etc. If such risks were absent (and

the future is certain) there would be no distinction between vulnerability and poverty

measures of well-being (Shubham Chaudhuri, 2003).

There are no single “correct” definitions. However as we shall see, most researchers now

accept that any definition has to be understood, at least in part, in relation to particular

social, cultural and historical contexts? Thus have implications for studies that attempt to

compare poverty in every different kind of society (Ruth, 2004).

Poverty is a condition in which a person or community is deprived of, or lacks the

essentials for a minimum standard of well-being and life. Since poverty is understood in

many senses, these essentials may be material resources such as food, safe drinking water,

and shelter, or they may be social resources such as access to information, education,

health care, social status, political power, or the opportunity to develop meaningful

connections with other people in society (New World Encyclopedia, 2013).

It is a condition where people's basic needs for food, clothing, and shelter are not being

met (Business Dictionary, 2013). In economic terms, income poverty is when a family's

income fails to meet a federally established threshold that differs across countries.

Typically it is measured with respect to families and not the individual, and is adjusted for

the number of persons in a family. Economists often seek to identify the families whose

economic position (defined as command over resources) falls below some minimally

acceptable level. Similarly, the international standard of extreme poverty is set to the

possession of less than 1$ a day (UNESCO, 2013).

Frequently, poverty is defined in either relative or absolute terms. Absolute poverty

measures poverty in relation to the amount of money necessary to meet basic needs such

17
as food, clothing, and shelter. The concept of absolute poverty is not concerned with

broader quality of life issues or with the overall level of inequality in society. The concept

therefore fails to recognize that individuals have important social and cultural needs. This,

and similar criticisms, led to the development of the concept of relative poverty. Relative

poverty defines poverty in relation to the economic status of other members of the society:

people are poor if they fall below prevailing standards of living in a given societal context.

An important criticism of both concepts is that they are largely concerned with income and

consumption (UNESCO, 2013).

The concept of social exclusion emerged largely in reaction to this type of the narrow

definition of poverty. It has contributed significantly towards including multi-faceted

indicators of ill-being in the conceptual understanding of poverty. To further develop the

definition of the concept of relative poverty or relative deprivation, three perspectives are

relevant; the income perspective indicates that a person is poor only if his or her income is

below the country's poverty line (defined in terms of having income sufficient for a

specified amount of food); the basic needs perspective goes beyond the income

perspective to include the need for the provision by a community of the basic social

services necessary to prevent individuals from falling into poverty; and finally, the

capability (or empowerment) perspective suggests that poverty signify a lack of some

basic capability to function. (ibid)

Social scientists' understanding of poverty, on the other hand, is critical of the economical

idea of free choice models where individuals control their own destiny and are thus the

cause of their own poverty. Rather than being interested in its measurement, sociologists

generally study the reasons for poverty, such as the roles of culture, power, social structure

and other factors largely out of the control of the individual. Accordingly, the

multidimensional nature of poverty, in particular social aspects such as housing poor,

18
health poor or time poor, needs to be understood in order to create more effective

programs for poverty alleviation. Hypotheses that typically play a role in sociological

theories of poverty are based on the idea that individuals are influenced by the physical

and cultural context in which they live, and it gives importance to gender and household

structure (UNESCO, 2013).

Today it is widely held that one cannot consider only the economic part of poverty.

Poverty is also social, political and cultural. Moreover, it is considered to undermine

human rights - economic (the right to work and have an adequate income), social (access

to health care and education), political (freedom of thought, expression and association)

and cultural (the right to maintain one's cultural identity and be involved in a community's

cultural life). The Millennium Development Goals global targets that the world's leaders

set at the UN Millennium Summit in September 2000 - are an agenda for reducing

poverty, its causes and manifestations. As part of the goal of eradicating extreme poverty

and hunger, United Nations Development Program (UNDP) seeks to halve, between 1990

and 2015, the proportion of people whose income is less than 1 $US a day. (ibid)

Abdullah (2010) explained that poor people are suffering day and night from the physical

pain that is resulted from too little food with long hours of work; psychological pain

originates from the ongoing humiliations of dependency and lack of power; and the ethical

pain to make a forced choice between either to save their life or their children‟s life with

no money to save any one of them. They live without any freedom of choice of action to

make a difference. There is no such life with lack of food and shelter, health and

education, all of these fundamentals of life that everyone values. Poor people are lonely

facing the extreme vulnerability to ill health, economic dislocation, and natural disasters.

Poverty is defined by the World Bank as hunger, lack of shelter, being sick and not being

able to see a doctor, is not having access to school and not knowing how to read, is not

19
having a job, is fear for the future, living one day at a time, is losing a child to illness

brought about by unclean water, is powerlessness, lack of representation and freedom.

2.3.2. Poverty: prevalence of illness, water and sanitation

According to UN-HABITAT (2011) report despite the significant progress made towards

drinking water targets, the world is far from meeting the sanitation target. In fact, at the

current rate of progress, the report says it will take until 2049 to provide 77 percent of the

global population with flush toilets and other forms of improved sanitation. Almost half

the populations of developing regions and some 2.6 billion people globally were not using

an improved form of sanitation in 2008. That year, an estimated 1.1 billion people did not

use any facility at all and practiced open defecation, which poses enormous health risks,

particularly for the poorer segments of the population who are most exposed to the

dangers of inadequate human waste disposal. Globally, open defecation rates have

declined by one third, from 25 percent of the population in 1990 to 17 percent in 2008.

Almost two thirds of the people who practice open defecation reside in Southern Asia.

Northern Africa is the only region that has already surpassed the MDG sanitation target,

increasing coverage from 72 percent in 1990 to 89 percent in 2008.

While problems related to sanitation and water is closely linked, today more than twice as

many people lack safe sanitation versus those who lack safe water. Nonetheless, the

problem of poor sanitation has not received the same level of attention and funding as

water, and our new strategy will enable the foundation to play a potentially catalytic role

in the field. Improved sanitation can have a significant impact on the lives of millions of

people worldwide. By one estimate, safe sanitation has increased the average lifespan in

the world‟s richest nations by 20 years. Access to safe sanitation can reduce child diarrhea

by 30 percent and significantly increase school attendance. An unsafe method to capture

and store waste produces serious health problems and death. About 1.5 million children

20
die each year from diarrheal disease, and most of these deaths could be prevented by the

introduction of proper sanitation, along with safe drinking water and improved hygiene to

UN-HABITAT (2011).

According to Ethiopian Welfare Monitoring Survey (WMS) (2011) summery report 16.9

percent (13.0 million persons) reported that they had health problems at least once over the

two month period prior to the date of interview. It was 23.8 percent (15.4 million) in the

2004. This incidence is slightly higher among rural population than urban. Around 17.2

percent of the rural population had reported illness during the reference period compared

to 15.5 percent of urban residents which was 17.2 & 15.5 percent in the year 2004 survey.

The results of the 2011 WMS, also, revealed evidence of slight sex disparity with respect

to the incidence of illness. At country rural and urban level, the less proportion of the male

population compared to the female are reported to have health problem during the

reference period.

The survey result showed that at country level only 61.9 percent (8.1 million persons) of

the population who had health problem had consulted for treatment. More than half of the

population who reported to have a health problem (most of whom are rural residents) did

not consult for treatment. Only 59.47 percent of the rural population who reported health

problem consulted for medical assistance compared to 75.3 percent of the population in

urban areas. The observed higher consultation rates in urban areas compared to rural areas

could be an indication of the limited access to health services in rural areas (CSA, 2012).

Many key indicators of multidimensional poverty are related to housing and housing

facilities. Access to safe drinking water is one of them. Safe water may mean a tap inside

the house or in the compound, private, shared or communally, water purchased from a

kiosk or acquired from a protected private or shared well. Unsafe water means unprotected

well, water from a river, lake or pond or other unspecified sources. The proportion of

21
urban housing units using safe drinking water increased from 83.5 percent to about 95.0

percent in 2011. This shows that there is a positive change regarding the provision of safe

drinking water supply in urban areas of the country (CSA, 2012).

Along with the provision of safe drinking water, efficient management of human waste is

one of the indicators of the well-being of the household and of utmost importance to basic

health standards of home. The WMS questionnaire includes five types of toilet facilities

including flush toilet, pit latrine (ventilated), pit latrine (not ventilated), bucket and

field/forest. The survey results show that 66.0 percent of the housing units in Ethiopia had

toilet facility. About 87.0 percent of housing units in urban Ethiopia had a toilet facility as

compared to 60.0 percent of the rural housing units. The majority of the housing units uses

pit latrine (64.0%) at country level. Only about 2.0 percent of the households used the

flush toilet. (ibid)

2.3.3. Poverty indicated by the source of energy for lighting and cooking

The source of energy for lighting used by housing units partly determines the quality of

the living environment besides giving important information about housing quality.

Housing units use various forms of energy for lighting. The 2011 Welfare Monitoring

Survey (WMS) data show that 23 percent the source is electricity, 52 percent kerosene, 13

percent electricity from the battery and 11percent it is firewood. The data further show that

housing units in urban areas of the country were more likely to have electricity as a main

source of energy for lighting 88.0 percent compared to their rural counterparts 5.0 percent.

The data also show that 70.0 percent of the housing units in urban areas used electricity as

the main source of lighting in 2000, which increased to 75.3 percent in 2004 and 88.0

percent in 2011. At country level, about 85.0 percent of the households use firewood

cooks their food. Around 5.1 percent of them cook their food by using dung/manure and

only 1.2 percent of the households use kerosene for cooking. In the urban area about 63.3

22
percent of the households used firewood as the main source of fuel for cooking. On the

other hand, 17.5 percent of the housing units in urban areas used charcoal as the source of

fuel for cooking (CSA, 2012).

2.3.4. Poverty as related to housing Ownership

According to the 2011 Welfare and Monitoring Survey (WMS), in Ethiopia about 8 out of

10 housing units were owner occupied, with higher percentages in rural areas (96.0%) than

in urban areas (43%). The rental housing was more prevalent in urban (50.0%) than rural

areas (2.0%). As expected, most households residing in urban housing units were renters.

Housing conditions vary greatly based on the number of rooms. More than half of the total

households (51.0%) reside in single-room houses and 31.0 percent of the households live

in dwelling units that have two rooms. About 18.0 percent households live in dwelling

units that have three or more room‟s houses (CSA, 2012).

2.3.5. Urban Poverty

The report Global Urban Poverty: Setting the Agenda, (USAID, 2007) revealed that One

billion people one-third of the world‟s urban population currently live in slums. In cities

across the globe, hundreds of millions of people exist in desperate poverty without access

to adequate shelter, clean water, and basic sanitation. Overcrowding and environmental

degradation make the urban poor particularly vulnerable to the spread of disease.

Insecurity permeates all aspects of life for slum dwellers. Without a land title or tenure,

they face the constant threat of eviction. Crime and violence are concentrated in city

slums, disproportionately affecting the urban poor. Most slum dwellers depend upon

precarious employment in the informal sector, characterized by low pay and poor working

conditions. Illegal settlements are often located on hazardous land in the urban periphery.

Perhaps most alienated in city slums are growing youth populations whose unmet needs

23
for space, education, health, and jobs can lead to social problems, further undermining

security in urban areas.

Elisa Muzzini (2008) pointed out in her paper on “Urban Poverty in Ethiopia, Multi-

faceted and Spatial Perspective” that the specific character of urban poverty may be

related to three distinctive characteristics of urban life: commoditization, environmental

hazard, and social fragmentation. Commoditization is one set of risks faced by urban

dwellers arises from their integration into the cash economy. Urban households are for the

most part obliged to pay for their food and shelter (rather than rely on their own

production), and may be more dependent upon purchasing services such as transportation

and education than rural dwellers. Employment is frequently unavailable, insufficient, or

insecure. The shelter has been frequently illegal and insecure. Furthermore, sections of the

urban poor may be particularly vulnerable to economic shocks, and to macroeconomic

policy adjustments in prices, wages, and public expenditure, Environmental hazard: the

poor are disproportionately affected by urban environmental problems. Special

characteristics of low-income communities include: (a) inadequate access to

environmental services (water, sanitation, drainage, and solid waste management); (b)

poor quality housing; (c) overcrowding; and (d) settlement on marginal or degraded land.

These factors increase health risks to the poor, with corresponding economic costs for

health care and lost or lowered productivity. Social fragmentation: The vulnerability of

urban dwellers may also be high because community and inter-household mechanisms for

social security are less likely to operate in urban than in rural areas. Urban areas are often

characterized by higher levels of violence, alcohol, and drug abuse, and greater risk of

motor vehicle accidents.

According to the working paper on “Urbanization, gender and urban poverty: paid work

and unpaid care work in the city” (UNFPA, 2012) the urban poor also often have to pay

24
more for water. In informal settlements, access to piped water is limited and residents

must purchase from private vendors who often control standpipes. Many of them also have

to pay for access to latrines where they exist, and lack of sanitation in high-density

settlements increases health risks. Inadequate drainage increases the risk of floods, and

stagnant water encourages the breeding of parasites. Inadequate management of solid

waste contributes to the degradation of the local environment, with negative impacts on

the health of the most vulnerable groups such as children and older people.

An emphasis on the non-income dimensions of urban poverty engages with the non-cash

economy in other words, in those typically unpaid activities such as caring and social

reproduction which are usually associated with women‟s responsibilities. For example,

poor housing conditions, distance from health services and schools, unsafe neighborhoods

(because of both environmental hazards and high rates of crime and violence), and limited

access to water and sanitation put an additional burden on those who, within households,

are responsible for childcare, food preparation, cleaning and washing. At the same time,

however, income poverty also means that women (often at a very young age) need to

engage in the cash economy, often in the lowest paid formal- and informal sector

activities. As a result, women‟s days may involve as many as 17 hours working within and

outside the home (Chant, 2007). Time poverty and the related emotional stress are an

important and specific gendered element of multi-dimensional poverty (Gammage, 2010).

2.4.6. Urban Unemployment

The 2011 Ethiopian Demographic and Health Survey (EDHS) reports shows that the

proportion of women currently employed rose from 27 percent among women age 15-19

to a peak of 44 percent among women age 25-29 and then declines slightly for the older

age groups. By marital status, women who are divorced, separated, or widowed are most

likely to be currently employed (51%). There are notable variations in the proportion

25
currently employed by place of residence and by region. Urban women are more likely to

be currently employed than rural women (50 percent compared with 34 percent). The

same survey revealed that in SNNPR 40.7 percent of women are currently employed, 14.5

percent of women are not currently employed.

2.4. Vulnerability

According to the working paper of Carrolin M. et al. (1996) on urban management and

poverty reduction explained that the concept of vulnerability captures some of the

multidimensional, dynamic and structural aspects of poverty. Vulnerability denotes not

simple lack or want, but "defenselessness, insecurity, and exposure to risk shock and

stress" The poor are disproportionately affected by urban environmental problems. Special

characteristics of low-income communities include: (a) inadequate access to

environmental services (water, sanitation, drainage, and solid waste management); (b)

poor quality housing; (c) overcrowding; and (d) settlement on marginal or degraded land.

These factors increase health risks to the poor, with corresponding economic costs for

health care and lost or lowered productivity. The vulnerability of urban dwellers may also

be high because community and inter-household mechanisms for social security are less

likely to operate in urban than in rural areas. Urban areas are often characterized by higher

levels of violence, alcohol, and drug abuse, and greater risk of motor vehicle accidents.

2.5. Empirical Studies

Impacts of Self Help Groups in Reduction of urban women's poverty were assessed by

researchers and some important regional, national and international studies are presented

here.

26
Awareness increase due to Participation in SHG

Brinda (2013) concluded that confidence to start own enterprise, develop awareness,

leadership quality, decision making ability showed a positive attitude in the individual

empowerment due to the participation in SHG. It has been inferred that the social

empowerment definitely had been improved through the self-help group activities in social

life.

Chandralekha G. and Tanmoyee B.(2010) concluded that SHGs are helping the

respondents to know about the present political system. Majority (78%) of respondents

have opined that their political knowledge is improved after joining SHGs. It reveals that

SHGs are playing a vital role in giving awareness about the political system to its

members.

According to Jaya (2004) due to participation in SHG 54 percent were well informed of

health and family welfare programs and majority (91%) learned about the banking system

after joining the group and were confident of going to the bank for transacting business.

Socio-economic Impact of SHG

Sumitra Bithi Kachari and Dukhabandhu Sahoo (2008) conclueded that SHGs are

functioning well in organizing the poor women's section into a self-serviced economic

forum.

According to Chandralekha G. and Tanmoyee B.(2010) majority (94%) of the respondents

are influenced by SHGs in their day-to-day behavior and 96 percent interpersonal

relationship has been changed positively after joining SHGs. In addition and all (100%) of

SHG members level of confidence has been significantly increased after joining SHG.

Dabali S. D. (2010) detailed that all members‟ were aware as regards to their Group‟s

objectives, rules and regulations and also in participating in their Groups‟ meetings. Most

of the members (91%) provided problem solving inputs. Awareness about the quantum of

27
personal savings, loans etc. among members with the SHG were also high (97.55%) while

comprehension of SHG‟s financial position was lower (93.25%). Larger affirmative

responses were recorded as to the members‟ ability to transact SHG‟s bank dealings and

conduct SHG meetings (91.41%), maintain accounts (67.48%). SHG interest was lower

and SHG had augmented existing income was iterated by 63.19 percent and 44.83 percent

of the members respectively. More than 90 percent of the members refuted that SHGs had

added new employment or incomes to their family.

MYRADA (2002) discovered that 89 percent interviewees agreed that their financial

position had changed for the better. More members in the older groups than in the younger

groups reported a positive influence on their share in the family income during this period.

In the old Group, more members reported a positive influence on confidence level in

dealing with people and institutions. The old Group had a substantially larger percentage

of respondents reporting an increase in awareness about health and hygiene. Over 95

percent old Group members say that they run their accounts often. More old Group

members said that their control over their own lives had improved. Also, more old Group

members said that they decided on the matters concerning to the general welfare of the

family.

Sundaram A. (2012) concluded that SHG Program clearly plays a central role in the lives

of the poor. There is evidence of increased household income. Standard of living in the

program participants has increased and also the food security is much more for the

program clients. Program loans are one of the main ways clients overcome food insecurity

with sickness, disease, emergencies and crises. The Self Help Groups have proved the way

for the economic independence of rural women.

28
Factors Determining Participation in SHG

Amutha D. (2011) conducted a study with an objective to find out reasons for joining SHG

and pointed out that 85.3 percent of women stated that the most important motivating

factor to join the SHG was to supplement their family income. It also reveals that there is

definite growing awareness in society and women in particular that if the family has to

maintain a reasonable standard of living, women should supplement to family income with

whatever skill they have 8.8 and 5.9 percent of them stated that they join the SHG because

they were bored at home and to provide a better life for their children, respectively.

Singh Y.K., et.al (2007) concluded that almost all the group characteristics had positive

and significant relationships. The SHGs followed normal patterns of group behavior. A

greater percentage of women were impacted positively by being members of SHGs.

Women's participation in SHGs enabled them to discover inner strength, gain self-

confidence, social and economic empowerment and capacity building. Women also gave

suggestions for strengthening their groups and actively participated in them.

Sanjay K. D. (2012) reported that factors influencing SHG members are borrowings from

Various Funds and age Groups the study proceeds to find out what factors influence their

membership in SHGs, which is analyzed by considering their borrowings from various

funds. It was observed that age and educational level of SHG members are the main

factors that influence the borrowings. It is also concluded that education is not an

influencing factor as regards borrowings either from internal and revolving funds.

According to Randhawa V. and Sukhdeep Kaur Mann (2007) majority (95%) of the

respondents reported that they joined the group for „availing subsidy‟ whereas 57.64

percent of the respondents joined the SHGs for „availing loan‟. Higher percentage of

respondents was motivated by subsidy as the government.

29
Chandralekha G. and Tanmoyee B.(2010) found out that the majority of the respondents

(54%) joined SHGs in order to save money.

Factors Determining the Success of SHGs

Sowjanya (2007) concluded while comparing successful and unsuccessful SHGs in Gadag

District of Karnataka that the performance of unsuccessful SHGs, was low because of low

attendance, irregular contribution, low transaction with banks, few members taking

decisions, irregular loan repayment, poor record maintenance.

Singh Y.K., et al. (2007) concluded that the positive and significant relationship of group

process with participation, task function, maintenance function, interpersonal trust and

group cohesiveness, shows that groups are going in the right direction. These group

characteristics must be present for effective and proper functioning of SGHs.

According Gurupandi M. (2012) factors responsible for the effective function for the

SHGs were grouped in such a way that Guidance of NGO‟s ranks as the first important

factor with high factor loading. The second factor is Effective functioning of SHG and the

third factor was Creation of women empowerment and concluded that the women

empowerment has been created with the help of SHG‟s in the study area and it had

become as the third important factor.

According to Joy, et al (2008) the performance of SHGs is influenced more by the

experience indirectly captured by the age rather than the education level. It is revealed that

group stability is influenced by factors like group cohesion, group leadership, team spirit,

group decision making and regularity in maintenance of records.

Change Due to access to resources, information and Decision making

Shreedevi S. (2012) conducted a study with objectives to find out SHGs supported income

generating activities on improving the economic conditions of the members of self-help

groups and concluded that the real empowerment of women is possible only when a

30
woman has increased access to economic resources more strength and course for entering

into the power structure more involvement through social relationship and participation

more self-motivation and confidence.

Manimekalai and Rajeshwari (2001) highlighted that the provision of micro financing by

the NGO's to women SHGs, has helped the groups to achieve a measure of economic and

social empowerment. It has developed a sense of leadership, organizational skills,

management of activities of businesses, establishing adequate financing, identifying raw

material, market and suitable diversification and modernization.

Bezabih Tolosa (2007) concluded that after being involved in SHG, the respondents‟

families‟ expenditure capability on family food, clothing, utilities, and children‟s

education has increased.

Bharath R.A (2005) reported that majority (95%) of the respondents income has increased

after joining SHG. The percentage score of confidence to talk within the family was 43.5

percent before joining SHG and increased to 88.6 percent after joining SHG. With respect

to decision making pattern in the family, the decisions taken by the SHG members during

the family and social functions accounts to 41.0 percent before which increased to 88.8

percent after joining the project.

Having the knowledge base about SHG from the preceding literature review, the major

concern behind this study is to ascertain whether the above mentioned major social and

economic benefits gained by being member of SHG exist in the situation of women

beneficiaries in Hawassa city. In addition, with this background, the present study was

undertaken to identify the impact of SHGs in reduction of urban women poverty, factors

determining the participation of women in SHGs and the changes due to participation of

SHGs and factors that determine the success of SHGs in the study area.

31
 CHAPTER - III

METHODOLOGY

This chapter presents an outline of the research design of the present study, which includes

a description of the study area, the sampling techniques, source and type of data and the

techniques used in analyzing the collected data.

3.1 Description of the Study Area

Hawassa is found in the Southern Nations, Nationalities and People's Regional State

(SNNPR) of Ethiopia. Based on the result of housing and population census of May, 2007

in 2003 EC (2011/12 GC) the projected population of Hawassa city administration reaches

304,479 people, out of this 156,675 are male and 147,084 are female. Out of the number

of the population of the city‟s administration 191,817 people live in urban out of these

total urban dwellers women age 12-49 are 62,473, while the remaining 112,662 people

live in the rural area of the administration. Hawassa city administration urban area is

divided into 8 sub cities namely Addis ketema with a total population 21,276, Hayek Dar

with a total population 21,276, Mehal Ketema with a total population 17,922, Bahil

Adarash with a total population 18,177, Misrak with a total population 28,399,

Menahariya with a total population 29,993, Tabor with a total population 53,341 and

Tulaa Town (Kebele 01) with a total population 890.

SHGs in Hawassa are organized and supported by governmental and non-governmental

organizations. According to the data collected by the Hawassa City Administration

Department of Women, Children and Youth Affairs there are 136 Women Self Help

Groups with a total number of 2,308 members in 8 sub cities.

All SHGs in selected three sub cities were organized by Integrated Urban Development

Department of the Ethiopian Kale Hiwot Church (IUDD-EKHC) and Bright Image for

32
Generation (BIGA). IUDD-EKHC introduces the concept SHG in Ethiopia in 2002 first in

Adama then to Addis Ababa, Hawassa and Jima. IUDD-EKHC has worked in Hawassa

city for more than 10 years in organizing SHG. IUDD-EKHC is a faith based organization.

Bright Image for Generation (BIGA) is an indigenous, non-partisan, non-profit

organization established by a group of volunteer and philanthropic professionals to serve

vulnerable groups in the Southern Nations, Nationalities and Peoples Region (SNNPR) of

Ethiopia. Bright Image for Generation (BIGA) has commenced Community Development

Project, whereby many of the poor, among which the majorities are women, will benefit.

The project has committed itself to the facilitation of SHGs, and provision of various

technical assistances to the groups, so that they can develop properly.

33
 Figure 3.1. Map of the study area Hawassa City

Map of SNNPR

Map of
Hawassa

Source: SNNPR Education Bureau (http://www.snnpreb.gov.et Accessed March 13, 2013)

and Google earth 2013 (www.googleearth.com Accessed March 13, 2013)

34
3.2 Sampling and Sample Size

Multistage sampling procedure has been adopted to select the sample sub cities, SHGs and

the members. In the process of sampling, Hawassa city is divided into 8 sub-cities and 32

kebeles. Among the 8 Sub cities 3 sub cities were selected purposefully due to the high

concentration of SHGs compared to other sub cities. Since, the study has been related to

assessing the impact of SHGs in urban women poverty reduction, the SHGs which were

established more than 3 years were considered for the sample selection. Thus, there were

86 SHGs functioning more than three years in selected sub cities. From this, due to time

and financial constraints 30 percent (26) SHGs were selected by using proportional

random sampling techniques from each sub cities. The sample members of the selected

SHGs were selected by using the following formula.

SS =

Z= Z-value (2.576 for 99% confidence level)

P= percentage picking a choice, expressed as decimal (0.5 used for sample size needed)

C= confidence interval, expressed as decimal (e.g. 0.1= )

Pop= Population

SS =

SS= 165.89

New SS =

New SS=

New Ss = 121

35
Accordingly 121 members have been identified proportionate to the from sample SHGs. In

addition one focus group discussion (FGD) with 3 project facilitators and 3 community

workers and key informants‟ interview with 52 SHG coordinators 2 from each 26 SHGs

was also conducted.

Table 3.1. SHGs in the Selected Sub-cities and number of sample respondents
from each SHGs
Number Number of
Sub- Year of
Name of Women SHG of respondents from
cities Establishment
Members each SHG
Tigat Newina Habte 14 2005 4
Siraw Dink 16 2009 4
Wrikama Tesifa 10 2007 4
Mehal Ketema Sub City

Fison 16 2004 5
Egiziabiher Balew 17 2006 5
Yenege Sew 16 2008 5
Yehiwe Nesi 19 2005 4
Tinsae 16 2005 4
Maranatha 16 2005 4
Girum 18 2006 5
Behibret Enidag 18 2005 5
Gedeb 14 2006 4
Geta Yirdan 16 2005 4
Total 206 57
Abenezer 20 2009 5
Hayik Dar

Selam 20 2009 5
Sub City

Biruh Tesfa 13 2009 5

Lemilem Group 1 20 2009 5
Total 73 20
Kalkidan 18 2005 5
Addis Ketema Sub City

Ende Fekadih Yihun 20 2004 5

Yakebiral 18 2006 5
Liyu Ediget 16 2008 5
Ephirata 20 2006 5
Esu balew 19 2003 5
Eminet Sira 12 2004 5
Wog Ayen 19 2006 5
Anten Amigne 20 2005 4
Total 162 44
Source: Hawassa City Administration Women, Children and Youth Affairs.

36
 Table 3.2 Sampling and Sample Size Summery
Number of Number of
30% selected
SHGs Members of
Sr. Selected Sub Number SHGs which Sample
which are 3 in the
No. Cities of SHGs are 3 years and respondents
years and selected
above
above SHGs
1 Mehal Ketema 53 42 13 206 57
2 Addis Ketema 31 31 9 162 44
3 Hayike Dar 22 13 4 73 20

Total 106 86 26 441 121

Source: Hawassa City Administration Women, Children and Youth Affairs.

3.3 Source and type of Data

In order to assess the impact of SHGs in urban women poverty reduction information

related to demographic, economic, social, and political, access to resources and

involvement in skill development primary data was collected from sample respondents.

3.4 Method of data collection

Based on the variables identified in the study and to collect the data focus group

discussion and structured interview schedule for the sample respondents was framed. The

structured interview schedule for the sample respondents was pre-tested and based on the

responses; the schedule was further modified and finalized. Data collection tools were

prepared in English and then translated into Amharic. Primary data collection was

conducted in Amharic. Six enumerators were hired and trained for primary data collection

and the researcher was closely monitoring the data collection.

3.5 Method of data analysis

The data collected from the field was processed and analyzed by using SPSS version 20

packages to address the objectives.

To assess the increase of awareness due to SHG participation basic statistics such as

averages and percentage analysis were carried out to draw a meaningful interpretation of

the results. In order to find out the impact of participation in SHG to overcome women's

37
poverty in the study area, paired T-test was applied in order to assess the socioeconomic

status of sample respondents before and after joining SHG.

To identify the factors determining the participation of women in SHG average and

percentage analysis was carried out to draw a meaningful interpretation of the results. To

analyze the reasons for joining the group by the member, all the possible reasons were

explored from the members of self-help groups. They were asked to rank the reasons in

the order of their importance. The ranks given by them were quantified using the Garrett

Ranking Technique (Garrett, 1969) as follows:

Where,

Rij = Rank given for the ith item by the jth individual, and

Nj = Number of items ranked by the jth individual.

To assess the changes takes place among women through access to resources and

influence in decision making due to the membership in SHGs; Likert‟s five scale

measurement tools were framed and percentage analysis was applied to assess changes

due to membership in SHG.

In order to determine the factors determining the success of SHG, factor analysis was

carried out. The variables considered in this analysis were number of members, Age,

regular meeting per month, loan, clear all debts up to now, capital at establishment, current

capital, other business services in the same area, members saving culture, teamwork,

attitude towards self-employment, managing conflict, group decision making, financial

support from any NGO, non-financial support from voluntary individual, non-financial

38
support from NGO, non-financial support from government, non-financial support from

other SHGs, educational status.

3.5.1. Factor analysis model description

Factor analysis addresses the problem of analyzing the structure of the interrelationships

(correlations) among a number of variables by defining a set of common underlying

dimensions, known as factors.

Factor analysis differs from the dependence techniques e.g. multiple regressions, in which

one or more variables are explicitly considered the criterion or dependent variables and all

others are the predictor or independent variables. Factor analysis is an interdependence

technique in which all variables are simultaneously considered, each related to all others.

Mathematically, each variable is expressed as a linear combination of the underlying

factors. The amount of variance a variable shares with all the other variables included in

the analysis is referred to as communality. The co-variation among the variables is

described in terms of a small number of common factors together with a unique factor for

each variable. These factors are not over observed. If the variables are standardized, the

factor model may be represented as:

Xi = Aij F1 + Ai2 F2 + Ai3 F3 + …… + Aim Fm + ViUi

Where,
Xi = ith standardized variable,
Aij = Standardized multiple regression coefficient of variable „i‟ on common factor „j‟
F = Common factor,
Vi = Standardized regression coefficient of variable „i‟ on unique factor „i‟
Ui = The unique factor for variable „i‟
m = Number of common factors
The unique factors are uncorrelated with each other and with the common factors. The
common factors themselves could be expressed as linear combinations of the observed
variables.
Fi = Wi1 Xi + Wi2 X2 + Wi3 X3 + …. + Wik Xk

39
Where,
Fi = Estimate of ith factor
Wi = Weight or factor score coefficient
K = Number of variables.

Means of Interpreting Factors

Factor loading is the means of interpreting the role each variable plays in defining each

factor. Factor loadings are the correlation of each variable and the factor. Loadings

indicate the degree of correspondence between the variable and the factor, with higher

loadings making the variable representative of the factor.

The factor matrix contains factor loadings for each variable on each factor. In computing

the unrotated factor matrix, the researcher is simply interested in the best linear

combination of variables best in the sense that the particular combination of original

variables accounts for more of the variance in the data as a whole than any other linear

combination of variables. Therefore, the first factor may be viewed as the single best

summary of linear relationships exhibited in the data.

An important tool in interpreting factors is factor rotation. Specifically, the reference axes

of the factors are turned about the origin until some other position has been reached. As

indicated earlier, unrotated factor solutions extract factors in the order of their importance.

The first factor tends to be a general factor with almost every variable loading

significantly, and it accounts for the largest amount of variance. The second and

subsequent factors are then based on the residual amount of variance. Each accounts for

successively smaller portions of variance. The ultimate effect of rotating the factor matrix

is to redistribute the variance from earlier factors to later ones to achieve a simpler, more

meaningful factor pattern.

40
It is a rule of thumb used frequently as a means of making a preliminary examination of

the factor matrix. In short, factor loadings greater than ±0.30 are considered to meet the

minimal level; loadings of ±0.40 are considered more important; and if the loadings are

±0.50 or greater, they are considered practically significant. Thus, the larger the absolute

size of the factor loading, the more important the loading in interpreting the factor matrix.

Because factor loading is the correlation of the variable and the factor, the squared loading

is the amount of the variable's total variance accounted for by the factor. Thus, a 0.30

loading translates to approximately 10 percent explanation, and a 0.50 loading denotes that

25 percent of the variance is accounted for by the factor.

3.5.2 Variable definitions

The outcome of factor analysis for the present study is factors that determine the success

of SHG. The predicators included in this analysis are as follows:

Number of members (X1) : - It is the total participants in SHG. As the total participants

smaller it may be easier to solve problems, manage issues such as conflict and to give a

chance to every member to participate in the decision making process. Thus, it is assumed

that the number of members and success of SHG has a direct relationship.

Age (X2 ): - It is the number of years reported to have been completed by the respondent at

the time of interview. Mental ability and personal job performance are affected by age that

may directly impact learning new skills and productivity. As people getting older their

mental ability to learn and acquire new skills may decline that may affect productivity

negatively. Therefore, it is hypothesized that age has a direct impact on the success of

SHG.

Regular meeting per month (X3 ): - It is a frequency of gathering of SHG members to

discuss issues and make group decisions within a month. Regular meetings enhance group

cohesiveness, group stability and promote ownership of SHG. It is assumed that regular

41
meeting contribute to the effective group functioning of SHG member. Thus, regular

meeting contributes positively to the success of SHG.

Loan (X4): - It is borrowing money with interest. This money may be used as capital to

start a new business or to improve the existing business in order to get more income. It is

assumed that loan can create an opportunity for SHG members to increase their capital and

easily tackle their personal or family problems. Therefore, loan and the success of SHG

have a positive relationship.

Clear all debts up to now(X5): - It is the number of times that loan is returned with the

principal value and interest. Loan recovery is one of the key indicators of the efficient

functioning of SHG. Hence, clear all debts are hypothesizing that it has a positive relation

to the success of SHG.

Capital at establishment (X6): - it is cash or goods used to generate income either by

investing in a business or income generating activities at the establishment SHG. Business

success is may be determined by the amount of capital at the establishment. Thus, it is

assumed that the amount of cash or goods that SHGs get at the establishment of the group

may have a positive relation with the success of SHG.

Current capital: (X7) - it is cash or goods which can be used to generate income by

investing in a business. The amount of current capital is an indicator of the effective

performance of SHG. Therefore, it is assumed that current capital and success of SHG

have positive relationship.

Other business services in the same area (X8): - It is a business competition within the

same market. If same business services are available more than the demand, that may be a

reason for business failure. Therefore, it is assumed that other business services in the

same area negatively affect the success of SHG.

42
Members saving culture (X9): - It is the habit of SHG members to preserve the portion of

income not spent on consumption of consumer goods but accumulated or invested directly

in capital equipment. Members saving culture may contribute positively to future

investment and to survive bankruptcy. Therefore, it is assumed that SHG members saving

culture have a positive relationship with the success of SHG.

Teamwork (X10): - It is SHG members‟ willingness and ability to work together aimed at

achieving the common goal. Teamwork fosters cooperation and collective effort that may

lead to success. Therefore, teamwork is hypothesized that it has a direct relation to the

success of SHG.

Attitude towards self-employment (X11): - It is the perception of SHG members towards to

start one‟s own business. There is a significant relationship between attitude towards self-

employment and one‟s own business success. Therefore, it is assumed SHG members'

attitude towards self-employment have a positive relationship to the success of SHG.

Managing conflict (X12): - It is the practice of recognizing and dealing with disputes in a

rational, balanced and effective way. Disputes are common in SHGs for that reason

conflicts have to be managed well to function as a group. Therefore, managing conflict has

a positive relationship to the success of SHG.

Group decision making (X13):- it is a process of participating all members of SHG in

decision making. Since all SHG members possess the essential ingredients for the

solutions to problems, group decisions should be based on all members' input. Therefore,

it is assumed that group decision making has a positive relationship to the success of SHG.

Financial support from any NGO (X14): - it is a monetary assistance from NGOs to

SHGs. Financial support from NGOs to SHGs most of the times are used as seed money or

initial capital for the group to support its members to start income generating activities.

43
Thus, it is assumed that financial support from NGO has a positive impact on the success

of SHG.

Non-financial support from voluntary individual (X15): - It is a non-monetary assistance

such as technical support (record keeping, business plan preparation), provide guidance,

information, sharing business ideas and so on from voluntary individuals. Volunteers can

provide their skills, knowledge to SHG that may contribute to their success. Therefore, it

is assumed that non-financial support from voluntary individual has a direct relationship

with the success of SHG.

Non-financial support from NGO (X16): - It is a non-monetary assistance such as

technical support (record keeping, business plan preparation), provide guidance,

information, sharing business ideas, provision of various trainings and so on from NGOs.

It is well known that technical support (record keeping, business plan preparation),

guidance, information, business ideas, provision of various trainings are the bases of

success of most businesses. Therefore, it is assumed that non-financial support from NGO

has a direct relationship with the success of SHG.

Non-financial support from government (X17): - It is a non-monetary assistance such as

provide guidance, information, sharing business ideas, provision of market place, legal

registration and protection and so on from government. It is obvious that Non-financial

support from government contribute for the success of any business. Therefore, it is

hypothesized that non-financial support from the government positively affects the success

of SHG.

Non-financial support from other SHGs (X18): - It is a non-monetary assistance such as

technical support (record keeping, business plan preparation), provide guidance,

information, sharing business ideas, experience sharing, sharing best practices from other

SHGs. The experience and best practice shared may give confidence SHGs to effectively

44
perform in their business. Therefore, it is assumed that Non-financial support from other

SHGs positively impact on the success of SHG.

Educational status (X19): - It is the educational attainment or level of education of SHG

member's. Ability to read and write and perform basic arithmetic are very necessary to

manage daily living and employment tasks that require reading skills. Therefore it is

hypothesized that educational status has direct relationship with the success of SHG.

3.6. Conceptual Frame Work

A conceptual framework for the study was framed based on the ideas and concepts

gathered from review work of the existing literature of both that will facilitate planning the

study in a comprehensive manner. The purpose of this conceptual frame work was to

provide explanation for observed events and relationship, clarify as well as to show a

bridge the independent and dependent variables.

The conceptual frame work is framed to explain indicators of urban women poverty

reduction and its relation in the study has been explained below.

 Access to Loan: - It is an ability or right to approach to borrowing money with

interest. This money may be used as capital to start a new business or to improve

the existing business in order to get more income. For this reason, it may have a

positive impact on income increase and then poverty reduction.

 Employment generation: - it is an action of giving work to someone or oneself in

order to generate income. This may contribute to getting additional income and

hence for it may contribute to poverty reduction.

 Increased Income: - it is an improvement in the amount of money or its equivalent

received during a period of time in exchange for labor or services, from the sale of

goods or property, or as profit from financial investments. This improvement of

45
 money received may contribute to the household economy. Hence, this may

contribute to poverty reduction.

Figure 2.1 Conceptual Frame on reduction of urban women poverty

Economic Aspect

 Access to Loan
 Employment
generation
 Increased Income
 Increase Saving
 Increase in Household
Expenditure
 Change in Meals per
day

Social Aspect
Skill Development
 Increase self-confidence
and Self Reliance  Access to education,
 Power over local polity training and seminars
and participation in  Improvement in the
socio-political decision- Reduction technical and
making managerial skills
 Access to basic services of Urban  Acquire IGA Skills
(health care, emergency  Ability to tackle
services, public transport, Women problems
school)
Poverty

Political
Access to resources
 Property rights to major
productive assets
 Information Resource
 Physical Resources (Land,  Protection from violence and
shelter , Market Place other crimes
 Infrastructure (piped  protection from
water, sanitation,
discrimination
drainage, electricity)

Source: Framed by the researcher

46
 Increase Saving: - It is an improvement in preserving the portion of income not

spent on consumption of consumer goods but accumulated or invested directly in

capital equipment (BusinessDectionary.com). This may contribute positively to

future investment and to survive bankruptcy. Hence, this may positively contribute

to poverty reduction.

 Increase in Household Expenditure: - it is an improvement in the ability to

purchase products for everyday needs such as food, clothing and so on for the

whole family. This may improve the livelihood of a family. Hence, this may

contribute to poverty reduction.

 Change in Meals per day: - it is an increase in number of times and regularity of

food that one person gets within a day. As the number of times and regularity of

food increases there is a greater probability to reduce hunger, improve health and

increase productivity. Hence, changes in the frequency of meals per day contribute

to poverty reduction.

 Access to education, training and seminars: - It is an opportunity, ability or right

to meaningful learning to acquire knowledge and skill. It is assumed that

education, training and seminars empower people to break the cycle of poverty and

take control of their lives. Access to education, training and seminars may have a

positive impact in poverty reduction.

 Improvement in the technical and managerial skills: - Enhancement of ability to

use one's knowledge effectively and readily in execution or performance. It is

assumed that improvement in technical and managerial skills increase job

performance. Hence, this may have a direct influence on poverty reduction.

 Acquire IGA Skills: - is gaining ability to implement small economic activity,

which is generally operated at or near home using one‟s own labor or the labor of

47
 family members with the purpose to increase family income. It is assumed that

operating an IGA may provide the opportunity to be self-employed using one's own

skills and resources and increase income. Therefore, it may have a direct relation with

poverty reduction.

 Ability to tackle problems: - a capability to deal with challenges and obstacles in

life. When women capable enough to tackle their problems it may give them be

part of to find solutions. Hence, this may have a positive influence on poverty

reduction.

 Property rights to major productive assets: - a legal limits governing the use

and control of asset that is used to produce goods. Property right to major

production assets may affects women‟s ability to sustain their families and manage

other resources that lay the foundation for sustainable production systems.

Therefore, property right to major productive assets may have a positive relation to

poverty reduction.

 Protection from violence and crimes: - it is security from physical force intended

to hurt, damage, or kill someone or something and illegal activities. It is assumed

that women are exposed to violence and crime which may also affect their

contribution to household economy improvement. Thus, Protection from violence

and crimes has a positive relationship with poverty reduction.

 Protection from discrimination: - is the act of keeping someone not to be treated

unfavorably because of gender. In is assumed that gender discrimination against

women may affect the economic activity of women. Hence, protection from

discrimination may have an influence on poverty reduction.

 Information Resource: - it is source of available data, technology, people and

process to be used by the people to perform business processes and tasks. It is

48
 assumed that information resource may contribute for the success of any business

in such a way that it may inculcate new business ideas. This is hypothesized that it

has a positive relationship with poverty reduction.

 Physical Resources: - These are resources that are available to a business in the

form of Land, shelter, Market Place and so on needed for the day to day running of

the business. Physical resources are basic necessity for business success. Thus, it is

assumed that physical resource has a positive relation to poverty reduction.

 Increase self-confidence and Self Reliance: - it is improvement of a conviction in

oneself and one's own capabilities, judgment, or resources. Self-confidence and

self-reliance may contribute for the success of any business. Therefore, this has a

positive influence in poverty reduction.

 Power over local polity and participation in socio-political decision-making:- it is

an influence in local community and participating in a thought process of selecting

a logical choice from the available options. Power over local polity and

participation in socio-political decision-making is assumed that it facilitate

ownership and participation in SHG. This may have a positive influence in poverty

reduction.

 Access to basic services: - it is the right to have basic facilities such as health care,

emergency services, public transport, and school and so on. Poor people may not

have access to basic services which hiders their effort in the fight against poverty.

Therefore, access to basic facilities has a direct relationship with poverty reduction.

49
 CHAPTER - IV
RESULTS AND DISCUSSIONS
In this research the researcher tried to pull together the various methods and approaches in

order to explain the impact of SHGs that contribute for urban women in poverty reduction

in Hawassa city. The research highlights key issues related to urban women's poverty to

demonstrate how SHG approaches are used to address different issues. Several general

conclusions emerged from the review of the results are discussed in this chapter.

4.1. Socio-economic Profile of the Respondents

Consideration of socioeconomic profile is essential for fully understanding social and

economic status, participation and activities of the respondents. The identity of SHG

members with regard to their age, marital status, education, family type, family size,

responsibility in the family, number of dependents (number of children under 18 years),

family monthly income have a significant role to play in the life of women, their

participation in social and economic activities and their struggle against poverty. Bezabih

Tolossa (2007) and Getachew Zewdie (2012) stated that socio-economic characteristics

are the important variables that affect the life of the poor, particularly women in their

empowerment and development. Therefore the researcher has collected relevant data and

analyzed the same and presented the results in the table 4.1.

4.1.1. Age Range of the Respondents

Understanding the age profile is of vital importance in several areas of economic research

for the reason that mental ability and personal job performance decline with age increase

that may directly affect learning new skills and productivity. The age composition shown

in the table 4.1 reveals that 43.00 percent of the respondents in their young age which is

between 18 to 35 years and 51.20 percent in their middle age (36 to 55) and the remaining

5.8 percent is in the older age group which is above 56 years.

50
 Table 4.1 Socio-economic Profile of the Respondents

Number of Respondents Percentage

18-25 11 9.1
Young Age
26-35 41 33.9
36-45 43 35.5
Age Range Middle age
45-55 19 15.7
Old Age above56 07 5.8
Total 121 100.0
Illiterates 17 14.0
Literates 20 16.5
Grade 1-4 25 20.7
Grade 5-8 24 19.8
Educational Status
Grade 9-10 27 22.3
Vocational Certificate 03 2.5
College Diploma 05 4.1
Total 121 100.0
Married 94 77.7
Unmarried 04 3.3
Marital Status Divorced 08 6.6
Widowed 15 12.4
Total 121 100.0
Nuclear family 49 40.5
Joint family 12 9.9
Types of family
Extended family 60 49.6
Total 121 100.0
1- 4 42 34.71
5-8 64 52.89
9 -12 15 12.4
Family size Total 121 100.0
Minimum Maximum Mean

1.00 12.00 5.74

Male Headed 93 76.86
Family Head Female Headed 28 23.14
Total 121 100.0
Families with no child 06 4.96
1-3 51 42.15
4-6 47 38.84
Number of children 7-10 17 14.05
Total 121 100.0
Minimum Maximum Mean
1.00 10.00 4.08
3,600 -7,200 43 35.50
7,201- 10,800 36 29.80
10,801 – 14,400 19 15.70
Annual household income 14,401 – 18,000 11 9.10
in Birr 18,001 – 24,000 03 2.48
24,001 – 36,000 06 4.96
36,001 – 48,000 03 2.48
Total 121 100.00
Source: Primary Data

51
This analysis showed that about 94.20 percent of the respondents which is believed to be

in their productive age group who are more energetic and can take responsibility of

additional work in the household and outside. These findings are in line with other

researchers.

Devaltha C.M. (2005) stated that young and middle aged women were generally large

numbers in the society, getting free time and being more responsible citizens than older

aged women. These women are generally enthusiastic and innovative in nature. The young

aged women will be having the activity to take risk and opportunity to improve the

standard of living by saving and taking up of additional enterprises with the help of SHGs.

Productivity reductions at older ages are particularly strong for work tasks where problem

solving, learning and speed are needed. The elderlies learn at a slower pace than younger

individuals therefore the age of SHG members would be a factor for training, awareness

creation program, and new way of income generation activities effectively.

4.1.2. Educational background

It is widely agreed that the relationship between poverty and education operates in two

directions: poor people are often unable to get access to adequate education, and without

an adequate education people are often constrained to a life of poverty. Poverty is not

simply the absence of financial resources. Poverty is the lack of ability to function

effectively in society. Inadequate education can thus be considered a form of poverty.

Therefore, women's awareness about education and educating children can break the

vicious circle of poverty. Thus, the respondents‟ level of education was examined and the

results discloses that 14 percent are illiterates, 16.5 percent literates, 20.7 percent

completed from grade 1 to 4, 19.8 percent completed from grade 5 to 8, 22.3 percent

completed from grade 9 to 10, 2.5 percent got some vocational training and 4.1 percent

graduated from college with a diploma. Therefore, 69.5 percent of the respondents can

52
read and write and perform basic arithmetic that contributes to their SHG in keeping

records by themselves.

Bezabih Tolossa (2007) stated that one of the measures that contribute to the cooperative

functioning of the SHG is the efficient maintenance of SHG books completed and

managed by the members themselves. The members‟ ability to read, write and perform

basic arithmetic is essential to ensure such a success. Moreover, although it is not the only

factor, a lack of education is believed to be one of the major factors for unemployment.

4.1.3. Marital Status of Respondents

The negative economic consequence of divorce and widowhood tend to be greater for

women and their children. Culturally during divorce children are left with their mothers

and mothers should work outside to get income as well as in the house to support their

children that increases the work load tremendously. Women who are widowed and

divorced either do not work or work a few hours to move themselves and their children

out of poverty. There are many reasons that poor urban women work few hours that

include difficulty to find jobs, the demands of caring for young children, poor health, and

so on; so, being poor a family head is a challenge for most urban poor women. Getachew

(2012) reported that the responsibility of leading the family and earning income for the

family is the responsibility of female headed households.

In order to verify whether such a situation exists among members in the sampled SHGs

under the study, marital status was taken as one of the characteristics to be examined. As

shown in the table 4.1 the results revealed that 77.70 percent of the respondents are

married, 12.40 percent are widowed, 6.60 percent are divorced and 3.30 percent are

unmarried women. Most of the respondents are married; therefore, there is a greater

probability of participation in SHGs to find the means of survival and taking care of the

family.

53
4.1.4. Family Type and Size

Devaltha C.M. (2005) stated that because of urbanization, the joint family system is

withering away even in rural areas and emergence of nuclear families is a common feature

and also it may be due to advantages of nuclear families in terms of improving their

standard of living, responsibilities, smooth running of the family etc., by the women.

The results of data reveals that the types of family that respondents belongs is 40.50

percent in nuclear family, 49.6 percent have extended family and 9.90 percent has joint

type family as depicted in the table 4.1.

Family size can affect the employment status of the female family member. A large family

size implies more work at home and female worker has to devote more time for smooth

functioning of family affairs than work for an income earning purpose. According to

Ethiopia Demographic and Health Survey 2011 (CSA, 2012) average household size are

4.6 persons. In urban areas the average household size is 3.7 persons. As shown in the

table 4.1 the average family size of the respondents is 5.75 which is higher than the

national average. Esubalew Alehegn (2006) stated that an increase in household size had a

significant positive influence on the likelihood that household was chronically poor or fell

into poverty.

4.1.5. Headship of the family

According to Ethiopia Demographic and Health Survey 2011(CSA, 2012) about one-

quarter (26%) of Ethiopian households are headed by women. The data from the

respondents discloses that 23.14 percent households are headed by woman which is less

than the national survey result. 76.84 percent are male headed family as indicated in the

table 4.1. This indicates that nearly quarter of the respondents have a double burden of

work that imply lower rate of participation in paid or unpaid labor outside home.

54
4.1.6. Number of children in a family

Numbers of children in a family and activity status of children may affect women's

participation in social and economic activity. For instance women with little children who

are not school going have more responsibility at home than women who have children

who are school going and working children. As shown in the table 4.1 the average

numbers of children in a family of the respondents are 4.08 with minimum 1 and

maximum 10 children and majority (62%) are school going children and 8.92 percent are

small children who are not in school.

4.1.7. Respondents’ Economic profile

Household income is an important indicator of poverty reduction. A. Sundaram (2012)

concluded that SHG Program clearly plays a central role in the lives of the poor. The

program in various blocks all seems to be very successful in reaching poor clients

importantly; there is evidence of increased household income. D. Suresh Kumar (2009)

concluded that the SHG activities bring not only increased income of the households who

participate in various income generating activities but also help them in asset building. As

shown in the table 4.1, 71 percent of respondents got an annual household income between

3600 Birr and 14,400 Birr. Majority (35.50%) of the respondents got an annual household

income between 3,600 Birr and 7,200 Birr.

4.2. Change in Knowledge and Awareness due to participation in SHG

To assess the increase of knowledge and awareness due to SHG participation, training

provided to SHG members and the knowledge and awareness change due to participation

in the training was analyzed in this study and the discussion is below.

4.2.1. Knowledge Change

Training and Awareness Creation are all forms of change-oriented communication in

which a sender or source conveys messages to one or more receivers with the explicit

55
purpose of establishing a change in the knowledge, attitudes and, ultimately, the behavior

or practices of those receivers. In this regard awareness creation is very crucial for urban

poor women so that they may understand their own situation and potential to overcome

poverty. Hence an assessment has been made and the results of the study found out that

the following trainings were provided to SHG members by Integrated Urban Development

Department of Kale Hiwot Church (IUDD-KHC) and Bright Image for Generation

Association (BIGA).

Table 4.2 Respondents Participation in Trainings

Number of
respondents
Training Topics participated Percentages
The Concept and Objectives of SHG 121 100.00
Loan and Loan recovery 121 100.00
Income generating activities 118 97.52
By laws and rules of SHG 121 100.00
Child and women right 102 84.30
Gender equality 67 55.37
Child abuse protection 95 78.51
How to care the elderly people 53 43.80
Saving and its importance 121 100.00
Job creation and Self employment 78 64.46
Family Planning 116 95.87
Social participation, cohesiveness and service 91 75.21
Environmental Sanitation 109 90.08
Personal Hygiene 115 95.04
Importance of Education 88 72.73
Financial Recording system 119 98.35
Basic Business Skills 117 96.69
Networking with others 59 48.76
Market assessment and business plan 98 80.99
Relationship 95 78.51
Health and HIV/AIDS 107 88.43
Source: Primary Data
Training in general is a productive way to help SHG members to learn how to carry out

certain things in a systematic manner. Therefore, training presents an opportunity to

expand the knowledge base of all SHG members. As shown in table 4.2 more 50 percent

56
of the respondents participated in the trainings organized by the two NGOs on the subjects

of health and sanitation, social, economic and on the concepts and principles of SHG. The

knowledge and awareness changes due to participation in various trainings were analyzed

and the results are presented hereunder.

4.2.1.1 Health and Sanitation Knowledge Change

In order to assess the knowledge change, all respondents were asked whether their

knowledge has increased or not due to the participation in SHG regarding knowledge in

personal hygiene, environmental hygiene, family planning and reproductive health and

Sexual transmitted disease (STD).

Table 4.3 Respondents Health and Sanitation Knowledge Change

Number of
List of Knowledge Level of Change respondents Percentages
Same as before joining SHG 13 10.70
Knowledge in personal Increased after joining SHG 108 89.30
hygiene
Total 121 100.00
Same as before joining SHG 12 9.90
Environmental hygiene Increased after joining SHG 109 90.10
Total 121 100.00
Same as before joining SHG 05 4.10
Knowledge in family
Increased after joining SHG 116 95.90
planning methods
Total 121 100.00
Same as before joining SHG 06 5.00
Knowledge in reproductive
Increased after joining SHG 115 95.00
health and STD
Total 121 100.00
Same as before joining SHG 13 10.70
Awareness on food and
Increased after joining SHG 108 89.30
balanced diet
Total 121 100.00
Same as before joining SHG 20 16.50
Sanitation and safe water Increased after joining SHG 101 83.50
Total 121 100.00
Same as before joining SHG 25 20.70
Prenatal care Increased after joining SHG 96 79.30
Total 121 100.00
Source: Primary Data
As shown in the table 4.3, 89.3 percent of respondents confirm that their knowledge

increased regarding personal hygiene and more that 90 percent of respondents stated that

their knowledge has increased about environmental hygiene, family planning and

57
reproductive health and STD (Sexual transmitted disease). More than 75 percent of

respondents stated that awareness regarding prenatal care, Sanitation and safe water, food

and balanced diet has even increased. Generally, it can be concluded that health and

sanitation knowledge increase may help respondents choose healthier life styles and

enable them to make better informed choices among the health related options available

for themselves and their families, including those related to finding and managing medical

care.

4.2.1.2. Awareness Change about SHG

Unless the women have full knowledge about the objectives and functions of SHGs, they

may not show interest to participate.

Table 4.4 Respondents Awareness Change about SHG and its activities
Indicators increase or Number of
List of Awareness Percentage
same as before respondents
About objectives of SHG Increased after joining SHG 121 100.00
About bylaws rules and Increased after joining SHG
121 100.00
regulations of SHG
About the importance of Increased after joining SHG
personal saving and loan 121 100.00
with SHG
Same as before joining SHG 04 3.30
Awareness of business plan Increased after joining SHG 117 96.70
Total 121 100.00
Same as before joining SHG 08 6.60
Importance of financial
Increased after joining SHG 113 93.40
recording
Total 121 100
Same as before joining SHG 03 2.50
Awareness about income
generating activities Increased after joining SHG 118 97.50
Total 121 100.00
Source: Primary Data

According to the result shown in the tables 4.4 respondents affirmed that their level of

awareness has increased due to participation in self-help groups. All of the respondents

reported that their awareness regarding the objectives of SHG, bylaws, rules and

58
regulations of SHG as well as the importance of saving and loan with SHG has increased

after joining SHG. More than 90 percent of the respondents stated that awareness

regarding business plan, the importance of financial recording and income generating

activities has increased after joining SHG.

4.2.1.3. Social Awareness Change

Social awareness is the active process of seeking out information about what is happening

in the communities around. A greater awareness of social norms and problems leads to

better understanding and better solutions. Therefore in this research respondents‟ social

awareness was assessed.

Table 4.5 Respondents Social Awareness Change

Number of
Awareness Change Status Percentage
respondents
Same as before joining SHG 21 17.40
Awareness on importance of
Increased after joining SHG 100 82.60
child education
Total 121 100.00
Same as before joining SHG 14 11.60
Awareness about literacy Increased after joining SHG 107 88.40
Total 121 100.00
Same as before joining SHG 30 24.80
Awareness on group stability
and cohesiveness Increased after joining SHG 91 75.20
Total 121 100.00
Same as before joining SHG 26 21.50
Awareness social cohesiveness Increased after joining SHG 95 78.50
Total 121 100.00
Same as before joining SHG 20 16.50
Child abuse and protection Increased after joining SHG 101 83.50
Total 121 100.00
Same as before joining SHG 40 33.10
Current Political system Increased after joining SHG 81 66.90
Total 121 100.00
Same as before joining SHG 24 19.80
Legal rights Increased after joining SHG 97 80.20
Total 121 100.00
Source: Primary Data

As depicted in table 4.5 more than 75 percent respondents reported that awareness on

group stability, social cohesiveness, child abuse and protection has increased after joining

59
SHG. 66.9 percent of the respondents agreed that their awareness about the current

political system. It is crucial to raise women's awareness about their contributions to

society and their political, economic and social rights since they are to contribute to the

rebuilding of their families, communities and nations.

4.2.2. Change in Decision making in the home

Involvement in Self Help Groups is expected to enable the members to develop the ability

to take proper decisions in family matters, management skills and the leadership qualities.

Participation in group activities is helpful in developing the sense of responsibility and

give women insight to the decision making process that enhance participation in SHG

enabled urban poor women to take important decisions in their families. Getachew (2012)

stated that involvement in SHGs enabled most of the members to receive proper recognition

within their community in general with their family members in particular. As most of

the SHG members have become income generators for their family, their decision making

power about income and expense related matters has shown significant affirmative

change. Thus, this indicates that SHGs are an important scheme in empowering people,

playing an important role in boosting the availability of resources for poor women within the

community.

As shown in the table 4.6, before joining SHG, 58.68 percent families were male headed

and decision on child education, family expense, asset building and participation in a

meeting were taken by male. However, after joining SHG, women‟s participation in

family decision making has improved and shared decision making increased from 18.18

percent to 81.82 percent of the total respondents. Therefore it is believed that attending

regular meeting in SHGs and experience gained in group decision making process

empowers women to participate in decision making in the home.

60
 Table 4.6 Respondents Influence in decision making

Decision
on Decision Decision Decision on
Decision
Status education at Family on asset participating
maker
of Expense building in meetings
children
Number of
Before respondents 71 71 71 71
SHG
Male Head Percentage 58.68 58.68 58.68 58.68
only Number of
After respondents 01 01 01 01
SHG
Percentage 0.83 0.83 0.83 0.83
Number of
Before respondents 28 28 28 28
SHG
Female Percentage 23.14 23.14 23.14 23.14
Head only Number of
After respondents 21 21 21 21
SHG
Percentage 17.36 17.36 17.36 17.36
Number of
Before respondents 22 22 22 22
SHG
Percentage 18.18 18.18 18.18 18.18
Shared
Number of
After respondents 99 99 99 99
SHG
Percentage 81.82 81.82 81.82 81.82
Source: Primary Source

4.2.3. Changes on Resource Utilization

Shreedevi S. (2012) stated that women empowerment aims at enabling them to realize

their identities, potential and power in all spheres of their lives the real empowerment of

women is possible only when a woman has increased access to economic resources. In line

with these changes due to the participation in SHG was analyzed by collecting the data

using Likert‟s five point scale measurement tool and converted into three point scale

format to categorize as increase, same and decreased. Therefore, as shown in the table 4.7,

more than 90 percent of respondents disclose that family income, saving capacity,

borrowing capacity, food expenditure, meals per day, clothing expenditure, expenditure

for health care and medical treatment, expenditure on children education and household

61
furniture have increased. 66.12 percent of respondents confirm that work load have

decreased due to participation in SHG.

Table 4.7 Respondents Income, Consumption and Expenditure Changes due to

membership in SHG
Particulars Increased Same Decreased
119 02
Family income --
(98.35) (1.65)
39 02 80
Work Load
(32.23) (1.65) (66.12)
119
Saving capacity -- (1.65)
(98.35)
114 03 04
Borrowing capacity
(94.21) (2.48) (3.31)
116 05
Food Expenditure --
(95.87) (4.13)
109 12
Meals Per Day --
(90.08) (9.92)
110 03 2
Clothing Expenditure
(95.87) (2.48) (1.65)
Expenditure for Health care and 118 11
--
Medical treatment (90.91) (9.09)
118 02 01
Expenditure for Children Education
(97.52) (1.65) (0.83)
120 01
Expenditure for Household furniture --
(99.17) (0.83)
Source: Primary Data
Note: Figures within parenthesis show percentages.
4.3. Impact of SHG in urban women poverty Reduction

Review of literature shows that with respect to increases in income, consumption,

stabilization of income and general economic empowerment of beneficiaries, a positive

impact of the SHG program for women, a definite positive impact on the social

empowerment. These studies highlight the increase in the confidence levels of the women,

as also their involvement in community activities. According to these studies, as the SHG

program matures, the women get more involved in community activities and in addressing

community problems by working in tandem with the government machinery to implement

the different welfare schemes available, sanitation programs, schemes for education and

62
health etc. (Sumitra Bithi Kachari and Dukhabandhu Sahoo, 2008, S. D. Dabali, 2010,

Benyam Asfaw, 2009, A. Sundaram, 2012)

To find out the impact of participation in SHG to overcome women poverty in the study

area Income change, change in saving habit and amount, in access to loan, housing

condition, possession of household items, frequency of meals per day, incidence of illness,

access to medical facilities along with expenditure change in food, medical, house rent,

piped water, electric power and transportation was used as indicator to poverty reduction

and paired T-test was applied in order to understand the significant change of sample

respondents before and after joining SHG.

4.3.1. Income Change

Change in income as a result of involvement in SHG is one of the variables that may

explain the reduction in urban women's poverty. For the sake of clarification and

presentation, the detailed respondent‟s monthly income before and after joining SHG was

summarized in table 4.8 with different income categories.

The results (Table 4.8) shows that 95.04 percent of the respondents had a monthly income

less than 900 Birr per month before they join SHG with an average income 440.17 Birr; on

the other hand, after women joining SHG, their monthly income increased and 73.50

percent of the respondents have a net monthly income greater than 900 Birr with an

average monthly income of 1506.04 Birr per month. The test of significance also

confirmed the same at 95 percent confidence interval. The calculated t-value is 15.11 but

the table value at 5 percent significant level is 2.36, since the calculated value is greater

than the table value this shows the change is statistically significant.

63
Table 4.8 Distributions of Respondents Income Change Before and After SHG

Before SHG After SHG

Monthly Sig. (2-
Number of Number of
Income in Birr t tailed)
respondents Mean respondents Mean
52
Less than 300 (42.98) --
47 18
300 - 600 (38.84) (14.88)
11 14.00
601 - 900 (13.22) (11.57)
06 49
440.17 1506.04 15.11 0.000*
901- 1500 (4.96) (40.50)
-- 18
1501 - 2000 (14.88)
14
--
2001 - 3000 (11.57)
08
--
3001 - 4500 (6.61)
Source: Primary Data
Note: Figures within the parenthesis show percentages.
Note: * shows the test of significance at 5 percent significant level.
After involvement in SHG respondent‟s annual household income significantly improved

as shown in Graph 4.1, and majority (77.68%) of the respondents‟ annual income was less

than 4000 Birr before joining SHG. After joining SHG 74.38 percent of the respondents

earn an annual income greater than 4000 Birr; hence, respondents‟ annual income has

improved after involvement in SHG.

Therefore, involvement in SHG does lead to an increase in income that contributes to

poverty reduction. This is in line with Sumitra B. and Dukhabandhu S. (2008) study and

found that after SHGs the incomes of the members have been increasing marginally.

Bharath R.A (2005) also found out that 95.00 percent of the respondents‟ income after

joining the group has increased.

64
 Graph 4.1 Respondents annual income before and after SHG

45.45
50.00
45.00

32.23
40.00

27.27

24.79
35.00
Percentages

22.31
21.49
30.00
25.00

13.22
20.00
15.00
4.13

2.48

2.48
1.65

1.65
10.00

0.83
0.00

0.00

0.00

0.00

0.00
5.00

0
0.00
Less than 1500

1501 - 4000

4000 - 6000

6000 - 9000

18001- 21000
9001 - 12000

12001 - 15000

15001 - 18000

21001 - 24000

24001 - 36000
Annual Income in Birr

Before SHG After SHG

Source: Primary Data

4.3.2. Change in Saving habit and amount

Regular saving is a very important component in the SHG approach. It helps the members

stretch their ability and discover that they can do more than they thought they could. The

growing group saving is also a tangible indicator that they are achieving what they have

set out to achieve. Savings could be by doing some additional work and earning a little

more or it could also be made possible by cutting down on some expense and bringing in

the money. Therefore, saving is an important aspect that need be considered in order to

explore the impact of SHG.

65
 Table 4.9 Respondents Saving before and after joining SHG
Before
After SHG
SHG Sig.
Saving Amount
Mean Mean t (2-
in Birr Number of Number of
tailed)
respondents respondents
121 19
less than 10 (100) (15.70)
44
11 - 20 -- (36.40)
32
21 - 40 -- (26.40)
14
41 - 100 -- (11.60)
05
-- 58.35 4.52 0.00*
101 - 200 -- (4.10)
03
201 - 300 -- (2.50)
01
301 - 400 -- (0.80)
03
401 - 1000 -- (2.50)
121
Total 121 (100)
Source: Primary Data
Note: Figures within the parenthesis show percentage.
Note: * shows the test of significance at 5 percent significant level.
As shown in the table 4.9 the paired T-test result indicate that change in saving after

joining SHG is statistically significant. The test of significance confirmed that at 95

percent confidence interval the calculated t-value is 4.52 but the table value at 5 percent

significant level is 2.36, since the calculated value is greater than the table value this

shows the change is statistically significant. This indicates that individual members‟

awareness regarding savings and saving culture has improved significantly and overall

performance of the groups‟ savings managed well in both in individual as well as group

savings. Regular savings and increase in income and household economic stability may

have a positive correlation. It is easier to save when income is increasing, in contrast to

when it is declining. This finding is in line with Bezabih (2007) and Getachew (2012).

66
According to Sowjanaya (2007) in all the SHGs, all the members contributed their savings

on the day fixed which shows that they were following rules and regulations and

maintained punctuality. Some members skipped contribution due to irregular income; they

were not following SHGs rules and regulations, and belonged to the low income category.

Devaltha C.M. (2005) discussed that women led SHGs have successfully demonstrated

how to mobilize and manage saving, appreciate credit needs, maintain linkages with the

banks and enforce financial self-discipline.

4.3.3. Change in access to loan

It is difficult for the poor women to get loan from formal institutions due to their poor

economic levels to fulfill the requirements. Hence giving loan to poor without collateral is

one of the foundational principles of SHG for that reason one of the most critical benefits

of SHGs is to create easy access to loan mostly for income generating activities. Access to

loan empower and motivate women to work and contribute to the family. So it is good to

see the changes takes place among SHGs in accessibility of loan facilities before and after

their membership in SHGs.

The result of the data collected as shown in table 4.10 revealed that out of 121 respondents

23.97 percent women took loan before they join SHG that are 22.31 percent respondents

from individual many lenders, 0.83 percent of the respondents from credit and saving

association and 0.83 percent of the respondents from NGO. On the other hand, out of 121

respondents 114 women took loan after they join SHG and 93.39 percent of the

respondents took loan from SHGs. Women completely quit taking loan from individual

money lenders after they join SHG.

67
 Table 4.10 Access to Loan Before and After Joining SHG from different sources

Loan before and Number of Sig. (2-

Pairs Mean t df
after respondents tailed)

Individual Money 27
87.44
Lender before (22.31)
Pair 1 4.39 120 0.00*
Individual Money
-- --
Lender after
Saving and credit 01
1500.00
association before (0.83)
Pair 2 -2.16 120 0.03*
Saving and credit 15
533.06
association after (12.40)
SHG loan before -- --
Pair 3 113 -10.88 120 0.00*
SHG loan after 2,292.98
(93.39)
Bank loan before -- --
Pair 4 03 -1.75 120 0.08*
Bank loan after 10,000.00
(2.48)
NGO or micro
01
finance institution 1500.00
(0.83)
before
Pair 5 01 120 0.32*
NGO or micro
finance institution -- --
after
Source: Primary Data
Note: Figures within the parenthesis show percentage.
Note: * shows the test of significance at 5 percent significant level.
The Sig. (2-Tailed) value is 0.08 for loan from bank and 0.32 for loan from NGO or micro

finance institute which is greater than 0.05. Because of this, we can conclude that there is

no statistically significant difference between loan from bank and loan from NGO or

micro finance institute before and after participation in SHG. The test of significance at 5

percent significant level shows that loan from individual money lenders, loan from credit

and saving association and SHG are statistically significant. Loan from individual money

68
lenders has significantly dropped on the other hand loan from saving and credit

associations and SHG increased.

These results indicate that SHG members‟ awareness and knowledge regarding loan has

increased and loan for income generating activities has also increased. A similar result was

reported by Anand Gopalan (2006) which he found out that loan for income generating

activities increased from 50 percent to 70 percent. Jael van der Heijden (2006) concluded

that knowledge about available loan services, favor in using these loan services and no

longer having to take a loan from moneylenders is seen as a major benefit from being a

member of a SHG. A.Sundaram (2012) stated that result of participation in SHGs is an

improvement in a women‟s access to credit. Bezabih T. (2007) stated that the involvement

in SHG has guaranteed them to have access to loan from the group savings, and has also

empowered them to get loans from various micro finance institutions without much

difficulty.

4.3.4. Housing condition and Household Item

Poverty is a multi-faceted phenomenon which affects not only the ability to purchase

goods, but also vulnerability towards various pressures; housing among the list of

indicators that may prohibit people from enjoying life. Rebecca Tunstall, et.al (2013)

reported that most of the numerous definitions of poverty and material deprivation cannot

be entirely separated from housing circumstances. Housing is a major charge on income, a

source of income like flows of benefits or even cash income itself, and it makes a big

contribution to material living conditions. In order to examine the housing condition of the

respondents, data was collected from the SHG members and summarized in the table 4.11.

69
 Table 4.11 Respondents Housing Conditions
Before SHG After SHG
Number of Sig.
Number of Rooms (2-
Descriptions Number of Number of t
respondents respondents tailed
reside in respondents respondents
)

39 65
Own
(32.2) 1 Room (53.7)
Tenancy 82 2-3 48 80
Rented
Status (67.8) Rooms (39.7) (66.1)
121 4-5 6 17
Total
(100) Rooms (4.9) (14.1)
8.16 0.00*
37 6-7 01 02
Government
(45.12) Rooms (0.8) (1.7)
Private 45 8- 9 01
Renters --
renters (54.88) Rooms (0.8)
82 10 -12 05
Total --
(100) Rooms (4.2)
Source: Primary Data
Note: Figures within parenthesis indicate percentages.
Note: * shows the test of significance at 5 percent significant level.

By the time the data was collected, tenancy status of the respondents was as shown in the

table 4.11, among the respondents 32.2 percent dwelled in their own house and the

remaining 67.8 percent dwelled in a rented house from which 54.88 percent rented from

private renters. The number of rooms that respondents resided was significantly increased

after their involvement in SHG; for instance, 53.7 percent of respondents were dwelled in

one room house before they involve in SHG and after they involve in SHG only 14

percent are reside in single-room houses. The test of significance indicated that at 95

percent confidence interval the calculated t-value is 8.16 which is greater than the table

value which is 2.36, since the calculated value is greater than the table value this shows

the change in number of rooms is statistically significant.

Possession of Household Items

The availability of durable consumer goods is another indicator of a household‟s

socioeconomic status and the particular goods have specific benefits. For instance, a radio

or a television can bring household members information and new ideas; a refrigerator

70
prolongs the wholesomeness of foods; and a means of transport can increase access to

many services that are beyond walking distance (Ethiopian Demographic Health Survey -

CSA, 2012). By this reason in this research availably of household items was taken as an

indicator for impact and assessed from the data.

Table 4.12 Possession of Household Items

Before SHG After SHG

Household Items Number of Number of
Percentage Percentage
respondents respondents
Radio 78 64.46 48 39.67
Electronic Tape recorder 54 44.63 105 86.78
and Electrical TV 22 18.18 110 90.91
Items DVD Player 17 14.05 98 80.99
Refrigerator 07 5.79 30 24.79
Chair and
109 90.08 118
table 97.52
Sofa 16 13.22 90 74.38
Furnitures
Bed for Adult 95 78.51 117 96.69
Bed for
32 26.45 93
Children 76.86
Bicycle 13 10.74 62 51.24
Vehicles
Motor Bicycle -- -- 13 10.74
(Means of
Transport) Three Wheeler
01 0.83 03 2.48
(Bajaj)
Source: Primary Data

As shown in the tables 4.12, availability of each household item in the list have increased

after women join SHG except radio which dropped from 64.46 percent to 39.67 percent

this may be due to people preference of television than radio. Most of the electronic items

are considerably more predominant. According to Ethiopia demographic health survey

result (CSA, 2012) in urban areas 42.1 percent own television and 90.91 percent of the

respondents own television. Similarly, regarding the possession of refrigerator the national

data indicate that in the urban areas of Ethiopia 14.3 percent own refrigerator and 24.79

percent of the respondents own refrigerator after they join SHG. The contribution of

involvement in SHG in improving the possession of household items is noticeable.

71
4.3.5. Change in frequency of meals per day

Urban hunger is a largely invisible problem and quite a number of urban poor people

missed one or more meals per day because they can‟t afford to buy food. Therefore, in this

research frequency of meals per day was taken as an indicator to observe and analyze the

impact of SHG in urban women poverty reduction.

Table 4.13 Frequency of Meals per Day before and after SHG
Meals per day before Meals per day after
Meals and joining SHG joining SHG Sig. (2-
t
snacks per day Number of Number of tailed)
Percentage Percentage
respondents respondents
Two Times 79 65.30 -- --
Three Times 41 33.90 63 52.1
More than three 01 0.80 58 47.9 20.16 0.00*
times
Total 121 100.00 121 100.0
Source: Primary Data
Note: * shows the test of significance at 5 percent significant level.

Findings indicated that (table 4.13) 65.30 percent respondents can only afford to eat only

two times per day before joining SHG. After women join SHG, 52.10 percent afforded to

eat three times per day and the rest 47.9 percent more than three times. The paired T-test

result indicates that the frequency of meals per day has changed significantly; therefore,

respondents‟ meal per day after they join SHG has significantly increased. These findings

imply that respondents change in frequency of meal per day is noticeable. As urban

dwellers don‟t produce food they depend on purchasing their food that also imply as their

income increases their food purchasing power has also increased. R. Disney et al (2004)

reported that food poverty can be defined as a condition where the household lacks the

resources necessary to acquire adequate diet. Food availability and price all play a role in

determining what and how much an individual eats. D. Suresh Kumar (2009) concluded

that the participation in SHGs has had a positive impact on household welfare in many

ways. The quantity and quality of food consumed is one of them in the list.

72
4.3.6. Incidence of Illness

Health is a fundamental element in assessing the extent to which urban poverty prevails,

simply because in the absence of proper health, the working force whether professional,

skilled or trained cannot have the capability and opportunity to do jobs effectively and

efficiently. Efficiency of workers considerably depends on their health. Workers whose

health is not good and who fall sick quite often cannot do their job efficiently and thus

their efficiency is bound to remain low (Esubalew Alehegn, 2006). As reported in CSA

(2012) health problems were more common in urban areas. As health problem more

common that may relate to the standard of living and job performance; therefore,

incidence of illness was assessed in this research.

Graph 4.2 Incidence of Illness before and after SHG

90.00
80.17 78.51
80.00
70.00
60.00
Percentages

50.00
40.00
21.49

20.66
16.53

16.53
30.00

15.70
20.00
8.26

6.61

6.61
4.13

3.31
2.48

0.83

0.83
0.00
0.00
0.00

10.00
0.83

0.00

0.00

Diseases
Before in % After SHG in %

Source: Primary Data

As shown the graph 4.2 the top 4 diseases that prevailed among the respondents before

they join SHG are Malaria, Diarrhea, Intestinal Parasite and Typhoid. After women join

SHG the top 3 prevalent diseases are malaria, typhoid and typhus. It was observed that a

73
slight decline in the malaria prevalence after joining SHG, a significant decrease in

intestinal parasite, diarrhea, skin infection and dental decay this may be due trainings

provided to SHG members on the subject of health and sanitation that results improvement

in personal hygiene and environmental sanitation. On the contrary there observed that

there were an increase the incidence of illness of typhoid from 16.53 percent to 20.66

percent and typhus from 6.61percent to 15.70 percent. The reason for the increase is that

typhoid is contracted by drinking or eating the bacteria in contaminated food or water.

People with acute illness can contaminate the surrounding water supply through stool,

which contains a high concentration of the bacteria. Therefore this clearly indicates that

there is critical toilet facility and cleanness problem in the villages where respondents

dwelled. Regarding typhus the disease is transmitted by the human body louse, which becomes

infected by feeding on the blood of patients with acute typhus fever. Infected lice transmit the

bacteria in to the skin while feeding on a second host, who becomes infected. Therefore, sanitation

and personal hygiene is still a challenge for the respondents. The Ethiopian welfare monitoring

survey (CSA, 2012), data showed a significant decline in malaria prevalence.

4.3.7. Access to Medical Facilities

Access to medical facilities is one of the indicators of poverty reduction.

From the graph 4.3, 79.34 percent got medical treatment from government medical

centers, 34.71 percent from government hospital, 12.40 percent from private clinic and

33.06 percent use traditional medicines before they join SHG. After they join in SHG they

quit using traditional medicines and tending go to private clinics that may be explained

their paying capacity has increased and seeking better medical treatment.

74
 Graph 4.3 Respondents Access to Health Centers

100.00

100.00
120.00

87.60
79.34
100.00

70.25

66.94
65.29
62.81
61.98
Percentages

80.00

52.89

47.11
38.02
60.00

37.19
34.71

33.06
29.75
20.66
40.00

12.40
20.00

0.00
0.00
0.00
YES NO YES NO YES NO YES NO YES NO
Government Government Private Clinic Private Hospital Use traditional
medical Centers Hospital Medicine
Medical Facilities

Before SHG After SHG

Source: Primary Data

4.3.8. Change in Food Expenditure

Whenever household income increase food expenditure also increases. According to

UNDP (2012) report on African human development stated that nutrition is affected by

range of circumstances that include income, knowledge of sound eating and access to

varied and nutritious food. Hence if more expenditure spent for food leads to increase in

nutritional status.

As shown in the table 4.14, the average spending per day for food per family before

women join SHG was 17.89 Birr and after the join SHG, it increased to 39.09 Birr per day

per family. The test of significance indicated that at 95 percent confidence interval the

calculated t-value is 27.79 which is greater than the table value at 5 percent significant

level which is 2.36, since the calculated value is greater than the table value the change in

food expenditure is statistically significant. This is due to major items in family budget;

75
food might be expected to bear the impact of the adjustments as a result of household

income increase as well as change in food prices.

Table 4.14 Respondents Expenditure for food per day before and after involvement
in SHG

95% Confidence
Std. Interval of the Sig. (2-
Description Mean Difference t df
Deviation tailed)

Lower Upper
Food Expense per day
per family Before 17.89 8.48
SHG
19.69 22.71 27.79 120 0.000*
Food Expense per day
39.09 8.29
per family After SHG
Source: Primary Data
Note: * shows the test of significance at 5 percent significant level.

Graph 4.4 Respondents Food expense per day per family

80 74
70
Number Respondents

60 55

50
40
40
30
20
20 15
9 7 8
10 3 5
0 1 2 2 0 0 1 0
0
10 Birr 20 Birr 30 Birr 35 Birr 40 Birr 45 Birr 50 Birr 55 Birr 60 Birr
Expense

Before SHG After SHG

Source: Primary Data

4.3.9. Medical Expenditure

Expenditures on health is important in building and maintaining a productive labor force

as well as improving the lives of the people, the quality of society and welfare of the

76
economy. In principle, expenditure on health takes the form of investment in medical

knowledge in disease prevention, treatment and rehabilitation (Esubalew Alehegn, 2006).

For that reason in this research respondent biannual medical expenditure was assessed that

may give an answer for their willingness and ability to pay for medical treatment in order

to maintain their health condition.

Table 4.15 Expenditure for Medical Treatment before and after SHG
Medical Expenses per family Before SHG After SHG
per month Number of Percentage Number of Percentage
respondents respondents
10 - 100 Birr 88 72.70 16 13.20
101 -200 Birr 24 19.80 38 31.40
201 - 300 Birr 04 3.30 24 19.80
301 - 400 Birr 01 0.80 28 23.10
ABOVE 401 Birr -- -- 11 9.10
Total 117 96.70 117 96.70
Missing 04 3.30 04 3.30
Total 121 100.00 121 100.00
Source: Primary Data

The table 4.15 results indicate that respondents‟ biannual medical expenditure has

increased after joining SHG. Before women join SHG, 72.7 percent of the respondents‟

medical expenditure was between 10 to 100 Birr and after they join SHG, 83.4 percent of

the respondents‟ medical expenditure has become between 101 to 400 Birr. Four

respondents were not willing to give information regarding their medical history or current

medical status due to their religious views. This is evidence that women tend to go to

medical centers that may provide better services and their willingness and ability to pay

more for better treatment.

4.3.10. Expenditure for House Rent

The amount of house rent denotes the quality house they reside. The average expenditure

for house rent before women join SHG was 51.36 Birr per month. After women join SHG

their average expenditure for house rent has increased to 139.4 Birr per month. The test of

77
significance indicated that at 95 percent confidence interval the calculated t-value is 7.42

which is greater than the table value at 5 percent significant level which is 1.99, since the

calculated value is greater than the table value the change house rent expenditure is

statistically significant as shown in the table 4.16.

Table 4.16 Respondents House Rent Expenditure before and after SHG

House Rent Before SHG After SHG

Sig. (2-
Per Month in t
Number of Number of tailed)
Birr
Respondents Mean Respondents Mean
58 33
Less than 100 (72.50) (41.25)
17 07
101 - 200 (21.25) (8.75)
03 20
201 - 300 (3.75) (25.00)
02 07
301 - 400 (2.50) 51.37 (8.75) 139.4 7.42 0.00*
08
--
401 - 500 (10.00)
03
--
501 - 600 (3.75)
01
--
601 - 700 (2.25)
701 - 800 -- 01 (1.25)
Source: Primary Data
Note: Figures within parenthesis indicate percentages.
Note: * shows the test of significance at 5 percent significant level.

4.3.11. Expenditure for piped water

In most cases in Hawassa, households either share pipes far from their homes or buy

drinking water from their neighbors at a much higher cost than the recommended rate.

Worse still, in times of dry seasons, it is common to happen that households suffer without

water for day‟s even weeks simply because of the absence of an adequate supply of water.

Thus, expenditure for water may increase. So that expenditure may become one of the

major charges on income. For that reason the expenditure for water was assessed in this

research.

78
 Table 4.17 Expenditure for piped water before and after SHG
Monthly Expense Before Monthly Expense After
Per month Expenditure in SHG SHG
Birr Number of Number of
Percentage Percentage
respondents respondents
Less than 10 80 66.10 -- --
11 - 20 30 24.80 14 11.60
21- 30 09 7.40 23 19.00
31-40 02 1.70 38 31.40
41 – 50 -- -- 46 38.00
Total 121 100.0 121 100.00
Source: Primary Data

The monthly expenditure for piped water before and after joining SHG is shown in the

table 4.17 which reveals 90.90 percent pay up to 20 Birr and after they join SHG, 88.4

percent of the respondents pay above 21 Birr. This shows that expenditure for piped water

has increased and the respondents could afford such expenses which is an indicator of

positive impact.

4.3.12. Expenditure on Electric power

The source of energy for lighting used by housing units partly determines the quality of

the living environment besides giving important information about housing quality.

Housing units use various forms of energy for lighting. The data from the welfare

monitoring survey (CSA, 2012) show that housing units in urban areas of the country were

more likely to have electricity as a main source of energy for lighting. The data collected

reveals that all of the respondents have access to electric power for lighting. As access to

electric power increases, so is expenditure; therefore, expenditure for electricity power

was assessed.

The mean monthly expenditure for electric power before and after joining SHG is shown

in the table 4.18 which reveals average monthly expense before joining SHG was 19.61

Birr and after joining SHG the mean monthly expense increased to 66.42 Birr. The test of

79
significance indicated that at 95 percent confidence interval the calculated t-value is 7.16

which is greater than the table value at 5 percent significant level which is 1.98, since the

calculated value is greater than the table value the change electric power expenditure is

statistically significant. It can be concluded that involvements in SHG considerably

contribute to cover monthly electric power expenditure.

Table 4.18 Respondents Electric power Expenditure before and after SHG
Before SHG After SHG
Sig.
Electric Power
Number of Number of t (2-
Expense in Birr Mean Mean
Respondents Respondents tailed)
99 92
Less than 100 (81.82) (76.03)
10
--
101 - 200 (8.26)
19.61 66.42 7.16 0.00*
05
--
201 - 400 (4.13)
01
--
401 - 601 (0.83)
99 108
Total (81.82) (89.25)
Source: Primary Data
Note: Figures within parenthesis indicate percentages.
Note: * shows the test of significance at 5 percent significant level.

Those who live a rented house from privet renters commonly their electric power expenditure is

included in their house rent therefore 23 respondents monthly electric expenditure before SHG and

13 respondents monthly electric expenditure after SHG are not included in this analysis.

4.3.13. Expenditure on Transportation

Judy Baker et al (2005) concluded that expenditures on transportation increase steadily as

income rises, reflecting the shift to more expensive transport modes: from walking to

public transport and, eventually, to private cars, as people become richer. This suggests

that for the very poorest households, access to transportation (in money terms) is

expensive and may affect mobility.

80
Transportation is an important component of the economy in urban area that may have

impact on development. When transportation is affordable, it provides economic and

social opportunities and benefits that result in better accessibility to markets, employment

and additional investments. Household welfare depends on what household members earn,

on the cost and quality of housing they have, and on the cost of transportation. The cost of

transportation constitutes a much higher fraction of income for the poor. Because of high

transportation cost urban poor women may limit themselves not to travel at all or to travel

a shorter distance. For this reason expenditure on transportation was assessed in this

research.

Table 4.19 Respondents Expenditure for transportation before and after SHG
Spending for transportation per Spending for transportation
Monthly Expense month before SHG per month after SHG
for transportation Number of Number of
Percentage Percentage
respondents respondents
Cannot afford 32 26.40 -- --
transportation
5 - 20 Birr 74 61.20 -- --
21 - 30 Birr 12 9.90 20 16.50
31 -40 Birr 01 0.80 23 19.00
41 - 50 Birr 02 1.70 29 24.00
Above 50 Birr -- -- 49 40.50
Total 121 100.00 121 100.00
Source: Primary Data

According to the results show in table 4.19 expenditure for transportation has increased

after women join SHG. 26.4 percent of the respondents cannot afford for transportation,

71.10 percent of the respondents pay between 5 to 30 Birr per month before women join

SHG. On the other hand after joining SHG all respondents can afford for transportation

that imply 83.50 percent pay for transportation above 31 Birr.

In order to arrive conclusion regarding the overall impact of SHG in the poverty reduction,

the national total poverty line used as key indicators. Hence, the 1995/96 national poverty

line which was 1075 Birr taken as a benchmark to examine the percentage of respondents

81
below or above food poverty line before involvement in SHG and the 2010/11 national

poverty line which is 3781 Birr is taken as to measure the percentage of respondents below

or above the poverty line after joining SHG (MoFED, 2012).

As discussed in section 4.3.1, respondents‟ annual income has improved after joining

SHG. As show in the graph 4.5, 45.45 percent of the respondents were below the national

poverty line (1075 Birr) before joining SHG. After joining SHG 24.79 percent of the

respondents are below the national poverty line. The results depicted that percentage of

respondents below poverty line decreased from 45.45 percent to 24.79 percent after

involvement in SHG. This implies that involvement in SHG has positive impact in poverty

reduction. The major factors for respondents being under the national poverty line after

involvement in SHG are business failure and low income earnings from income generating

activities due to duplication of activities to the existing competition in a limited market.

Graph 4.5 Respondents below and above the national poverty line before and after

SHG

80 75.21
70
Percentages

60 54.55
50 45.45
40
30 24.79
20
10
0
Below poverty Above poverty Below poverty Above poverty
line line line line
Before SHG After SHG

Source: Primary Data

82
4.4. Factors determining the participation of women in SHG

To identify the factors determining the participation of women in SHG, average and

percentage analysis was carried out to draw a meaningful interpretation of the results. To

analyze the reasons for joining the group by the member, all the possible reasons were

made known to the members of self-help groups. They were asked to rank the reasons in

the order of their importance. The ranks given by them were quantified using the Garrett

Ranking Technique (Garrett, 1969).

All respondents became member of SHG before 4 years and stay as a member up to now,

and one respondent has been a member for more than ten years. As shown in the table

4.20, 47.1 percent of respondents have been member for 4 up to 6 years and 52.1 percent

of the respondents have been a member of for 7 up to 9 years.

Table 4.20 SHG membership Period

Membership Duration Number of respondents Percentage
4-6 Years 57 47.10
7-9 Years 63 52.10
10 Years and above 01 0.80
Total 121 100.0
Source: Primary Data

Reasons for participating in SHG

As indicated in the table 4.21, respondents were asked the reasons for participating in

SHG using Likert‟s five scale method and the result was analyzed. Therefore, the top five

reasons for participating in SHGs were mobilizing saving, access to loan, promotion of

income generating activities, family and personal asset possession and low income before

joining SHG. Similar findings are indicated by other researches like Devalatha C.M.

(2005) the majority of the groups indicated that financial problems and to get loan of

lesser rate of interest were the reasons which motivated respondents to get into form action

83
of SHGs. And also group indicated that future savings, social security, employment

generation and social status motivated them to form SHGs.

Table 4.21 Reasons for Participation in SHG

Number of Respondents
Reasons for participating in the
SHG Very Very
Low Moderate High Total
Low High
05 20 96 121
Mobilize saving -- --
(4.13) (16.53) (79.34) (100)
121
13 03 26 23 56
Employment opportunity (100)
(10.74) (2.48) (21.49) (19.01) (46.28)
121
04 05 23 53 36
Regularity in attending meetings (100)
(3.31) (4.13) (19.09) (43.80) (29.75)
121
08 34 79
Access to loan -- -- (100)
(6.61) (28.10) (65.29)
121
Promotion of income generating 02 09 40 70
-- (100)
activities (1.65) (7.44) (33.06) (57.85)
121
Because we have effective 13 07 21 37 43
leadership (10.74) (5.78) (17.36) (30.58) (35,54) (100)

121
28 31 38 19
Involvement of NGOs 05(4.13) (100)
(23.14) (25.62) (31.40) (15.70)
121
02 12 30 40 37
Consumption oriented credit (100)
(1.65) (9.92) (24.79) (33.56) (30.58)
121
01 09 19 45 47
Because I am the Family Head (100)
(0.83) (7.44) (15.70) (37.19) (38.84)
121
Family and personal asset 03 23 27 68
-- (100)
possession (2.48) (10.01) (22.31) (56.20)
121
To reduce old debts before joining 83 02 17 13 06
the group (68.60) (1.65) (14.05) (10.74) (4.96) (100)

121
08 08 15 21 69
My income was very low (100)
(6.61) (6.61) (12.39) (17.36) (57.02)

Source: Primary Data

Note: Figures within the parenthesis show percentages.

84
 Table 4.22 Ranked Reasons for Participation in SHG
Reasons for participating in the SHG Weight Total Mean/
Score Score
Mobilize saving -- -- 15 80 480 575 115
Employment opportunity 13 6 78 92 280 469 93.8
Regularity in attending meetings 04 10 69 212 180 475 95
Access to loan -- -- 24 136 395 555 111
Promotion of income generating activities -- 04 27 160 350 541 108.2
Because we have effective leadership 13 14 15 148 215 405 81
Involvement of NGOs 28 62 114 76 25 305 61
Consumption oriented credit 02 24 90 160 185 461 92.2
Family Head 01 18 57 180 235 491 98.2
Family and personal asset possession 03 -- 69 108 340 520 104
To reduce old debts before joining the group 83 04 51 52 30 220 44
My income was very low 8 16 45 84 345 498 99.6
Source: Primary Data

In order to analyze the reasons for joining Self Help Group, all respondents were asked to

rank the reasons in the order of their importance. The ranks given by them were quantified

using the Garrett Ranking Technique (Garrett, 1969).

Table 4.23 Respondents Reasons for joining SHG

List of Reasons Total Mean

Score Score Rank
Mobilize saving 9630 79.59 III
Employment opportunity 9320 77.02 X
Regularity in attending meetings 9454 78.13 IX
Access to loan 9487 78.40 VII
Promotion of income generating activities 9461 78.19 VIII
Effective leadership 9522 78.69 VI
Involvement of NGOs 9761 80.67 II
Consumption-oriented credit 9486 78.40 VII
Family Head 9568 79.07 V
Family or personal asset position 9585 79.21 IV
To reduce old debts before joining the group 10051 83.07 I
Source: Primary Data

The result indicates as shown in the table 4.23 the top five reasons for joining SHG were

to reduce old debt, involvement of NGO, mobilizing saving, family or personal asset

85
possession and family head in the order of importance sequentially from highest to lowest.

Other research findings for example by Lakshmi R. and Vadivalagan G. (2010) concluded

that to raise status in society is the prime reason for respondents joining the SHG,

followed by to promote income generating activities. The next reason was to get a loan.

The fourth reason was to promote savings and the next reason was to repay old debts to

maintain house expenditure which stood as the last reason for joining the SHG.

4.5. Factor Determining the Success of SHG

In order to determine the factor determining the success of SHG factor analysis was

carried out. The variables considered were number of members, Age, regular meeting per

month, loan up to now, clear all debts up to now, capital at establishment, current capital,

other business services in the same area, members saving culture, teamwork, attitude

towards self-employment, managing conflict, group decision making, financial support

from any NGO, non-financial support from voluntary individual, non-financial support

from NGO, non-financial support from government, non-financial support from other

SHGs and educational status.

The "Component Matrix,” as shown in the table 4.24, gives the factor loadings. This is the

central output for factor analysis. The factor loadings, also called component loadings in

Principal Component Analysis (PCA), are the correlation coefficients between the

variables (rows) and factors (columns). Factor loadings are the basis for assigning a label

to the different factors. Loadings above ±0.50 are usually considered "high" and those

below ±0.40 are "low". For that reason non-financial support from government, managing

conflict, clear all its debts up to now, team work, Attitude towards self-employment, non-

financial support from voluntary individuals, financial support from any NGO, current

capital, Non-financial support from any NGO have the highest factor loading that

86
contribute significantly for the success of SHG. Other business services in the same area,

capital at the establishment, non-financial support from other SHGs, loan and age are in

the second group of factors that contribute the success of SHG.

Table 4.24 Factors Determining the Success of SHG (Component Matrixa )

Component
List of Variables 1 2 3 4 5
Non-financial support from government -0.755 0.425
Managing conflict 0.648
Clear all its debts up to now 0.636 0.566 0.421
Team work 0.632 -0.426
Attitude towards self-employment 0.597 -0.430 0.449
Non-financial support from voluntary -0.571 0.559
individuals
Financial support from any NGO 0.556 0.501
Current capital 0.522 0.444
Non-financial support from any NGO -0.421
Other business services in the same area 0.741
Capital at the establishment -0.719 0.427
Non-financial support from other SHGs 0.693
Loan 0.603 0.608
Age 0.474 0.472
Saving culture of members -0.741
Regular meeting per month 0.565
Group decision making 0.455
Number of members of the SHG 0.757
Educational status 0.412
Extraction Method: Principal Component Analysis.
a. 5 components extracted.
Source: Primary Data

87
Table 4.25 Factors Determining the Success of SHG (Rotated Component Matrixa )

Component
List of Variables 1 2 3 4 5
Clear all its debts up to now 0.930
Loan 0.878
Current capital 0.631 0.439
Team work 0.618 0.510
Educational status -0.416
Attitude towards self-employment 0.777
Non-financial support from voluntary -0.706 0.531
individuals
Saving culture of members 0.650
Age -0.554 -0.439
Non-financial support from other SHGs 0.785
Other business services in the same area 0.756
Non-financial support from government -0.445 0.750
Managing conflict 0.447 -0.594
Capital at the establishment 0.723
Group decision making 0.690
Regular meeting per month 0.677
Number of members of the SHG 0.798
Financial support from any NGO 0.746
Non-financial support from any NGO -0.625
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
Source: Primary Data

Rotated component matrix as shown in the table 4.25 confirm the above facts in such a

way that clear all its debts up to now, loan, current capital, team work, and educational

status are that top five factors contributing to the success of SHG. Attitude towards self-

employment, non-financial support from voluntary individuals, saving culture of members

and age are in the second group of factors contributing to the success of SHG. Non-

financial support from other SHGs, other business services in the same area, non-financial

support from government, managing conflict are in the third group of factors that may

contribute for the success of SHG.

88
Anuradha (2012) concluded after performing factor analysis that socially viable

(Recognition in community, literacy level, Access to credit and health, voicing concern),

Personality outlook (Nutrition awareness, decision making related to child centered &

money centered, participation in development programs and Increase in confidence level),

Economically strong (Ownership of physical assets like house and land and the variable

improved relationship with husband), Living standards (Three variables namely change in

personal financial position, change in share in family income and recognition in family),

Accessibility (Better interaction to outsiders, access to credit and asset building) groups of

factors (variables) play a significant role in changing the socio-economic conditions of

women through the formation of Self Help Groups and contributes to the women

empowerment, thereby leading to sustainable development.

4.6. Findings of Focus Group Discussion

The purpose of Focus Group Discussions (FGD) was to gain knowledge about women

participating in SHG and cross check the impact of SHG in reduction of urban women

poverty by interviewing a group of people who directly involved with SHG organizing

activities and community workers. Thus, FGD help to capture opinions and perspectives

of others who are not directly participated and benefited from SHG but rather closely

support SHG. The participants in this FGD were project coordinators and facilitators and

community workers from each sub cities. The outcome FGD was summarized hereunder.

Importance of urban poor woman’s participation in SHG

The first and the most significance of SHG for urban poor women is it helps women to

change their attitude. Before joining SHG women think that they don‟t have any economic

contribution in the family as well as in the community. In addition culturally women were

suppressed to think that they only depend on men and or their husband for their needs.

89
After women join SHG they are released from such attitude and realize that they have

potential and can contribute for the overall improvement of their family. Before

participating in SHG women believe that poverty in a curse on them from their ancestors

and because of SHG women now understood that poverty is not a curse from their

ancestors that cannot be reversed if they work hard.

Through SHG women have been empowered as result they are now their own social,

economic and family judges and decision makers. Because women participate in SHG

now they are income generators and free from dependency so they become economic

contributors for their family. Women understood the importance of saving and small

amount of saving can create wealth. Women attitude towards work was changed so that

they started to create jobs rather than wait for jobs to come to their door. Through training

and awareness creation programs women got a chance to learn new things regarding their

social harmony and cooperation, income generating activities, importance of saving,

access to loan and many more.

Problems/ constraints for the participation of women in SHG

Though there is a huge impact due to the participation in SHG, still most of the women in

urban Hawassa have not participated in SHG. Hence it is essential to trace out their

constraints which hider the women in participation of SHG. The most prohibiting

problems identified through this response for the participation of women in SHG are:

 Lack of awareness regarding load and fear of indebtedness.

 Women attitude towards NGOs. Involvement of NGOs in organizing SHG

conditioned women to expect free handout rather than saving to create their own

business. Because of bad experiences recurring relief donations women have a

habit of getting everything as gift not as loan.

90
  Women attitude that poor cannot save and even if they save it may not have a

meaningful impact on their life.

 Lack of awareness regarding saving. Fear of losing what they save thinking

someone in the group might take it and use it for personal benefit.

 Many of the group members were duplicating income generating activities of

others that is a challenge in a small limited market.

Respondents’ opinion on factors determining the success of SHGs

There are a number of factors determining the success of SHG such as:

 Educational background of SHG members. There should be at least a number of

members can read and write.

 Group homogeneity. In order to have successful SHG group harmony plays a

significant role so average age of members, economic status, proximity of

members village or home, previous knowledge about each other before joining

SHG are some of the list.

 Having effective and committed leaders among members.

 Social Harmony. Group members‟ social cooperation and interaction to support

one another in time of need such as sickness, in case of mourning, celebrations.

 Government none financial support and provision of strong law enforcement to

protect women against gender discrimination.

 Effective group decision making experience, conflict management and handling,

experienced problem solving and respect for each other.

 Progressive saving culture, easy and efficient access to loan, well-structured loan

recovery.

91
 Group members‟ willingness and commitment to comply with SHG agreed up on

bylaw.

 Group members‟ unreserved stand for SHG principles and objectives.

92
 CHAPTER - V

CONCLUSION AND RECOMMENDATIONS

5.1. Conclusion

Ethiopia suffers from poverty, GDP per capita is one of the lowest in the world, and the

economy faces a number of serious structural problems. Ethiopia‟s economy is based on

agriculture, which accounts for 41percent of GDP and 85 percent of total employment

(African Economic Outlook, 2012). Urban residents are more dependent on cash incomes

to meet their essential needs; income poverty is compounded by inadequate and expensive

accommodation, limited access to basic infrastructure and services, exposure to

environmental hazards and high rates of crime and violence. This gives urban poverty a

distinctive gendered dimension as it puts a disproportionate burden on those members of

communities and households who are responsible for unpaid care work. In general, the

government can directly help those in need. However, another method in helping women

to fight poverty is through SHGs. SHGs tries to fight poverty and bring opportunities to

the poor women in many countries like Ethiopia. Of course, microfinance approaches in

Ethiopia play their part in offering solutions to reduce poverty. In recent days SHGs have

been considered as an alternative mechanism to reduce poverty in addition to other

interventions. Due to lack of available evidence this study was carried out to assess the

impact of SHG in reduction of urban women poverty.

Through applying a mix of quantitative and qualitative research methods, this research has

been able to determine the impact of self-help group in the reduction of urban women's

poverty. The study explored answers for the questions, whether participation in the SHG

enhances the socioeconomic capacity of urban poor women, improve access to resources

and participation in economic decision making, individual skill development, women‟s

93
awareness and knowledge regarding saving and income generating activities or not? In

addition the study investigated the factors determining women to participate in SHG and

contributing to the success of SHG. The results of the study listed in the following section.

Sample women respondents of this study confirmed that their knowledge and awareness

has increased regarding SHG, personal and environmental hygiene has also improved after

they join SHGs. Also awareness regarding prenatal care, sanitation and safe water,

importance of child education, literacy, food and balanced diet, group stability and

cohesiveness, social cohesiveness, child abuse and protection has increased after joining

SHG. Further they knew also the importance of membership and saving culture.

The study has demonstrated that involvement in SHG leads to improvement in the

household income that contributes a great deal to poverty reduction in urban poor women.

Saving was unthinkable for most respondents before joining SHG; however, it was

confirmed that respondents saving has increased significantly after joining SHG. Access to

loan from SHGs empowered and motivated women to work and contribute to the family.

They avoided loan from individual money lenders with high interest rate on the other hand

loan from saving and credit associations and SHG have significantly increased. The study

confirmed that respondents‟ housing condition has also improved in terms of the number

of rooms and the capacity of paying for rent after joining in SHG. In general, the capacity

of paying for food, medical treatment, transportation, electric power and piped water has

significantly increased after joining SHG. Frequency of meal per day with each family has

improved substantially.

The factor analysis result shows that the variables that contribute to the success of SHG

are clear all its debts up to now, loan amount, current capital, team work, and educational

status that are top five factors contributing to the success of SHG.

94
As women economic independence, knowledge and awareness improved in general when

women are empowered that boosted social involvement in decision making. The findings

also confirmed that before women join SHG decisions were dominated by male; however,

after joining SHG women's participation in family decision making has improved and

shared decision making increased considerably.

Through SHG poverty is reduced considerably; therefore, women SHG members are

economically independent and their contribution to household income was also increased.

The study conclude that due to the participation in SHGs poverty has reduced but it is not

up to the extent to cover all aspects of poverty reduction for this reason the following

recommendations are forwarded.

5.3. Recommendations

 Responsibilities of organizing SHG should not be vested with NGOs only.

Development Bank of Ethiopian, Microfinance Institutes and each sub cities

should work hand in hand by creating a link to one another to address more women

who are under poverty in Hawassa city live at the peripheries of the city.

 SHG organizing NGOs concentrate their activities in providing training in the

development of business plans and guidance about how best to avoid redundancy

or unnecessary duplication of projects and activities. This implies that there is a

need to impart better entrepreneurship skills and technical know-how to increase

their confidence about income generating activities with innovation and to improve

their social status. In order to do this an assessment should be made on training

effectiveness and impact of trainings that were delivered to SHG members and

there should be a need based training to address women problems.

95
 There are successful SHGs in Hawassa at the same time unsuccessful SHGs as

well. So that in-depth comparative analysis needs to be done in order to come up

with a new way of organizing and implementing SHGs as well as to understand the

challenges and constraints of SHGs.

96
References

Abdullah, 2010, The Main Causes of Poverty in The Low-Income Countries, Published by
Talk 2 All, UK

Angel A., 2012, „Women Entrepreneurship through Self-Help Groups: A Case Study of
Tirunelveli District, Tamil Nadu‟, International Journal of Research in
Commerce, Economics and Management (IJRCM), Volume NO. 2 (2012),
ISSUE NO. 2 (February) ISSN 2231-4245

Anand Gopalan, 2006, A Report on The Development of Socio-economic Protection

System through Self Help Group: A Myth or Reality in India, Institute of South
Asian Studies(ISAS), ISAS internship Program 2006.

Anjugam M. and C. Ramasamy, 2007, Determinants of Women‟s Participation in Self-

Help Group (SHG)-Led Microfinance Programme in Tamil Nadu, Agricultural
Economics Research Review Vol. 20 July-December 2007 pp 283-298

Anuradha.Ps, 2012, „An Empirical Study on Socio-Economic Empowerment of Women

Through Self- Help Groups‟, International Journal of Research in Commerce,
Economics and Management (IJRCM), Volume No. 2 (2012), ISSUE No. 1
(JANUARY) ISSN 2231-4245

Amutha D, 2011, „An Analysis of Economic Empowerment of Women Self Help Groups
in Tuticorin District‟, Journal of Advances in Developmental Research 2 (2)
2011: 227-232

Akin L., 2005, Global Urban Poverty Research Agenda: The African Case, presented at a
seminar on “Global Urban Poverty: Setting the Research Agenda”, Woodrow
Wilson International Center for Scholars, Washington D.C., December 15, 2005

Benyam Asfaw., 2009, Inducing collective action through the promotion of Self Help
Groups-The Indian experience and lessons for Ethiopia, M.A Thesis, University
Read UK.

Bezabih Tolossa., 2007, Assessing the Socio-Economic Impact of Self Help Group: A
Case to Ethiopian Kale Heywet Church Nazret integrated Urban Development
Project, MA Thesis, Addis Ababa University.

Bharath R.A (2005), Assessment of Self Help Groups Promoted Under NATP on
Empowerment of Women in Agriculture , MSc Thesis, College of Rural Home
Science University of Agricultural Science, Dharwad, August 2005

Billy A. J., M. Craig ,2009, Selected Factors Affecting the Performance of Women‟s Self-
Help Groups in Western Kenya, Proceedings of the 25th Annual Meeting,
InterContinental San Juan Resort, Puerto Rico, University of Missouri-
Columbia

97
Brinda , (2013), Socio Economic Empowerment of Women through Self Help Groups in
Villupuram District, Ph.D Thesis, India, February 2013

Caroline M. et al, 1996, Urban Management and Poverty reduction, Washington D.C,
USA, working Paper No. 5, September 1996

Chandralekha G. and Tanmoyee B., 2010, Self Help Group Participation and Employment
of the Women: Myths and the Reality, Proceedings of FIKUSZ ‟10 Symposium
for Young Researchers, Published by Óbuda University Keleti Károly Faculty
of Business and Management, Tavaszmezı u. 15-17. H-1084 Budapest, Hungary

Chinsung Chung, 2012, Study on the Promotion of Human Rights of the Urban Poor:
Strategies and Best Practices, UN, A/HRC/AC/9/3 Right to food of the Human
Rights Council Advisory Committee.

Central Statistical Agency (CSA), 2012, Ethiopia Demographic and Health Survey 2011,
Addis Ababa, Ethiopia

Central Statistical Agency (CSA), 2012, Key Findings on the 2012 Urban Employment
Unemployment Survey, Addis Ababa, Ethiopia

Central Statistical Agency (CSA), 2012, Ethiopian Welfare Monitoring Survey 2011
Summary report, Addis Ababa, Ethiopia

Chandrashekar H. M. and Lokesh M. U, 2009, Role of SHGs in socio-economic change

of vulnerable poor, International NGO Journal Vol. 4 (4), pp. 127-131, April
2009

Dabali S. D., 2010, Socio-Economic Evaluation of Women Self- Help Group in Northern
Karnataka, Ph.D Thesis, University of Agricultural Sciences, Dharwad

Devaltha C.M., 2005, Profile Study of Women Self Help Group in Gadad District of
Northern Karnataka, M.Sc. Thesis, University of Agricultural Sciences,
Dharwad, India

Disney R., A. Kedir and A. McKay, 2004, Price Deflators and Food Poverty in Urban
Ethiopia, Disney, School of Economics, University of Nottingham, UK

Donelson R. Forsyth, 2006, Group Dynamics, Thomson Higher Education, 10 Davis

Drive, Belmont, Fourth Edition, Thomson Learning, Inc. USA

Elisa, 2008, Urban Poverty in Ethiopia: A Multi-faceted and Spatial Perspective, The
International Bank for Reconstruction and Development/The World Bank,
Washington D.C

Esubalew Alehegn, 2006, Determinants of Urban Poverty in Debre Markos, Ethiopia: A

Household Level Analysis, MA Thesis, Addis Ababa University, Ethiopia

98
Feleke Tadele, Alula Pankhurst, Philippa Bevan and Tom Lavers, 2006, Migration and
Rural-Urban Linkages in Ethiopia: Cases studies of five rural and two urban
sites in Addis Ababa, Amhara, Oromia and SNNP Regions and Implications for
Policy and Development Practice, ESRC WeD Research Programme, University
of Bath, United Kingdom

Florescu C., 2009, Women‟s Access to Credit, Income Generation and Adult Education in
Ethiopia: Evaluating the Women‟s Self Help Group, The George Washington
University School of Public Health and Health Services Department of Global
Health Culminating Experience Project.

Getachew Zewdie, 2012, An Assessment of the Socio-Economic Impacts of Self Help

Groups among Women in Hawassa City, SNNP Region, Ethiopia, MA Thesis,
Hawassa University.

Gurupandi M., 2012, Factors Influencing the Effective Functioning of the Self-Help
Group - an Analytical Study, International Journal of Research in Commerce,
Economics and Management(IJRCM), VOLUME NO. 2 (2012), ISSUE NO. 2
(FEBRUARY) ISSN 2231-4245

Hawassa City Administration Finance & Economy Development, 2012, Socio-Economic

Profile (2003E.C.), Data Collection & Dissemination work-process, Hawassa,
Ethiopia

Jaya S., 2002, Self-Help Groups in Empowering Women: Case study of selected SHGs
and NHGs, Kerala Research Program on Local Level Development Centre for
Development Studies Thiruvananthapuram, Discussion Paper No. 38

Jaya S., 2004, Addressing Poverty through Self-Help Groups: A Case Study, Conference
Theme: The Role of Public Administration in Alleviating Poverty and
Improving Governance, Network of Asia-Pacific Schools and Institutes of
Public Administration and Governance (NAPSIPAG), 6-8 December 2004
Kuala Lumpur, Malaysia

Jael van der Heijden, 2006, Sustainability and Empowerment through SHG federations – a
study in East Uttar Pradesh, India, MA Thesis, International Development
Studies (IDS), Universiteit van Amsterdam

Klaus D. and Yanyan L., 2008, Economic and Social Impacts of Self-Help Groups in
India, Selected Paper prepared for presentation at the American Agricultural
Economics Association Annual Meeting, Orlando, FL, July 27-29, 2008.

Karmakar, K.G. (1999), Rural Credit and Self-Help Group, Micro finance Needs and
Concept in India, Sage publication, New Delhi

99
Lina J. et al., 2008, Determinants of Group Performance of Women-led Agro-processing
Self-help Groups in Kerala, Agricultural Economics Research Review, Vol. 21
(Conference Number) 2008 pp 355-362

Lakshmi.R and Vadivalagan.G, 2010, Impact of Self Help Groups on Empowerment of

Women: A Stusy in Dharmapuri District, Tamilnadu, Research and
development centre, Bharathiar University, Coimbatore, India, March, 2010

MYRADA, 2002, Impact of Self Help Groups (Group Processes) On the

Social/Empowerment Status of Women Members in Southern India, Paper
presented at the Seminar on SHG-bank Linkage Programme at New Delhi on
25th and 26th November 2002

Meron Assefa, 2003, Female-Headed Households and Poverty in Urban Ethiopia, MSc.
Thesis, Addis Ababa University.

Mark R., 2009, Urban Poverty and Health in Developing Countries, Population Reference
Bureau 64.2

Ministry of Finance and Economic Development (MoFED), 2010, Growth and

Transformation Plan, Addis Ababa Ethiopia

Ministry of Finance and Economic Development (MoFED), 2012, Ethiopia‟s Progress

towards Eradicating Poverty: An Interim Report on Poverty Analysis Study
(2010/11), Addis Ababa Ethiopia

Ministry of Finance and Economic Development (MoFED), 2010, Ethiopia: 2010 MDGs
Report Trends and Prospects for Meeting MDGs by 2015, Addis Ababa
Ethiopia

Rebecca Tunstall, et.al, 2013, The Links between Housing and Poverty: An Evidence
Review, Joseph Rownttee Foundation, JRF Report, April 2013

Shreedevi S., 2012, Women Empowerment Through Self Help Groups, Indian Streams
Research Journal, Vol.2,Issue.III/April; 12pp.1-4 ISSN:-2230-7850

Saikumar C., 2009, Measure of Social Performance and Determinants Influencing the
Repayment Status of Self-Help Group Microcredit Delivery Models in India -
An Econometric Study, Ph.D Thesis, Division of Cooperative Sciences,
Department of Agricultural Economics, Humboldt University, Berlin

Sanjay K., March 2012, Socio-Economic Empowerment of Women through SHG-

Banking Linkage Program: A Boon for Development, Lumding College,
Lumding, Assam, India, ISSN: 2230-9519 (Online) | ISSN : 2231-2463 (Print)
IJMBS Vol. 2, Issue 1, Jan. - March 2012

100
Sowjanya, 2007. A Comparative Analysis of Successful and Unsuccessful Self-Help
Groups in Gadag District of Karnataka, M.Sc. Thesis, University of
Agricultural Sciences, Dharwad

Sundaram A., 2012, „Impact of Self-help Group in Socio-economic development of India‟,

IOSR Journal of Humanities and Social Science (JHSS), ISSN: 2279-0837,
ISBN: 2279-0845. Volume 5, Issue 1 (Nov. - Dec. 2012), PP 20-27

Sumitra B. and Dukhabandhu S., 2008, Self-Help Group for Poverty Alleviation: A Case
Study of Titabor Sub-Division of Jorhat District of Assam, Assam University,
Silchar

Suresh Kumar D., 2009, Participation in Self-help Group Activities and its Impacts:
Evidence from South India, The Bangladesh Development Studies Vol. XXXII,
September 2009, No. 3
Shubham C., 2003, Assessing vulnerability to poverty: concepts, empirical methods and
illustrative examples, Department of Economics, Columbia University

Shylendra H.S & Gujarat, 1998, Promoting Women’s Self Help Groups: Lessons from an
action research project of IRMA

Singh Y.K., et al., 2007, Performance of Women‟s Self- Help Groups (SHGs): In District
Moradabad, U.P., International Journal of Rural Studies (IJRS), vol. 14 no. 2
Oct 2007, ISSN 1023–2001

Stiglitz, Joseph E, 1993, Peer Monitoring and Credit Markets in Karla Hoff, et al (Eds)
The economics of rural organization, Ney York; Oxford University Press

Suguna, 2006, Empowerment of Rural Women Through Self Help Groups, Discovery
Publishing House, New Delhi, India

United Nations Development Programme (UNDP), 2012, Africa Human Development

Report 2012 towards a Food Secure Future, New York, USA

United States Agency for International Development (USAID), 2007, Urban Poverty
Setting the Agenda, Washington, D.C., USA

United Nations Human Settlements Programme (UN–HABITAT), 2011, Affordable Land

and Housing in Africa, Nairobi, Kenya

United Nations Human Settlements Programme (UN–HABITAT), 2011, Urban World:

Waiting for Solution, Nairobi, Kenya

United Nations Population Fund (UNFPA), 2012, Urbanization, Gender and Urban
Poverty: Paid Work and Unpaid Care Work in the City, New York, USA

101
Wale V.S.. & Deshmukh A.M., 2011, Women Empowerment through Self-help Group,
Indian Stream Research Journal Vol - I, ISSUE – IV)

Websites

New World Encyclopedia (March 4, 2013),

http://www.newworldencyclopedia.org/entry/Poverty

Business Dictionary, (March 4, 2013).

http://www.businessdictionary.com/definition/poverty.html#ixzz2MZWWj8Lk(March 4,
2013)

(UNESCO, March 4, 2013). http://www.unesco.org/new/en/social-and-human-

sciences/themes/international-migration/glossary/poverty/ (cited on March 4, 2013).

UNFP (http:// www.undp.org/africa/ poverty.shtml)

www.familyfact.ord (cited May 3, 2013)

CIA World Factbook, 2010 (cited March 23, 2013)

http://www.photius.com/rankings/population/urbanization_rate_of_urbanization_2010_1.html

102
 Appendix

Annex I: Structured Interview Schedule (For SHG members)

Hawassa University, School of Graduate Studies
College of Business and Economics
Department of Cooperatives
M.A. Cooperatives Development and Leadership
Structured Interview Schedule
1. PERSONAL DATA
1.1. Address: Kebele: _______ House NO. ________
1.2. Age:
18 -25 26-35 36 -45 46-55 above 56
1.3. Sex: ____________
1.4. The highest completed grade (Education): ______________
Illiterate Write and read grade1 - 4 grade 5-8 grade 9 -10
vocational Certificate Diploma and above
2. FAMILY DATA
2.1. Marital Status:
Now Married Not Married Divorced Separated by Death
Single
2.2. Types of family
Nuclear Extended Single Parent Compound Type
2.3. Total members of your family: ___________
2.4. Who is the head of your family: ________________________
2.5. Number of children: _____________
2.6. Activity status of your children
Small children (not in school) school going working
children
2.7. Number of family members who are in school now:
Adult (18 years and above) Children (below 18 years)
3. EMPLOYMENT AND INCOME
3.1. List of your main occupation

Before joining SHG After joining SHG

103
 3.2. Subsidiary employment:
Before joining SHG after joining SHG

3.3. Approximate monthly income:

Before joining SHG after joining SHG

3.4. Who take decisions in your family?

Before joining SHG After joining SHG(or)

Joint Joint
Decisions on Both Family Both Family
Family SHG
Personal Family SHG & SHG Personal & SHG
members
members members members
Loan from SHG
Loan from Bank
Loan from
Saving and credit
association
Loan amount
Loan utilization
Saving amount

4. Household Economic status

4.1. What is/are the source/s of family income?

Before joining SHG after joining SHG

4.2. Do you have child/children, or relative abroad? Yes No

4.3. If yes, are they contributing financially for the family? Yes No

104
 4.3.1. If yes, How much per year?
4.4. How many household members contribute to the family income? ____________
4.5. Estimated average monthly income of the household earned by all members of the
household:
Before joining SHG after joining SHG

4.6. How much amount do you save?

Before joining SHG after joining SHG

4.7. Means of savings and amount

Means of savings Saving amount before SHG Saving Amount after SHG
Individual saving account at bank

Credit and Saving

Association
SHG
Cooperative Bank
Equb
Others

4.8. Have taken loan? If yes, how much and from which institute.
Loan taken from Loan amount before joining Loan amount after joining SHG
SHG
Individual money lenders
Saving and credit association
SHG
Bank
Kebele
NGO (micro finance
institutes)
Other

4.9. Reasons for taking loans

1. 2
3

105
 4.10. Amount of Loan repaid
Before joining SHG after joining SHG

4.11. Do you pay the installments regularly?

Before joining SHG after joining SHG

4.12. Availability of household items

Items Before SHG After SHG
Radio
Tape Recorder
TV
DVD player
Chair and table
Sofa
Bed for adults(separate from
children)

Bed for children

Refrigerator
Bicycle
Motor bicycle
Three-wheeler (Bajaj…)

5. AVAILABILITY OF BASIC FACILITIES AND SERVICES

5.1. Do you own or rent your house?
5.1.1. If rented, from whom: Government institution privet
renters
5.1.2. How much is paid monthly?
Before joining SHG after joining SHG

5.2. How many rooms are in your house?

Before joining SHG after joining SHG

106
 5.3. From where do you get water? ,
Before joining SHG after joining SHG
Piped water directly to house Piped water directly to house
P P
Outside tap(within yard but outside Outside tap( within yard but outside
house) house P
P
Piped water to (public) collection Piped water to (public) collection
point P point P
Bore hole Bore hole
P P
Other Specify Piped water Other Specify Piped water

5.3.1. How much you pay for piped water monthly?

Before joining SHG after joining SHG

5.4. Do you have electric power in your house?

Before joining SHG after joining SHG

5.4.1. How much is your monthly expenditure for electric power?

Before joining SHG after joining SHG

5.5. Types of toilet you use?

Before joining SHG after joining SHG
Simple Pit latrine privet Simple Pit latrine privet
Simple pit latrine communal Simple pit latrine communal
Ventilated Improved pit latrine privet Ventilated Improved pit latrine privet
Ventilated Improved pit latrine communal Ventilated Improved pit latrine communal
In house toilet In house toilet
Flush toilet Flush toilet
Others Others

107
6. Food and nutrition
6.1. Meals and snacks par day before joining SHG? one time Two Times
Three times More than three times
6.2. Meals and snacks par day after joining SHG? one time Two Times
Three times More than three times
6.3. What do you use for cooking food before joining SHG?
Fire wood/charcoal kerosene Electric Gas
Other (indicate)
6.4. What do you use for cooking food after joining SHG?
Fire wood/charcoal kerosene Electric Gas
Other (indicate)
6.5. How much do you spend per month for cooking?

Before joining SHG after joining SHG

6.6. How much does your family spend per day for food?
Before joining SHG after joining SHG

7. Health, Medical care and treatment

7.1. What are the major medical problems of the family before joining SHG?
Intestinal Parasite Malaria Dental Decay Tuberculosis
Skin infection Diarrhea Goiter Marasmus
Others:

7.2. What are the major medical problems of the family after joining SHG?
Intestinal Parasite Malaria Dental Decay Tuberculosis
Skin infection Diarrhea Goiter Marasmus
Others:

7.3. Where do you get medical care before joining SHG?

Government medical Centers Government Hospital Privet
Clinic

108
Privet Hospital Use traditional Medicine

7.4. Where do you get medical care after joining SHG?

Government medical Centers Government Hospital Privet
Clinic
Privet Hospital Use traditional Medicine

7.5. How much do you spend for treatment and medicine per month?

Before joining SHG after joining SHG

8. Access to Transportation
8.1. Means of transportation you are using
Before joining SHG
Means of walk Tri wheeler Mini City Bus Other
transportation (Bajaj) Bus bus
To Work
To School
To health center
To market place

After Joining SHG

walk Tri wheeler Mini City Bus Bicycle Other
(Bajaj) Bus bus
To Work
To School
To health center
To market place

8.2. Do you need to use transportation regularly?

Before joining SHG after joining SHG
To work To work

109
 To School To School
To Health Center To Health Center
To market place To market place

8.3. Can you afford transportation?

Before joining SHG After joining SHG
(Yes or no) (Yes or no)

8.4. How much are you spending for transportation per month?
Before joining SHG after joining SHG

9. Political and legal aspect

9.1. Do you know what services you get from government?
Before joining SHG After joining SHG
(Yes or no) (Yes or no)

9.2. List services you get from government?

a.
b.
c.
9.3. Do you know about legal services (your basic rights)?
Before joining SHG After joining SHG
(Yes or no) (Yes or no)

9.4. List your basic rights?

a.
b.
c.
10. PARTICIPATION
10.1. What motivate you to participate in SHG?
Saving Access to lone Trainings Employment Other

10.2. Are you participating in regular meetings of your SHG?

110
Seldom Sometimes often most of the time almost
always
10.3. Are you participating it trainings prepared for SHG?
Seldom Sometimes often most of the time almost
always
10.4. Are you involved in some other credit and saving program? Yes
No
10.5. Are you or member of your family supported by any NGO? Yes
No

10.6. How long have you been a member a member of SHG?

1 – 3 Years 4 – 6 Years 7 – 9 Years 10 Years and above

10.7. Rank in the order of importance factors that determine your participation in
SHG
Reasons for joining SHG Rank
Mobilize saving
Employment opportunity
Regularity in attending meetings
Access to loan (from the group, NGO, Gov. Bank, Microfinance institute …)
Promotion of income generating activities
Effective leadership
Involvement of NGOs
Consumption-oriented credit
Family Head
Family or personal asset position
To reduce old debts before joining the group (members who had previous debts
from the informal sources
10.8. The reasons for participation in the SHG
Sr. # List of possible Reasons Very High Moderate Low Very
High Low
1 Mobilize saving
2 Employment opportunity
3 Regularity in attending meetings
4 Access to loan (from the group, NGO, Gov. Bank,
Microfinance institute …)
5 Promotion of income generating activities
6 Because we have effective leadership
7 Involvement of NGOs

111
8 Consumption-oriented credit
9 Because I am the Family Head
10 Family or personal asset position
11 To reduce old debts before joining the group
(members who had previous debts from the
informal sources
12 My income was very low
10.9. What other reasons for participation in the SHG you may have:
1.

2.

11. Awareness
11.1. Types of training available
1.
2.
3.
Awareness Descriptions Same as before joining Increased after Joining
SHG SHG
About objectives of SHG
About by laws, rules and regulations of
SHG
About the importance of personal saving
and loan with SHG
Awareness on business plan
Prenatal care
Legal rights
Sanitation and safe water
Awareness on importance child education
Awareness about literacy
Awareness on food and balanced diet
Importance of financial recording
Awareness on IGA Skills
Awareness on group stability and
cohesiveness
Awareness social cohesiveness
Current Political system
Child abuse and protection

11.2. Knowledge Change

Awareness Descriptions Same as before joining Changed after Joining
SHG SHG
Knowledge in personal hygiene
environmental hygiene

112
Knowledge in family planning methods
Knowledge in reproductive health and
STD

12. Changes due to SHG participation and access to resource

12.1. How do you explain change in your family income after you join SHG?
Very much increased increased same decrease very much
Decreased
12.2.Is there any change in your workload? How do you compare your workload before
you involve in the SHG and after? (Amount of work for the same wage, if you are
employed)
Very much increased increased same decrease very much
Decreased
12.3.After you join SHG, how is your savings capacity?
Very much increased increased same decrease very much
Decreased
12.4.After you join SHG, how is your borrowing capacity?
Very much increased increased same decrease very much
Decreased
12.5.After you join SHG, had there been any change in your family‟s consumption
pattern?
Consumption pattern Very much increased Increased same Declined Very much declined
Food
Frequency of meals per day
Clothing
Health care and Medical treatment
children‟s education
Household furniture

12.6.Who decide on:

Decision Making Before SHG After SHG
education of children
family expenditure
asset building
participate in meetings

113
Annex II: Key Informant Interview (SHG Leaders)

Hawassa University, School of Graduate Studies

College of Business and Economics
Department of Cooperatives
M.A. Cooperatives Development and Leadership
Key Informant Interview
Factors determining the success of SHG

1. Number of members of the SHG:

2. Average age of the members of the SHG
3. Marital Status of members of SHG
a. Now married
b. Not Married
c. Single
d. Widowed
4. How many days are you working per week?
5. How many hours are you working per day?
6. How many times are you conducting a regular meeting per month?
7. Members Educational status:
a. Illiterate
b. Literate
c. Grade 1 – 4
d. Grade 5 – 8
e. Grade 9 – 10
f. Preparatory
g. Grade 12(previous)
h. Vocational
i. Diploma and above
8. How many members of this SHG engaged in the same business before membership?

9. How many members do not have knowhow about the business before they join the
SHG?
10. How many times this SHG did take loan up to now?
11. How many times this SHG did clear all its debts up to now?
12. How much was the capital at the establishment?
13. Current capital of the SHG?
14. Do you have an up to date business plan? Yes No
15. Are you regularly keeping your financial activities? Yes No
16. In your observation how would you measure the success of your SHG?
Very Successful Successful No Difference Not Successful
Failed

114
 17. Are there other businesses with the same product or services similar to this SHG in
your working area? Yes No
18. How do you evaluate the saving culture of members
Very good good fair poor very poor

19. How do you evaluate your team work

Very good good fair poor very poor

20. How do you evaluate members attitude towards self-employment

Very good good fair poor very poor

21. How do you evaluate the group in managing conflict

Very good good fair poor very poor

22. How is your group decision making

Very good good fair poor very poor

23. Did you get any financial support from:

a. Voluntary individuals
b. From any NGO
c. From government
d. Other SHGs
e. No support
24. Did you ever get any non-financial support(like: technical and professional
counsel, legal counsel, record keeping, experience sharing…) from:
a. Voluntary individuals
b. From any NGO
c. From government
d. Other SHGs
e. No support

115
Annex III: Focus Group Discussion (Project Facilitators and Community Workers)

Hawassa University, School of Graduate Studies

College of Business and Economics
Department of Cooperatives
M.A. Cooperatives Development and Leadership
Focus Group Discussion
Questionnaire: For Focus group discussion with key informants.
1. What is the importance of urban poor women‟s participation in SHG?
2. What are the problems/ constraints for the participation of women in SHG? What are
the sources for these problems?
4. What do you recommend for further improvement of women‟s participation in SHG?
5. In your perspective what are the factors determining the success of SHGs?

116