Mann Deshi Bank: An amazing success! "Chetna Sinha"
Wednesday, June 16, 2010
, Posted by Unknown at 5:34 AM
This is an extraordinary story of women's empowerment in rural India. Women in Satara district in Maharashtra run a bank and a B-school successfully.
Founded by Chetna Gala Sinha, the Mann Deshi Mahila Sahakari Bank was formed with the active participation of illiterate, rural women in 1997.
It was a struggle against all odds for Chetna Sinha who wanted rural women to be financially independent. The women needed to be removed from the shackles of poverty and money lenders in the drought-prone areas of Satara district in Maharashtra.
Money was the root cause of all their troubles. Finally, the relentless efforts of 500 rural women led to the mobilisation of a shareholder capital of Rs 600,000 to start their own financial institution.
"Founded in 1997, it is India's first rural financial institution to receive a cooperative license from the Reserve Bank of India. Today, Mann Deshi Bank based in Mhaswad, a village in Satara district, is the largest microfinance bank in Maharashtra with about 127,000 clients. Besides a business school to train women into success entrepreneurs, Mann Deshi Bank offers individual and group loans, savings, insurance and pension plans," says an optimistic Chetna Sinha.
Mobilising these poor, illiterate women, making them understand the need to start a bank that could be their economic lifeline was quite a daunting task.
"The biggest challenge was money. We needed deposits, people to fulfill conditions of the Reserve Bank of India. When we submitted the applications with thumb impressions of the members, our application got rejected. It was a tough battle, which lasted for two years. The women were then trained to read and write and given training in basic finance. It was very fulfilling to go back to the Reserve Bank with a group of women who had learned to calculate interest on any principal amount. The RBI officials were impressed," says Chetna.
With this, the bank crossed the biggest hurdle and got the license. The Mann Deshi Bank today prides to have assets of over Rs 40 crore (Rs 400 million) and a share capital of Rs 3.5 crore (Rs 35 million). Last year, the bank's net profit stood at Rs 20 lakh (Rs 2 million). "The bank has helped more than 62,000 women to build assets, own property and start small businesses," she says.
Besides this, the Mann Deshi Foundation runs a B-school which trains women to become successful entrepreneurs.
In 2002, Yale University appointed Chetna Sinha as a World Fellow, and in 2003 Harvard University recognised her as a 'Bridge Builder'. Chetna has received several additional awards for her pioneering work with women in drought affected areas of Western Maharashtra and Karnataka.
Mhaswad, a prosperous village with cotton fields was hit by a severe drought in the late 1970s, leaving farmers to work as daily wage earners. Many migrated to the cities in search of employment. So the entire household burden fell on women, who struggled to make ends meet.
Chetna, who began working since 1980 wanted to make a difference to the lives of hundreds of women.
Initially, she tried to understand the problems of the locals. She helped the people get maximum benefit from the schemes offered by the government during the drought. She soon realised that subsidies were not the answer, it was necessary to improve the economic conditions of the local women.
Chetna launched the Manna Vikas Samajik Sanstha (Mann Social Development Organisation) through which she started a credit cooperative society in 1992.
This society had small saving schemes suitable for the women of marginalised classes.The women pooled their weekly savings of Rs 5-10 and gave it to one group member at a time to buy goats or whatever she wished. A recovery rate of 100 per cent was maintained.
In order to deal with their problems, the collective strength of the women at the grass roots needed to be tapped, Chetna realised. The only solution for their problems was a women's bank. It was not an easy job. But Chetna along with the local women succeeded in their mission.
Besides changing women labourers to entrepreneurs, Chetna's work has impacted the education, financial knowledge and socio-political conditions in the villages and made the women aware of their rights.
Getting the license and mobilising people were the biggest challenges. "It took months to get women, train them and win their trust. Many were indebted to money lenders as co-operative banks did not encourage such poor people. With agriculture yield falling drastically, there was little means for sustenance. We realised that we needed to help them save money and offer financial guidance after we grant them loans," says Chetna Sinha.
With a strong team of 600 local women, she did what was considered the most impossible task. Today, the bank has field officers with wireless devices with the entire data of the clients. The bank's officers meet them on the field, at their homes or in the market to collect their savings or offer loans. The officer is instructed to be humane and show concern for the poor.
The daily savings could be anything from Rs 2-10 depending on what business they ran. "The default rate is just 2.5 per cent. The women are given anything between Rs 5,000 to Rs 25,000 without any collateral. They can opt to pay back within 12-32 months," she says.
The bank is the first in the region to initiate life, accident and hospitalisation insurance for women. Mann Deshi Bank now covers 7 districts in Maharashtra - Satara, Solapur, Sangli, Raigarh, Ratnagiri, Pune and Kolhapur. The Bank has six branches in Mhaswad, Vaduj, Gondavale, Dahiwadi, Satara, and Lonand.
Mann Deshi's success has now been replicated in two districts in Karnataka. More than 95 per cent of employees are local women from the region. The CEO of the bank, Rekha Kulkarni, had joined the bank as a clerk in 2000.
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