The Role of Microfinance in Women's Empowerment: A Comparative Study of Rural & Urban Groups in India
The Role of Microfinance in Women's Empowerment: A Comparative Study of Rural & Urban Groups in India
Women’s Empowerment
A Comparative Study of Rural & Urban Groups
in India
While much has been written about the promise of
Microfinance as a tool for poverty alleviation and the
empowerment of women, Raji Ajwani’s book makes impor-
tant new contributions to the field. New insights into theo-
retical understanding and policy lessons are derived from
her extensive analysis of two models of Microfinance in
rural and urban India. Extending beyond a narrow focus
on income generation, the book presents new evidence on
the multiple dimensions of women’s well-being for those
who participate in Microfinance projects, their families, and
communities. I therefore commend this book to anyone
with an interest in gender and development issues, not only
in India but anywhere where Microfinance models need to
be better designed and implemented
Dr Andrew Bradly, Senior Lecturer &
Deputy Director (Education),
Research School of Management,
Australian National University
By
Raji Ajwani-Ramchandani
BAIF Development Research Foundation,
Pune, India
ISOQAR certified
Management System,
awarded to Emerald
for adherence to
Environmental
standard
ISO 14001:2004.
CHAPTER 1 Introduction 1
v
vi CONTENTS
Chapter 1
Figure 1.1 Empowerment: Select Components and
Relationships. . . . . . . . . . . . . . . . . 2
Chapter 2
Figure 2.1 Flowchart for the Review of Literature. . . . 17
Chapter 3
Figure 3.1 Theoretical Representation: Life Cycle of a
Poor Woman/Microfinance Beneficiary. . . . 29
Figure 3.2 Entitlement-Breakdown Position
Empowerment. . . . . . . . . . . . . . . . . 34
Figure 3.3 Stages: Moving towards the Goal of
Empowerment. . . . . . . . . . . . . . . . . 35
Figure 3.4 Theoretical Framework for Empowerment. . 39
Figure 3.5 Towards Empowerment Conceptualised by
the Author Based on Sen (1987). . . . . . . . 40
Figure 3.6 Positive Effect of CBMFIs in Improving the
Breakdown Position of Members. . . . . . . 42
Chapter 4
Figure 4.1 Elements of Financial Inclusion. . . . . . . . 51
Chapter 5
Figure 5.1 Evolution of Microfinance in India. . . . . . 70
Chapter 6
Figure 6.1 Keeping the Member Centre Stage . . . . . . 82
Figure 6.2 Sex Ratio in Maharashtra vis-á-vis India. . . 85
Figure 6.3 Mixed Methods: An Important Aid for Data
Triangulation. . . . . . . . . . . . . . . . . 91
vii
viii LIST OF FIGURES
Chapter 7
Figure 7.1 Annapurna Parivar: Organization Structure
and Institutions. . . . . . . . . . . . . . . . 105
Figure 7.2 Details of Day-Care Centres (Number of
Centres and Their Charges) . . . . . . . . . . 108
Figure 7.3 Number of Children Benefited by Day-Care
Centres. . . . . . . . . . . . . . . . . . . . 108
Figure 7.4 The SHG Federation Model. . . . . . . . . . 116
Chapter 8
Figure 8.1 Process Followed during the Study. . . . . . 126
Figure 8.2 Changes in Income and Saving. . . . . . . . 152
Figure 8.3 Increase in Saving after SHG. . . . . . . . . 152
Figure 8.4 Changes in Saving Pattern after SHG. . . . . 153
Figure 8.5 Changes in the Ability to Contribute after
SHG. . . . . . . . . . . . . . . . . . . . . . 155
Figure 8.6 Member’s Ability to Access/Service Credit
(in Her Own Name) . . . . . . . . . . . . . 156
Figure 8.7 Ability to Repay Household Loans with Own
Funds. . . . . . . . . . . . . . . . . . . . . 157
Figure 8.8 Participation in Deciding the Usage of Funds. 157
Figure 8.9 Changes in the Appreciation Received:
Family/Friends . . . . . . . . . . . . . . . . 158
Figure 8.10 Changes in the Members’ Ability to Venture
Out . . . . . . . . . . . . . . . . . . . . . 159
Figure 8.11 Changes in the Ability to Speak Up and
Express Views/Opinions . . . . . . . . . . . 160
Figure 8.12 Changes in the Ability to Face Medical
Emergencies. . . . . . . . . . . . . . . . . . 162
Figure 8.13 Members Having Bank Accounts (%). . . . . 163
Figure 8.14 Changes in the Ability to Undertake Banking
Transactions Independently. . . . . . . . . . 163
List of Figures ix
Chapter 9
Figure 9.1 Annapurna Pariwar: A Group of Five
Organisations. . . . . . . . . . . . . . . . . 174
Figure 9.2 Changes in Awareness about Various
Development Programmes.. . . . . . . . . . 199
Figure 9.3 Changes in the Personal Grooming Pattern. . 200
Figure 9.4 Changes in the Independent Mobility. . . . . 201
Figure 9.5 Changes in Appreciation Level. . . . . . . . 201
Figure 9.6 Changes in Saving Pattern of the JLG
Members. . . . . . . . . . . . . . . . . . . 202
Figure 9.7 Ability of the Members to Borrow in Own
Name. . . . . . . . . . . . . . . . . . . . . 204
Figure 9.8 Change in the Ability to Repay the Loans. . . 205
Figure 9.9 Ability to Participate in Deciding the Usage of
Funds at the Household Level. . . . . . . . . 206
Figure 9.10 Changes in the Ability to Undertake Banking
Transactions Independently. . . . . . . . . . 207
Figure 9.11 Change in the Confidence Level to Face
Medical Emergencies. . . . . . . . . . . . . 208
Chapter 10
Figure 10.1 Before Demonetization. . . . . . . . . . . . 214
Figure 10.2 After Demonetization. . . . . . . . . . . . . 215
Chapter 11
Figure 11.1 SKS Microfinance’s Choppy IPO Graph. . . . 237
Figure 11.2 Attaining and Sustaining the ‘Power Within’. 242
Figure 11.3 Prevailing Banking System: Transaction
Flows. . . . . . . . . . . . . . . . . . . . . 263
Figure 11.4 Block Chain: Transaction Flow. . . . . . . . 264
List of Tables
Chapter 1
Table 1.1 Characteristics of Effective Gender
Development Policies. . . . . . . . . . . . . . 9
Chapter 5
Table 5.1 Progress of Microfinance in India. . . . . . . . 71
Table 5.2 Overall Progress of the SHG-BLP in India. . . . 72
Table 5.3 Region-wise Share in Average Loan
Outstanding (2015 2016). . . . . . . . . . . 74
Table 5.4 Region-wise Trend of JLGs in India
(2012 2014). . . . . . . . . . . . . . . . . . 77
Chapter 6
Table 6.1 Details of the Selected Village as per
Government of India Census 2011. . . . . . . 89
Table 6.2 Details of Branches of Annapurna Parivar in
Mumbai and Pune.. . . . . . . . . . . . . . . 90
Table 6.3 Details of Selected Villages and Sample
Households. . . . . . . . . . . . . . . . . . . 93
Chapter 7
Table 7.1 Annapurna Mahila Co-operative Credit
Society Ltd. . . . . . . . . . . . . . . . . . . 109
Chapter 8
Table 8.1 Details on GMSS Outreach (Data as on April
2015). . . . . . . . . . . . . . . . . . . . . . 128
Table 8.2 Details of the Loans and Advances Given by
GMSS to Sister SHG Federations (in Indian
Rupees: INR). . . . . . . . . . . . . . . . . . 128
Table 8.3 Education Levels of the Respondents and
Their Spouses. . . . . . . . . . . . . . . . . . 130
Table 8.4 Number of Children (Rural). . . . . . . . . . . 131
xi
xii LIST OF TABLES
Chapter 4
Box 4.1 Bank-Able or Not?. . . . . . . . . . . . . . . . 49
Box 4.2 Saving for a ‘Rainy Day’. . . . . . . . . . . . . 62
Chapter 7
Box 7.1 Together as a Team. . . . . . . . . . . . . . . . 111
Box 7.2 From Despair to Hope. . . . . . . . . . . . . . 112
Box 7.3 All that Glitters…is Gold. . . . . . . . . . . . . 113
Box 7.4 Borrowing for a Better Future: Investing in the
Girl Child’s Education.. . . . . . . . . . . . . . 114
Box 7.5 Mobilising the Power of Aggregation
for Change. . . . . . . . . . . . . . . . . . . . 118
Box 7.6 The Desire to Learn … . . . . . . . . . . . . . . 122
Chapter 8
Box 8.1 Illiterate or Innovative?. . . . . . . . . . . . . . 133
Box 8.2 When the Group Leader Misleads the Members.. 134
Box 8.3 An Opportunity Lost due to Lack of Market
Linkages.. . . . . . . . . . . . . . . . . . . . . 136
Box 8.4 Remaining within the Societal Norms. . . . . . . 139
Box 8.5 Wanted: Cottage Industry: Livelihood
Opportunities. . . . . . . . . . . . . . . . . . . 141
Box 8.6 Saving: Every Little Drop Counts. . . . . . . . . 154
Box 8.7 Tarabai Bombale: Managing the Homefront
While the Son Serves on the Warfront. . . . . . . 155
Box 8.8 A Unique ‘Pyramid’ Goatery Livelihood
Model: Story of Chandrakala Bombale. . . . . . 161
Box 8.9 Black Beauty: The Buffalo that Brought in the
Money!. . . . . . . . . . . . . . . . . . . . . . 164
xiii
xiv LIST OF BOXES
Chapter 9
Box 9.1 Poor or Not?. . . . . . . . . . . . . . . . . . . 176
Box 9.2 The Debt Trap. . . . . . . . . . . . . . . . . . 181
Box 9.3 Funding Dreams through Education: Sudha
Kamble’s Efforts to Educate Four Daughters. . . 183
Box 9.4 Empowered or Not? Staying in One-Sided
Relationships Keeping the Family Central. . . 185
Box 9.5 An Accident: Who Can Help It?. . . . . . . . . . 187
Box 9.6 Demanding Her Rightful Space. . . . . . . . . . 199
Box 9.7 Every Roti Counts… . . . . . . . . . . . . . . . 203
Box 9.8 When a Major Train Accident Derailed
Sangeeta’s Household. . . . . . . . . . . . . . . 208
Chapter 10
Box 10.1 Boomerang. . . . . . . . . . . . . . . . . . . . 218
Box 10.2 A House of Cards And How Demonetization
Came to the Rescue. . . . . . . . . . . . . . . . 219
Chapter 11
Box 11.1 Banking on … What?. . . . . . . . . . . . . . . 231
List of Maps
Chapter 6
Map 6.1 Location of the Study Area: Pune District,
Maharashtra, India. . . . . . . . . . . . . . . . . 89
Chapter 8
Map 8.1 Location of Selected Study Blocks in
Pune District. . . . . . . . . . . . . . . . . . . . 127
xv
List of Abbreviations
xvii
xviii LIST OF ABBREVIATIONS
and
B
eing poor can be challenging anywhere, particularly in a
developing country. In such a scenario, the support of
empathetic peer groups can be crucial in bolstering the
confidence and in helping to circumvent the binds of social dos
and don’ts with minimal friction and adverse repercussions.
Community-based women centric microfinance institutions
can play a very big role in enabling women realize their own
inner strengths by leveraging the power of aggregation.
However, in the immense ocean of microfinance literature and
the resulting discourse, such grassroots focused institutions are
often overlooked or are clubbed with the ‘rest’.
This book attempts to bring to the forefront the work of two
women centric grassroots organisations that have been working
for empowering women for over a quarter century. They have
transformed the social and cultural landscape in the areas where
they operate, by enabling their members get access to formal
sources of finance and credit, as well by providing them with the
necessary capacity building inputs.
These models have withstood the test of time and have devel-
oped a formidable membership base. Given the fast paced
changes that have been witnessed in the Indian banking sector
over the past couple of months after the demonetisation
announcement, these institutions are placed at an important junc-
ture where they will be required to reinvent certain aspects of
their processes and operations. However, their journey thus far is
fascinating and this book has tried to capture various facets of it
through the eyes of their members. The focus has been to bring
xxiii
xxiv PREFACE
1
The names of the respondents have been changed in order to protect
their identity and respect their privacy
Foreword
xxv
xxvi FOREWORD
Ram Mudambi
Frank M. Speakman Professor of Strategy
Temple University, Philadelphia, USA
Acknowledgements
T
his book is the culmination of over seven years of effort.
From idea to execution, it has been a cathartic process:
wherein I stumbled a lot, learnt a great deal and experi-
enced a world that is very different from the one that most of us
live in. The grit and the mental resilience of majority of the
women that I met made me realize and appreciate a lot of things
that I had assumed to be commonplace and had taken for
granted. A good meal, a safe home, a caring family and the free-
dom to speak up and articulate my thoughts are some examples
that come to mind. But no matter how good a story might be for
the author, someone needs to believe and give that first chance
and I’m very grateful to Dr Ram Mudambi for giving me that
opportunity. Ram is a mentor par excellence who inspires
through his work. Ram is one of the most versatile individuals
that I have come across: a great academic, best-selling fiction
writer, competitive biker, world traveler, devoted AIB office
bearer, caring family man and a great human being. Even if I can
become a fraction of what he is will be a miracle!
Dr Susan Mudambi for her encouragement. Susan’s calm
voice and bright smile can make a dull day seem fantastic.
Charlotte Maiorana and Fiona Mattison at Emerald Insight for
believing in my research and enabling the publication of my
maiden book. Dr Mark Casson for his time and advice given his
stature and seniority. Dr Sonali Bhattacharya and Dr Andrew
Bradly for their feedback which helped me to improve the manu-
script. Dr Shrikant Kalamkar and Dr Manju Singh for weather-
ing many a storm with me. Dr Shrikant is a great PhD supervisor
who has always given me the requisite support whenever I
needed it. He is an extremely down to earth and an optimistic
individual, who readily offers unconditional help.
Dr Manju Singh’s pragmatic approach helped me during
some trying moments. Mr S. Sivakumar for his rock solid sup-
port and encouragement. Sivakumar Sir is the voice of reason
that I turn to when in doubt. He is analytical, very creative and
xxvii
xxviii ACKNOWLEDGEMENTS
Raji Ajwani-Ramchandani
Pune, India
February 14, 2017