Money is the seed of money, and the first guinea is sometimes more difficult to acquire than the second million. —Jean-Jacques Rousseau
The 21st century poses many challenges that require new ways of thinking, none more important than the economic role of women in a rapidly changing world. Over the last several decades, it has become accepted wisdom that improving the status of women is one of the most critical levers for addressing poverty. A series of studies has found that when women hold assets or gain incomes, family money is more likely to be spent on nutrition, medicine and housing, and consequently children are healthier. In 2015, world leaders put gender equality and the empowerment of girls and women squarely at the top of international and development agendas. The 17 Sustainable Development Goals (SDGs) agreed upon by world leaders raised global ambition levels and added fuel to the momentum that has been building over the last decade to achieve major improvements for people and planet, and not least the world’s women. This is seen not only as important in its own right, but also as an essential ingredient for eradicating poverty
Over the years several strategies have been used to empower women .One of them relies on community groups whose members can be trained and equipped to use their collective strength and wisdom to tackle their problems.
In India, community groups have been set up in villages and slums to tackle specific problems. They are known as self-help groups. It needs great emotional intensity to break through age old barriers .This can possible only through groups who share the same emotional values and are driven by strong impulses of mutual goals. One of the primary objectives is of course to avail loans which the women access by cross guaranteeing each other’s liability. These loans are part of a financial philosophy called microfinance. Members take loans for a variety of reasons: to buy medicine, start a business, purchase animals, pay school fees, buy clothing, buy food during the lean season, invest in agriculture .When we place capital in the hands of women, especially low-income women, who don’t have access to loans through traditional means it works wonders – unlocking her entrepreneurial impulses. When women are reached, they gain the courage and skills to break the cycle of inter-generational poverty. We create the most powerful catalyst for lasting social change
None had made better use of the cash than Renuka Mahalle, a shrewd, flinty young mother who put her profits from four loans into cows, goats, land, a sturdy house and private tutors for her daughter. “I can make money out of anything,” she boasted, a flower-shaped gold stud glinting in her nose. Her house was made of mud, dirt, and cow dung with a thatched roof. In the yard, bricks were stacked up and small fire pits held twigs for cooking sorghum flatbread. A brown cow lay contentedly in the shade. When the dynamic Renuka got her first loan, for Rs. 5000, she already had Rs.2000 saved from working as a cook and raising chickens, the family trade. She invested her savings in a cow she later sold for Rs. 10,000. Her next Rs. 10,000 she invested in a thresher machine. It takes care of her own farming requirements, and when it is not in use at her farm, she rents it out. The villagers are also happy that they don’t have to hire one from an outsider. .
In my microfinance journey of almost two decades, I was part of an oganisation which has served thousands of women giving them access to financial services and women proved to be responsible and dynamic in their approach. They began earning, planning and investing back into their families. I remember there was a woman who started out with a mud hut. When I came back after three years on a personal holiday, she had a three-room house with a cement floor, and the goats were stabled in the hut in which she had stayed before. When her group of women first came for loans, they sat hunched, looking down into their laps. They would take the small pile of pastel and white notes they got as part of a loan and fold it into a hairpin behind their ears. They were looking so frightened because, they said, they were afraid they couldn’t pay it back. Some of them suggested taking only a part of the loan. For the remaining they said they would consult their husbands and then come back. Now, these same women were running businesses, and were often involved in politics in their village.
One must however understand how lenders operate and what are implications of debt for a woman who is borrowing that money Lenders may extend loans without understanding whether the economy of a particular area can sustain the businesses. Micro-entrepreneurs may be undone by an unexpected illness, a poor investment decision or a theft. A defaulting woman therefore faces the ire of other borrowers who see her as breaking faith with them, and, instead of developing social solidarity, the loans heighten social tension.
Several development successes have occurred in less than optimal settings, often under appalling conditions: weak governance, widespread corruption, minimal infrastructure, deep-rooted social divisions and a calcified bureaucracy. In each case, creative individuals saw possibilities where others saw only hopelessness, and imagined a way forward that took into account local realities and built on local strengths.
For decades, policy makers have treated poverty as a sign of helplessness and ineptitude. To improve poor villages or slums, the people who live there must have a hand in deciding their own fate.
We need to bring in the poor to the conversation. Interventions that take the end user into account almost always have better success rates than top-down decision-making. But many social programmes are still not talking enough to their poor customers to find out what they really want, and too often policy makers have no idea what their end beneficiaries really need. Community development isn’t a quick fix. It’s hard work and it takes time. But what’s happening in villages I worked and elsewhere shows that it’s worth doing.
Moin Qazi is the author of the bestselling book, Village Diary of a Heretic Banker .He has worked in the development finance sector for almost four decade .He can be reached at [email protected]