This study critically compares the effectiveness of the microfinance-based “Self-Help Group (SHG) model”, particularly those linked to Primary Agricultural Credit Societies (PACS), and “direct-benefit transfer government schemes” in fostering holistic women’s empowerment in East Medinipur, West Bengal. Using a mixed-methods approach involving a quantitative survey of “300 women” (150 from each intervention type) and qualitative interviews, the research measured empowerment across economic, socio-political, and psychological dimensions. Quantitative results demonstrated that “SHG members achieved significantly higher scores in socio-political and psychological empowerment” (p < 0.01), reporting greater involvement in household decisions, local governance participation, and enhanced self-confidence due to their “group-based, process-oriented approach” that builds social capital and collective agency. Conversely, government schemes provided a pronounced, albeit short-term, economic cushion through direct asset and cash transfers. The study concludes that while government schemes offer crucial “immediate welfare support”, the “SHG-PACS model provides a more robust pathway to holistic and sustainable empowerment”, recommending a synergistic model where schemes provide capital infusion and welfare security, and SHGs serve as the platform for implementation and social mobilization for optimal, long-term impact.