At 3:20am, as I sway in the train taking me back to my home, I was relieved for how fulfilling the day was to see Indian women entrepreneurs taking charge of the situation in this part of India called Parbhani.
The purpose of my visit to Savitribai Phule Mutual Benefit Trust (SPMBT), Parbhani was:
- Pay a random visit and follow the day to day activities of SPMBT
- Interview beneficiaries, Self Help Group’s (SHG) secretary and cluster level representatives with discussion focussed towards micro finance and difference it has made on their lives
- Interview SPMBT staff (Field Executives, Management etc) to understand their role and level of participation in empowering women
- Bring transparency on fund usage when we disburse the first 30DF payment to SPMBT
As expected, my flight to Aurangabad airport was late by an hour, which further got delayed by another hour because of heavy air traffic at Mumbai airport. Fortunately, I had booked a taxi to take me to Parbhani that is almost 4 hours drive from Aurangabad. I am stating this because this caused me to change my initial agenda since I had lesser time at hand. To accommodate and make use of my time, I called SPMBT and arranged a group meeting with beneficiaries and the staff.
I grew up in a small place and women there are innately shy, or rather they are never taught to talk. Almost 70% of India must be following this culture of ‘being shy’. This place is no different, so I was amused when I communicated with beneficiaries. Whoa – these females can talk!! Could this be a by-product of micro finance activities in this area? I asked – and was told unequivocally by all 13 beneficiaries that it is a direct impact of initial 6 months of training they received from SPMBT staff as a part of forming a SHG and regularly held meetings after that at Village and District levels. Well, to add to that everyday operation of SHG like accounting, payments, disbursement etc and regular human contact must have ignited and sustained this entrepreneurial flame in these village women. I am impressed!
To understand and evaluate the direct impact of micro finance, I started asking them questions as I mention below. I received many responses, some direct answers to my questions, some digressed but important information. Following is the summary:
- How different it is to take loans from SPMBT as compared to taking loans from local moneylenders (Sahukars)
[Beneficiaries] You tell me, if 100-120% rate of interest is better or 22%? On top of an unaffordable loan terms, Sahukar uses very harsh recovery mechanisms (e.g. Barging in to house and taking valuables away).
- Why is the repayment rate high? Are there any caveats?
[Beneficiaries] There is a group ownership of the loan. If some member misses the repayment for any month, group informally meets, discusses and pays on behalf of the defaulter. Most of the times, group’s internal savings take care of such situation. Also, group members do not want to loose the only source of constant credit. It neever happened to them before that they get the loans when they need it – it is ‘readily’ available.
- What happens to the defaulters? Do SPMBT take any harsh action for recovery?
[SPMBT staff] Defaulters are rare. But there is a provision of penality in case of missed payment, which comprises of accumulation of daily interest at a predefined but reasonable rate.
- How does SPMBT help in the process?
[SPMBT staff, Beneficiairies] When a group of women decides to form a SHG, they undergo training for a period of 6 months monitored and taught by SPMBT’s staff. They learn SHG concept, involved accounting and appraisal process as a part of this training. SPMBT monitors the change and group’s understanding of the process, and once assured they mark the SHG as a capable one and ready to receive loans.
- Does SPMBT follow any methodology before sanctioning loans to the SHG?
[SPMBT staff, Beneficiairies] There are set of questions that the group needs to answer. Points are associated with answer choices of each question. Maximum points are 700 and groupd need to score at least 350 to be eligible for any kind of loan. One sample question: “What is the attendance percentage for monthly meetings for past 6 months?”
Before I continue to next questions, it is important to understand the hierarchy of operations:
SPMBT Operartions
- How do you monitor if the loan is being used for the purpose it is taken for?
[SPMBT staff] The monitoring happens at each level of the hierarchy starting from individuals, then SHG, village and district level. Field executives of SPMBT takes part in the monthly meeting of SHG to ensures that loans are being used for the purpose it is taken for.
- How would we (30DF) know if the money that is sent here is being used properly by SPMBT?
[SPMBT staff] Partly, answer from the last question is applicable here. Also, all families have cell phone/s. We can provide you with beneficiary contact information that 30DF can post either on the website or inform social investors through email. Investors can call to these numbers to directly speak with end beneficiaries. Also, we are open to any number of random audits by 30DF team.
This followed by an informal round of personal discussion and most responses aligned with what they have already told me in the group meetings. Unfortuately, because of lack of time, I could not go to the field and see them working. To conclude, it is definitely not so much about a loan as about empowering and producing women who can lead and help to bring a social change. Change that involves a woman to barg into a grampanchayat meeting and speak on the issues faced by the village!!
