A group of 4 to 20 members can form a self-help group. They develop a habit of savings. The amount so collected is used for disbursement of the loan. Those who do not have formal banking facilities can avail these loans for self-employment and livelihood. The self-help SHG and microfinance is for those who do not have access to formal credit facilities. Self-help groups become the basis for action and change. It also helps to build mutual trust between the promoting organization and the poor through constant contact and genuine efforts. Thus Self-help groups disburse microcredit to the rural and urban poor for the purpose of making them self-reliant and encouraging them to enter into small business activities. The main purpose of this Article is to evaluate the performance of the 5005 Self-help groups and the attitude of members of the Self-help groups towards economic impact, social impact and psychological impact. Self-help groups are necessary to overcome exploitation, create confidence for the economic self-reliance of rural and urban people. These groups enable to come together for a common purpose and gain strength from each other to deal with exploitation, which they are facing in their daily life.