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Being part of self-help group has become more of burden than help for Rural Women in India

Until June 2016, Rs 9,000 crore in loans disbursed under the National Rural Livelihood Mission had turned NPA since 2013-14, according to government data

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Rural Population in India. Image source: Wikimedia Commons

August 20, 2016: Nirmala Devaki borrowed Rs 50,000 for a cousin’s wedding from her self-help group (SHG) about 2 years ago. SHG is one of the 3.9 million across India that offers loans as small as Rs 10,000, including for marriages.

To Devaki, a landless farmer from Dastikoppa village in Karnataka’s northwestern Dharwad district and one of approximately 40 million SHG members nationwide, the monthly interest rate of 2 per cent charged by her SHG, Gayatri Sevasahaya, seemed easy to handle.

Today, Devaki owes the SHG nearly Rs 1 lakh, a sum the widow with five children says she, like 8 million women, cannot pay back. Her family survives on Rs 5,000, which it earns from selling the milk of its one cow. “Being part of a self-help group has become more of a burden than a help,” she complained.

Across India’s villages, over the last three years, Rs 9,000 crore given by banks to SHGs, under the National Rural Livelihood Mission (NRLM), a government programme set up five years ago to boost rural incomes, have turned into non-performing assets (NPA), or loans in danger of being written off, much like the bad-loan crisis unsettling India’s commercial banking system, with more than 5,000 wilful defaulters owing banks Rs 56,621 crore, as IndiaSpend reported in March 2016.

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At 12 per cent of the Rs 77,650 crore the NRLM has lent over the last three years, the NPA figure may appear low. The corresponding NPAs in the commercial banking system for corporate sector are 5.5 per cent up to March 2015, according to Reserve Bank of India data.

The scale of the NPAs in the SHGs pale in comparison to corporate NPAs: Rs 9,000 crore owed by 8 million women is less than the Rs 9,478 crore default of one commercial defaulter, Lloyds Steel, second on the corporate NPA list.

The defaults of the women from SHGs are warning signs of similar stress and indicate that the Mission’s goal of organising up to 90 million rural households into SHGs over the next decade may have overambitious targets, inadequate safeguards and could jeopardise the very livelihoods it hopes to improve.

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There are two rules to lend money, said micro-finance expert M.S. Sriram, an economics professor at the Indian Institute of Management, Bangalore: One, assess the creditworthiness of a consumer, as banks do; two, penalise defaulters, which means customers can assess their repayment ability.

NRLM. Image source: Wikimedia Commons
NRLM. Image source: Wikimedia Commons

Those rules were ignored by banks lending to India’s largest companies, and they are being ignored now, as the NPA crisis similarly grows in rural India.

There are two reasons for the unfolding rural debt crisis involving women. One, SHGs are not educating and training rural women on the basics of smart borrowing, how to invest and spend wisely. Money borrowed for income-generating activities such as stitching, candle making or farming, is often spent on personal expenses, from weddings to home construction. Two, banks are aggressively pushing loans through SHGs to meet the government’s loan targets, without similar efforts at checking where this money goes.

You can hear stories like Nirmala’s in rural north India too. Mamta Kanwar, of Niwaru village in Jaipur, borrowed Rs 50,000 from her SHG, Om. She then distributed it to the group’s members so they could invest in stitching units. But they spent the money for personal purposes. Today, three years later, the Rs 50,000 has become an NPA.

Until June 2016, Rs 9,000 crore in loans disbursed under the National Rural Livelihood Mission had turned NPA since 2013-14, according to government data.

Stories from rural India reveal why loans are turning bad: Bankers appear to be scrambling to meet government-set loan targets, sacrificing due diligence.

Consider the example of Kalghatgi. The town has 1,907 Stree Shakti (Woman Power) SHGs with more than 25,000 registered members, which is more than the town population of 17,000, according to the 2011 census. This is because each of these members is registered with more than one SHG.

“The NRLM is not a government subsidy scheme,” said B. Lokesh, senior mission executive (Financial Inclusion), NRLM. “It is basically helping banks increase business. SHGs are a priority sector under RBI (Reserve Bank of India) guidelines, which means banks have to lend a certain percent of their total credit to SHGs.”

Banks are given targets, starting with an initial loan of Rs 50,000. If this amount is repaid, banks have to finance that SHG with an amount of up to Rs 1 lakh, which can later be raised to Rs 3 lakh. The branch manager decides the final loan, based on an SHG’s records, book-keeping, and repayment. So far, each SHG has received, on average, Rs 2.5 lakh.

SHGs are judged on the basis of regular meetings, regular internal lending, and bank linkage. There are no clear instructions or conditions to loan money. “Banks do not enquire about the purpose of the loan from the self-help groups,” said Vasanth Gowda, a field worker from Ujjivan Mini bank in Dharward.

“Members show handmade items to the government official for loans,” said Gaourava Ningappa, a member of an SHG in Tabakadahonnalli village, Kalghatgi. “But once the loan is sanctioned, and the money is withdrawn, they will stop whatever business they took the loan for and use the money for personal expenses.” (IANS)

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Dalai Lama says that India and China have great potential

The spiritual leader feels that both the countries are doing compassionate works

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Dalai Lama talks about India and China
Tibetan spiritual leader Dalai says that India and China can work together. VOA

New Delhi, Nov 19

Tibetan spiritual leader the Dalai Lama on Sunday said India and China have “great potential” and they could work together at a “practical level”.

“I think, a great potential… India and China combined are doing more compassionate work… At a practical level also. Imagine two billion people working together,” he told reporters here after inaugurating Smile Foundation’s initiative, The World of Children.

The spiritual leader, who has lived in India in self-imposed exile since 1959, said neither country had the “ability to destroy the other”.

“Whether you like it or not, you have to live side by side,” he said.

Underlining the ancient spiritual connection between the two countries, he said Chinese Buddhist Hsuan Tsang visited Nalanda (now in Bihar) and brought Nalanda Buddhist traditions to China.

“All thinkers of Nalanda are Indian. So Nalanda’s tradition is India’s tradition,” he said.

The Nalanda traditions had turned Tibetans, who were warriors, into more compassionate, peaceful and non-violent nation, he said.

“So sometimes in Delhi, teasing my Indian friend, (I say) if Tibet still remained in the previous way of life, like Mongols, Chinese invasion may not have taken place,” the Dalai Lama said in a lighter vein.

He said nobody in the world wanted violence but it was happening “because our minds are dominated by destructive emotions due to short-sightedness”.

“Nobody wants problems. Yet, many problems are our own creation.”

The Dalai Lama said the existing modern education was oriented to material values. India can take lead in improving the education system by combining modern education with ancient knowledge, he said. (IANS)

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Manushi Chhillar from India Wins the Miss World 2017 Title

India's Manushi Chillar won the coveted Miss World 2017 pageant here, 16 years after Priyanka Chopra won the title in 2000.

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Miss World
Manushi Chhillar has been crowned as Miss World 2017. Instagram #ManushiChhillar

China, November 19: India’s Manushi Chhillar won the coveted Miss World 2017 pageant, 16 years after Priyanka Chopra won the title in 2000.

Chhillar competed against 108 contestants from various countries at a glittering event held at Sanya City Arena here.

Miss World 2016 winner Puerto Rico’s Stephanie Del Valle gave away the coveted crown to the winner.

Chhillar, who is from Haryana, had earlier this year won the Femina Miss India 2017.

Miss world
Anti Ageing was the official skin care expert for Manushi Chhillar at the Miss World 2017 pageant. Instagram #ManushiChhillar

India, England, France, Kenya and Mexico grabbed the top five spots at the peagant.

Manushi, born to doctor parents, studied in St. Thomas School in New Delhi and Bhagat Phool Singh Government Medical College for Women in Sonepat.

Her entire family including brother and sister were present and they looked excited watching Manushi grabbing top five spot.

As many as 108 beauty queens from different parts of the world participated in the prestigious pageant. (IANS)

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Important Tips to Follow if you wish to Expand Business Overseas

Want to spread your business overseas? Here is all you need to do for Spreading your business internationally.

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Tips to expand business overseas
Tips to expand business overseas. Flickr

One of the first things people notice when they branch out into doing business internationally is how big a role social norms play in business dealings. It’s the same in North America, but the contrast is much more jarring when dealing with a new country, new etiquette, and new expectations. Whether you are applying for financing from a lender or opening a new branch of your business overseas, it’s important to understand that how you conduct yourself can have a profound impact on the success (or failure) of your business. Here are a few general guidelines to help you conduct business in a variety of regions around the world.

In Asian boardrooms, meeting participants will typically be arranged by seniority. This is also the order in which they should be greeted, and the order in which you should pass out your business cards. This is a sign of respect. Speaking of business cards, be prepared to hand out many more in Asia than you would in North America. There is a ceremony around exchanging business cards in countries such as Japan. Be sure to invest in a business card case, as it is seen as rude and inappropriate to keep them in your wallet or pocket.

In some Middle Eastern countries, note that it is quite normal for a male client or colleague to grasp another man’s hand while walking together. Although this may seem unusual to North American sensibilities, it’s considered a sign of trust in some parts of the world.

It’s also a good idea to bear in mind that questions that may be perceived in North America as being simple small talk may actually consider quite rude and intrusive in some countries, such as questions about marital status, children, age, etc. In professional situations, it’s always best to err on the side of being too impersonal rather than to risk being considered nosey.

Gift-giving in a business setting is complicated in some cultures. In some cases, for example, it is considered improper to open a gift in front of the giver, so be aware of that if you are presented with a gift.

Manners are a very big point of difference among different cultures. For example, it is perfectly acceptable and actually expected, that diners will eat a sandwich with a knife and fork. Similarly, belching and slurping one’s food is considered rude in some cultures, but quite acceptable in others. It is considered socially unacceptable in countries such as Japan to be seen blowing one’s nose in public.

When it comes to professional attire, you can never go wrong erring on the side of conservative, no matter where you are in the world. Women should take special care to dress more modestly, as it can be a serious culture misstep to dress too revealingly.

When you do business with other countries, it’s important to know the business and legal issues that may arise, but never forget that business is, as the heart of things, a people-first endeavor. The more you can be aware of and respectful of the social expectations, manners, and etiquette in the region in which you are doing business, the more professional you will be perceived. And that can go a long way toward helping you to solidify meaningful business connections around the world. If you aren’t sure how to act or what to do, always educate yourself before you arrive. Not only do you not want to look foolish, you also don’t want to be insulting. There are lots of resources online and in books to help you navigate these challenging waters.