In a country of over 121 crore people, where 83.3 crore live in rural areas and the rest stay in urban areas, only about 22% of the population is considered to be below the poverty line. The continuing urbanisation has indeed contributed to creating more opportunities for the people. On the other hand, some sectors like agriculture have also suffered. However, the question remains the same – how do we make India more self-sustainable?
During my recent experiences, while working with Chaitanya in tribal/rural areas of Madhya Pradesh and Maharashtra, I was able to dig deep into relevant statistics, government schemes and their impacts. Our special focus is on educating women and promoting savings as a habit. One such scheme is on micro-finance, which has been debated enough by economists and banks. However, it has indeed shown strong positives.
Muhammad Yunus, the winner of the 2006 Nobel Peace Prize and author of “Banker to the Poor: Micro-lending and the Battle Against World Poverty”, said:
“When a destitute mother starts earning an income, her dreams of success invariably center around her children. A woman’s second priority is the household. She wants to buy utensils, build a stronger roof, or find a bed for herself and her family. A man has an entirely different set of priorities. When a destitute father earns extra income, he focuses more attention on himself. Thus money entering a household through a woman brings more benefits to the family as a whole.”
A self-help group (SHG) is a voluntary association of men or women in similar economic conditions. The members of the group make small savings for a duration of time until they have enough capital in the group to start their own lending process. These funds can then be utilised for lending purposes (to members or other people). In India, many SHGs are linked to banking institutions for the delivery of micro-credit.
Self-help groups are popular and famous in India and South-East Asian countries. In Bangladesh, Muhammad Yunus developed this concept (along with those of micro-credit and micro-finance) for the poorest of the poor, who were ignored and shunned by banks when it came to lending tiny sums of money.
1. 1987: The National Bank for Agriculture And Rural Development (NABARD) provided MYRADA with a grant of ₹1 million to enable it to invest resources in identifying affinity groups, building their capacities and matching their savings after a period of 3-6 months.
2. 1990: RBI accepted the SHG strategy as an alternative credit model.
3. 1992: NABARD issued guidelines to provide the framework for a strategy that would allow banks to lend directly to SHGs.
4. 1992: SHG-Bank Linkage Programme was launched.
5. The Tamil Nadu Women’s Empowerment Project, an IFAD-supported project implemented through the Tamil Nadu Women’s Development Corporation, was the first project in the country, around 1990, to incorporate the SHG concept into a state-sponsored programme. Since then, SHGs have been associated with women.
Let’s look at the poverty circle. Women have always been given a secondary status – be it at home or in society. Women still remain poorest of the poor and can never break free from this cycle. Above all, a poor woman is vulnerable, insecure and lacks knowledge.
They lack four basic things:
Self-help groups fulfil the four criteria cited – thereby making them financially stable and also granting them a sense of empowerment.
Here, I would like to share another excerpt from Dr Yunus’ book:
“Women experience hunger and poverty in much more intense ways than men. If one of the family members have to starve it is an unwritten law that has to be the mother.
A poor woman in our society is totally insecure – insecure at her husband’s house… She is insecure in her in-laws’ house for the same reason she was in her parents’ house…”
She has nothing to call her own. She cannot read and write and it is possible that she has never been allowed out of her house to earn money, even when she wanted to. So, when she is given even the smallest opportunity, she struggles extra hard to get out of poverty to build up her financial security.
Let me share a real-life story with you.
She worked as a sweeper and used to clean the area around a bank. She saved a very small amount of money (₹10) in the same branch every day for 11 years. Her persistent approach ensured that she had savings for the bad days. Today, she has her own house in Pune, with savings worth ₹11 lakh.
This is the story of Anuradha Tai. More importantly, we also want a million other empowered women in rural India to have such a story.
A version of this post first appeared here.