From credit to capabilities: empirical evidence on the impact of microfinance-led interventions on the capability development of tribal women in Gujarat

This study explores the impact of Self-Help Groups (SHGs) on capability development among tribal women in Dahod district, Gujarat. It uses the capability approach to examine how microfinance expands substantive freedoms – such as agency, autonomy, and valued functioning like education and reduced dependency – beyond mere income increases. A mixed-methods analysis of primary data from 360 respondents (180 SHG members and 180 matched non-members) reveals substantial gains for the majority of participants in economic agency, skills, resource access, and moderate improvements in social participation and decision-making. These outcomes highlight SHGs’ role in enhancing women's confidence, networks, and practical abilities to convert resources into meaningful achievements. Persistent barriers include caste discrimination, patriarchal norms, geographic isolation, and limited financial literacy. However, constrain broader transformation, indicating that complementary support in education, healthcare, and infrastructure is essential to deepen capability expansion in marginalized tribal contexts. By shifting the analytical focus from income metrics to capability expansion, this research offers a more nuanced understanding of how microfinance initiatives can potentially address gender inequalities. The findings suggest that future interventions would benefit from designing programs that explicitly target multiple dimensions of women's empowerment rather than treating economic advancement as the sole indicator of success.