Self help groups (SHGs) are important intermediaries between lending institutions and loan seekers who are poor. In the contemporary environment, subsidized lending through SHGs has been emphasized in India. This effort of the government has led to an increase in the number of subsidized SHGs across all the states. However, it has been claimed that SHGs are mainly formed to avail subsidy, and they erode their capital base over time. Furthermore, this has raised questions regarding their long-term sustainability. The present study, therefore, attempted to unveil the sustainability aspect of subsidized SHGs in North East India and compared the same with those of non-subsidized SHGs and found out the status of financial performance and sustainability of each of the entities. The study mainly focused on one of the eight sister states of North East India, that is, Meghalaya from which four districts were considered for the present study by considering a total sample of 150 subsidized and 50 non-subsidized SHGs. Besides, business and loan performance ratios, operational self sufficiency ratio (OSSR), and financial self sufficiency ratio (FSSR) were calculated to find the sustainability position of each of the entities. Among the statistical tools, regression analysis was used to examine the impact of subsidy on the sustainability of subsidized SHGs. The results at the end discovered that the non-subsidized SHGs are better entities in terms of financial performance and sustainability in the state.

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