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Poverty alleviation is one of the important goals of development planning in post-colonial India and is designed through community development programme. The Self Help Groups (SGHs) are one of such initiatives by National Bank for Agriculture and Rural Development (NABARD). The SHGs are an effective strategy to provide fnancial services to poor women, and offer micro credit for their income generating activities and other non-economic activities targeting improvements in their standard of living. Income is an important variable to study aspects of poverty. Based on a survey conducted in the city of Chennai, this paper tests the effect of SHGs in reducing poverty levels by comparing the level of incomes of the respondents before and after three years of programme intervention. The findings revealed significant improvements in the level of poverty among the respondents.
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