Our London team recently had a visit from Chetna Gala Sinha, Founder of the Mann Deshi Foundation. An economist, farmer and social activist who has dedicated her life to the economic empowerment of rural women in India, we’ve had the pleasure of partnering with her Foundation on our Driving Women’s Business Growth in India project.
The Mann Deshi Foundation runs a cooperative bank that provides women micro-entrepreneurs in the drought-prone region of Satara in Maharastra with the knowledge, skills and support they need to run successful enterprises. To coincide with Financial Inclusion Week 2017, we asked Chetna about the Mann Deshi Foundation’s work and current challenges and opportunities for women’s financial inclusion and entrepreneurship in India.
1. What difference does access to finance make to the women entrepreneurs Mann Deshi works with?
From the very beginning of Mann Deshi’s journey, our work has been guided by the women themselves. In 1996, a welder called Kerabai who lived on the streets with her family told me that banks were refusing to accept her savings. So we launched a bank because we realised that poor rural women needed a safe space to keep the money they had worked so hard to earn. We now provide a number of products and services to women based on their particular needs, including loans and pension products.
The primary objective for most of the women entrepreneurs we work with is wealth creation. Many of them are incredibly savvy and have a good understanding of basic arithmetic, even if they are poor and haven’t had much formal education.
So, where they would usually struggle to access formal loans to grow their enterprises (due to lack of collateral etc.), we are able to help. To ensure they feel well-equipped to grow their businesses and have access to markets, we have a business school and have set up three Chambers of Commerce.
Fundamentally, financial autonomy gives women so much more confidence and power within their households and communities. A woman once told me: “My courage is my capital.”
With access to funding to grow their businesses, these women also go on to create jobs. The effects of investing in women quickly multiply. For example, last year a total of 12,000 new jobs were created by the women entrepreneurs we support.
2. Tell us a bit about the Mann Deshi MBA, the project we partnered with Mann Deshi to develop
Our business school has been running since 2006, and every woman who takes a loan from the Mann Deshi Bank must partake in the financial literacy classes. Initially we provided just financial literacy courses but over the years we also added other vocational components, such as marketing.
Despite expanding the range of classes we offered, we noticed there was a gap for more established women entrepreneurs. So, in 2014 we developed the MBA with the Cherie Blair Foundation for Women to deliver more specialised vocational training. It’s an intensive one-year course and mentorship programme to help seasoned women entrepreneurs expand their businesses.
The most important aspect of the MBA programme is that we are bringing knowledge, technology and support to women’s doorsteps. The training is delivered in their villages, so they don’t need to spend excessive time away from their businesses and family commitments.
3. How do you engage resistant relatives in Mann Deshi’s work with women?
When it comes to men, we not only engage them but also celebrate their support. Early on in our work, some of the women told us that, while their own financial literacy had improved, it was of little use if their husband’s approach to money was the same as before. So we began offering financial literacy classes to men too. Both men and women attend our financial literacy classes to this day.
We also celebrate the support of husbands during our graduation ceremonies. These are huge community events which can attract up to 5,000 guests. As well as presenting certificates and awards to women participants, we also present awards to men who have been particularly supportive of their wives’ ambitions.
These huge events, as well as announcements on our Mann Deshi community radio station celebrating the women’s successes, help to boost their standing in the communities. Where women’s families were initially resistant, many eventually end up feeling a sense of pride in their achievements.
4. What do you think are some of the biggest gaps in financial inclusion for entrepreneurs in India?
In our experience of providing small loans to women entrepreneurs over the years, we have noticed a gap in formal financing for women entrepreneurs who have gone beyond the microcredit stage. Many of these women might still be rejected from formal bank loans, but their businesses have grown too large for microcredit alone.
The Indian Government recently introduced Pradhan Mantri Mudra Yojana – loans for micro and small enterprises – but according to our own research and experience, not many of the women entrepreneurs we’ve worked with seem to have accessed this funding. There are other similar initiatives on the horizon, so we will wait to see whether they come to fruition and help to fill this particular gap for women entrepreneurs.
5. How do you integrate technology into your work with rural women?
Technology offers so many potential benefits to women entrepreneurs, including those at the bottom of the pyramid. However, we need to ensure that women a) have access to it and b) feel confident using it.
We recently launched a digital literacy bus and we drive it to weekly markets. Women are so excited to learn how to use ATM cards, laptops, tablets and smart phones.
Technology has always been an important area of our work. For example, we pioneered doorstep banking for women customers using biometric smart cards long before ATMs became a common sight in rural areas.
6. In your opinion, has India’s 2016 banknote demonetisation led to improved financial inclusion for women in India?
One thing I would say is that it’s opened the door for improved digital financial inclusion, but the banking system needs to promote and motivate people to use the services – as well as making them cheaper and more accessible. This is particularly important for women; if the banking sector more actively targeted and tailored products to women, they would use them in greater numbers.
7. What do you think are the most impactful policy interventions that can be made to support women’s economic empowerment at the global level?
Firstly, more investment. Gender inequality is often spoken about, but how what proportion of philanthropic spending actually goes towards actively alleviating it? This applies to all areas affecting women and girls. Many countries are taking steps to change policy and legislation which is positive, but aren’t necessarily investing in these areas. We keep talking about the need for more gender equality, which is great. But talk alone doesn’t lead to impact.
Secondly, if you look at Latin America, Africa and Asia, women have shown time and time again that they are reliable borrowers. They have provided returns to investors and can be relied on to repay even when they’ve borrowed at high rates of interest. We have proved that we are bankable and there is business in us – so why, aside from microcredit, has the financial sector not come forward to provide tailored banking products suited to the needs of women entrepreneurs? The financial industry needs to prioritise developing banking products and services that take into account the economic and social realities women face.