SHE-Marts & The Next Frontier Of Women-Led Development In India Building Market Ecosystems For Rural Women Entrepreneurs

Policy Update

Tanvi Nerurkar

Introduction

In the last thirty years, rural women’s development in India has gone through several stages. It began with welfare programs focused on nutrition, maternal health, and poverty relief. The 1990s saw the rise of Self-Help Groups (SHGs) that promoted empowerment. Later, the Deendayal Antyodaya Yojana–National Rural Livelihoods Mission (DAY-NRLM) institutionalised women-led development. Most recently, the Lakhpati Didi initiative aims to help SHG members earn a steady annual household income of over one lakh rupees.

Each phase has expanded women’s roles from beneficiaries to savers, to borrowers, and now to producers. Yet creating entrepreneurs has not guaranteed sustained growth. Evidence from rural enterprise programmes shows that most women-led microenterprises remain confined to local markets, weekly haats, and occasional exhibitions; are informal, low-value, and dependent on unpredictable demand; and are often informal, low-value, and dependent on unpredictable demand. Weak branding, poor packaging, fragmented logistics and continued dependence on intermediaries suppress profitability even where production capacity has improved.

This is where SHE-Marts (Self Help Entrepreneurs’ Marts), developed under DAY-NRLM and given fresh impetus in the Union Budget 2026–27, assume significance. Rather than functioning as one more retail outlet, SHE-Marts are conceived as permanent, women-owned market infrastructure that integrates production, aggregation, branding, value addition, and market linkage in place of episodic fairs and exhibitions.

Finance Minister Nirmala Sitharaman announced the initiative in her Budget speech on 1st February 2026, framing it as the next step in the SHG income journey, helping women move from credit-linked livelihoods to enterprise ownership. The announcement was paired with a digital, end-to-end loan system for SHG women, enabling online applications and bank-linked credit approvals, so that improved market access is matched by faster and more flexible working capital.

If SHGs democratised access to finance and Lakhpati Didi promoted entrepreneurship, SHE-Marts seek to democratise access to markets, shifting the policy question from how many women can be brought into enterprise to whether their enterprises can be connected to markets that reward scale, consistency and brand identity. This reading is consistent with Naila Kabeer’s (1999) argument that empowerment requires agency and achievement, not merely access to resources, and with Amartya Sen’s (1999) capability approach, which frames development as the expansion of real choices rather than income alone: sustainable market participation is what lets women exercise genuine control over pricing, investment and household welfare.

This article examines SHE-Marts’ institutional design, early performance, economic and social impact, structural challenges, and the reforms needed to make them sustainable.

Functioning

SHE-Marts act as market-facing institutions within the DAY-NRLM system. They help connect rural producers with consumers while preserving community ownership. Instead of working like typical subsidy programs, SHE-Marts bring together multiple institutions rather than relying on a single agency.

Table 1. Institutional Architecture of SHE-Marts

Figure 1. Institutional Architecture of SHE-Marts under DAY-NRLM

SHE-Marts operate through a multi-channel marketing ecosystem rather than relying on a single retail outlet. Products are aggregated through SHG federations and sold across permanent retail stores, SARAS Melas, district outlets, institutional procurement channels, and selected digital commerce platforms. This diversified marketing structure reduces dependence on seasonal exhibitions while enabling producers to reach a wider and more stable customer base. The emphasis is therefore on building continuous market linkages through community-owned retail infrastructure instead of one-time sales opportunities.

SHE-Marts converge with several existing schemes rather than duplicating them:

Table 2. Policy Convergence Supporting SHE-Marts (Source: Compiled by the author based on MoRD, PIB, NRLM)

This coming together of programs marks a change in policy. Earlier rural livelihood programs mainly focused on production-related issues such as credit, training, and inputs. SHE-Marts, on the other hand, focus on the demand side, connecting to markets, reaching consumers, building brands, and joining value chains. The goal is to create community-owned market systems rather than isolated retail efforts.

Performance & Assessment

Budgetary Commitment

SHE-Marts arrive with a meaningfully larger fiscal envelope behind DAY-NRLM as a whole. The Union Budget 2026–27 raised the programme component of DAY-NRLM by ₹2,880 crore over the 2025–26 revised estimate, taking it to ₹17,280 crore, a roughly 20 per cent increase. Ministerial statements have separately cited the mission’s total 2026–27 allocation at ₹19,200 crore, a figure that likely folds in components beyond the core programme budget; the range across official sources is worth noting rather than resolving into a single number.

SHE-Marts sit within a considerably larger women-centric fiscal package: the overall Gender Budget for 2026–27 stands at ₹1,07,688.42 crore, with 100 per cent of Part A allocated for women and girls, alongside related lines such as ₹3,605 crore for Mission Shakti and ₹676.85 crore for NAMO Drone Didi. The government has set an initial target of reaching approximately 10 million (one crore) beneficiaries under SHE-Marts through these enhanced and innovative financing instruments.

Table 3. Key Allocations Relevant to SHE-Marts and Women-Led Rural Development (Source: Union Budget 2026–27)

Institutional Base

SHE-Marts also build on a substantial institutional base: DAY-NRLM has mobilised over 90 lakh SHGs involving more than 10 crore rural women, making it the world’s largest women-led community institution. The scheme’s income-linked companion, Lakhpati Didi, had already crossed the 3 crore mark, with 3 crore women achieving the ₹1-lakh annual income threshold by mid-2026 ahead of its original March 2027 deadline, prompting the government to set a further target of 3 crore additional Lakhpati Didis, taking the goal to 6 crore, by March 2029. This gives SHE-Marts a ready pipeline of income-qualified producers rather than a base that must be built from scratch.

Institutionally, the initiative is still moving from design to rollout. A two-day National Consultation on SHE-Marts was held on 14–15 May 2026 in Bhubaneswar, Odisha, hosted by the Odisha Livelihoods Mission and facilitated by PRADAN as the national support organisation, bringing together State Rural Livelihood Missions, NABARD and financial institutions to review the draft operational framework covering financing models, governance systems, technology integration and monitoring mechanisms ahead of large-scale rollout. As of early June 2026, financial media reporting on the scheme noted that detailed operational guidelines and funding structures remained awaited at the central level.

Beyond retail infrastructure, institutional procurement is emerging as an important source of stable demand. Partnerships with organisations such as the National Cooperative Consumers’ Federation (NCCF) and State Rural Livelihood Missions can reduce dependence on seasonal consumer markets by creating predictable procurement channels. As implementation progresses, the effectiveness of SHE-Marts will depend less on the number of retail outlets established and more on whether these institutional linkages translate into sustained enterprise revenues.

Performance, however, should not be judged solely by the number of outlets established or by budget outlay. The real test is one that current monitoring does not yet fully capture: whether SHE-Marts improve enterprise profitability, raise producer incomes, and build market access that survives beyond the initial rollout.

Table 4. Traditional SHG Marketing versus the SHE-Mart Ecosystem

The comparison points to a qualitative shift rather than a purely quantitative one from isolated production toward integrated value-chain ownership.

Global performances for Women-Centric Rural Enterprise Models 

Unlike Bangladesh and Kenya, where enterprise support largely revolves around finance and micro-enterprises, India’s SHE-Mart model benefits from an already established institutional ecosystem comprising more than ten crore women organised under DAY-NRLM. This creates opportunities to move beyond microcredit towards collective retail ownership. However, international experiences demonstrate that market competitiveness depends not merely on access to finance but on continuous enterprise mentoring, branding, logistics, and private sector partnerships.

Table 4. Traditional SHG Marketing versus the SHE-Mart Ecosystem

Impact

Economic Impact

The principal economic contribution of SHE-Marts lies in strengthening producers’ bargaining power within rural value chains. Collective procurement, aggregation and retail reduce transaction costs while allowing women-owned enterprises to retain a larger share of consumer spending. Rather than operating as isolated micro-enterprises, SHGs begin functioning as coordinated business networks capable of generating employment in logistics, retail management, inventory handling and local services. 

Financial Inclusion

SHE-Marts regularly use digital payments, business loans, insurance, and bookkeeping, which helps women improve their financial skills and credit ratings. Steady cash flow from retail, unlike the ups and downs of village markets, allows women to invest in technology and grow their businesses with more confidence.

Social Impact

When women own retail businesses, they are seen less as welfare recipients and more as entrepreneurs. This builds their leadership and negotiation skills and gives them a stronger voice in family financial decisions. Owning businesses together also strengthens the trust and teamwork that SHGs have already developed, as women work together on buying, pricing, inventory, and customer relations.

Institutional Impact

SHGs are changing from savings and credit groups into business organisations that handle supply chains, retail, branding, and market growth. Village Organisations and Cluster-Level Federations are also moving from being merely administrative groups to supporting businesses by providing technical assistance, quality checks, and market information. This makes community institutions stronger and less dependent on government support.

Digital Transformation

Digital systems have the potential to improve business transparency and operational efficiency within SHE-Marts. Electronic transaction records, inventory tracking and digital financial management can strengthen enterprise governance while creating credit histories that improve access to formal finance. Over time, these systems can support better business planning and performance monitoring rather than simply expanding online sales. 

Case Studies of Ongoing Models

Uttar Pradesh – Strengthening Market Access

Uttar Pradesh has leveraged SHE-Marts under the State Rural Livelihood Mission to provide SHG products including handicrafts, processed foods, textiles, and millet-based products with organized retail platforms. By reducing dependence on intermediaries and integrating SHGs with SARAS Melas and government-supported exhibitions, the state demonstrates how dedicated marketing infrastructure can improve enterprise visibility and sustainability.

Policy Insight: Retail infrastructure should become an integral component of livelihood programmes rather than an independent intervention. 

Maharashtra – Converging Entrepreneurship with Markets

Maharashtra has integrated its UMED State Rural Livelihood Mission with Lakhpati Didi and SHE-Mart initiatives, connecting women-led enterprises in food processing, handicrafts, and agriculture to organized marketing channels. The state’s experience highlights that entrepreneurship programmes become more sustainable when complemented by structured market access and institutional convergence.

Policy Insight: Enterprise creation must be accompanied by structured marketing ecosystems to ensure sustained income growth. 

Telangana – Advancing Digital Market Integration

Through the Society for Elimination of Rural Poverty (SERP), Telangana demonstrates how institutional capacity building can complement market reforms. Alongside technology adoption, the state has invested in enterprise support systems that help SHGs improve business management, customer outreach and commercial decision-making. 

Policy Insight: Institutional capability is as important as technology adoption in ensuring long-term enterprise competitiveness. 

These state experiences show that sustainable women-led enterprises require more than financial support. Organized retail, policy convergence, digital adoption, and market integration are critical to transforming SHE-Marts into comprehensive market ecosystems rather than standalone retail outlets. 

Emerging Challenges

Income Sustainability

The main question is not just if SHE-Marts can boost sales, but if they can help women earn steady, growing incomes. Many SHG businesses still operate in low-profit sectors such as tailoring, food processing, and handicrafts, making them vulnerable to inflation, seasonal fluctuations, and increased competition. For long-term success, they need to offer a wider product range, innovate, and build a loyal customer base, rather than relying solely on market access. Future reviews should track how many businesses survive, their annual sales, and the stability of their incomes over time, rather than just counting SHE-Marts.

Branding and Market Competition

SHG products often have a strong local identity, but their packaging, certification, and marketing are less robust. This puts them at a disadvantage compared to private retailers, supermarkets, and online platforms that have better supply chains and bigger marketing budgets. Building well-known community brands remains a major challenge for the initiative.

Weak Value Chain Integration

Production, transport, storage, packaging, distribution, and retail often operate independently, which raises costs and creates inefficiencies. Not having enough cold storage also limits how far perishable products like dairy, fruit, vegetables, and processed foods can be sold.

Figure 2. The Rural Value Chain Framework for Women-Led Enterprises (Source: Compiled by the author)

Digital Divide

Technology adoption remains uneven across regions because digital infrastructure alone does not guarantee digital capability. Many women entrepreneurs continue to face constraints in business planning, data management and the commercial use of digital tools. Unless sustained capacity building accompanies technological investments, digitalisation may reinforce existing regional inequalities instead of reducing them. 

Institutional Capacity and Governance

Running a retail business requires skills in business planning, inventory management, customer relationship management, accounting, purchasing supplies, and marketing. These are very different from the skills needed to run a savings group. Many Village Organisations and Cluster-Level Federations have little experience running large commercial businesses.

Regional Disparities

SHGs are at different stages of development across India. States like Kerala, Tamil Nadu, Karnataka, Maharashtra, Andhra Pradesh, and Telangana have strong and experienced community groups. But many central, eastern, and northeastern states have weaker institutions, fewer businesses, and less market infrastructure. Using the same strategy everywhere is likely to lead to uneven results.

Table 4. Key Challenges and Policy Priorities

Way forward

To help SHE-Marts reach their full potential, policies should move from just supporting individual businesses to building complete entrepreneurial ecosystems.

Strengthening Enterprise-Based SHGs

Turning SHGs into Producer Companies, Farmer Producer Organisations (FPOs), and women-owned cooperatives can help them benefit from economies of scale, have more bargaining power, and reach bigger markets. Working together also lowers production costs.

Strengthening Market Intelligence

Future reforms should equip SHE-Marts with better market intelligence rather than merely expanding online presence. Access to consumer demand analysis, regional pricing trends, procurement forecasts and inventory planning can help producer groups make informed production decisions while reducing business risks associated with uncertain demand.

Promoting Value Addition and Branding

The next phase should focus on developing competitive rural enterprises rather than individual products. Professional brand management, quality assurance systems and common business standards should be institutionalised at the federation level so that community-owned enterprises can compete consistently across larger markets while preserving local identity. 

Enhancing Public–Private Partnerships

Support from Corporate Social Responsibility funds, retail chains, hotels, and food companies can help with product development, better packaging, supply chain management, export promotion, and business mentoring. This reduces the need for government support and helps SHE-Marts become more commercially sustainable.

Leveraging Data and Artificial Intelligence

Tools such as demand forecasting, improved inventory management, understanding customer needs, flexible pricing, and market research can help women entrepreneurs make better decisions and reduce business risks.

Outcome-Based Monitoring

Monitoring should go beyond counting SHGs or outlets and focus on outcomes such as the number of businesses that survive, annual sales, repeat customers, women owning registered businesses, exports, job creation, and income growth over 5 years.

Figure 3. The Enterprise-to-Market Ecosystem around SHE-Marts

Conclusion

India’s approach to women-led development has shifted from welfare programs to empowerment, then to promoting entrepreneurship, and now to building market ecosystems. SHE-Marts are an important new policy because they tackle issues that earlier efforts missed, such as sustained market access, branding, and capturing value, not just credit, skills, or starting businesses. The transformative potential of SHE-Marts lies in strengthening the institutions that support women-led enterprises rather than simply expanding retail opportunities.

Their long-term success will depend on whether community organisations evolve into commercially capable business institutions that can compete, innovate and sustain livelihoods without prolonged policy dependence. As India moves toward the goal of Viksit Bharat 2047, the real success of women-led development will depend on how many women can build strong, innovative, and lasting businesses within connected market systems, not just on how many start businesses. If implemented effectively, SHE-Marts can redefine rural development by shifting the focus from enterprise creation to enterprise resilience. 

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About the Contributor

Tanvi is currently working as a Research & Editorial Intern at IMPRI. She holds a Bachelor’s degree in Architecture from VESCOA, University of Mumbai and is presently pursuing a Master’s in Urban Management at CEPT University, where she explores cities through research-driven policy approaches, adaptive governance frameworks, and sustainable development initiatives. Her objective is to contribute implementation-oriented policy research that supports the efficient functioning of cities and creates meaningful value for society at large. 

Reviewers

CB Kavin Adithya

Shreeya Dixit

Acknowledgement 

The author extends her sincere gratitude to the IMPRI team for their invaluable guidance throughout the process.

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