Self-help Groups (SHGs), that typically organize poor, low-educated and low-skilled women in India, can play a key role in improving quality of life among poor communities. Women, especially in rural and peri-urban areas, are often encouraged by state governments to form SHGs, and set up/run micro-enterprises. Typically, state governments provide training to SHGs on elementary skill building, including basic accounting, budgeting etc., but these are often rather basic and have been shown to be ineffective in delivering profitable business outcomes for women (McKenzie and Woodruff, 2014), many of whom are both poor and socially disadvantaged. We argue that a key component of training missing from the current government-led SHG training programmes is psychological empowerment of the SHG members. Improving psychological capabilities of these women micro-entrepreneurs by helping them to build individual and collective agency, self-confidence, aspirations etc. can be of first order importance to run a successful business within a societal context like India, where women face multiple constraints in terms of conservative norms etc that restrict their participation outside home.
In this research project, we propose to test the efficacy of embedding a psychological empowerment module within the existing SHG training package offered by the government on female business and related outcomes.