Up t 87% of the poorest households in India do not have access to credit; 380 million are in need of microfinance services. Unequal education opportunities and access to business prospects has resulted in stunted economic security, particularly amongst women in coastal communities. This is where Small Grant Facility projects in India, under the Mangrove for the Future initiative (implemented by IUCN), are making a difference.
In Karankadu, a coastal village in the Ramanathapuram District of Tamil Nadu, India, a large percentage of the families owe relatively large debts to the village loan-shark. Moreover, facing a fresh water crisis and being too remotely located for piped water, families are forced to buy tanker water for their daily needs. The community is caught in a vicious cycle of helpless desperation.
While they have been much in demand wherever they have been introduced (they provide a cheaper alternative to the village loan shark) microcredit firms are sceptical of administering loans to borrowers in remote areas. The project overcame this through the institution of 8 Joint-Liability Groups with 5 women members in each, thereby distributing the responsibility of repayment. Canara Bank has agreed to provide loans up to INR 15,000 (approxIately USD 241) for each woman (at a lowered interest rate) to implement livelihood options including crab fattening, sea bass culture and fish pickles. Local partners including Society for People Education and Economic Development (SPEED), M. S. Swaminathan Research Foundation, and Central Marine Fisheries Research Institute, are providing exposure visits, capacity building and skills trainings to the women. Market linkages have already been identified for these products, and the project partners are ensuring that the women can easily leverage them.
Through the JLGs and microloans, fisherwomen in Karankadu village are learning new livelihood skills creating economic development and sustainability, and financial independence for the first time in their lives. The interventions have promoted social cohesion amongst the women, further establishing a network of support for their families. This is a bellwether for similar models in the rest of Ramnathapuram District. SPEED and IUCN are exploring opportunities to replicate activities in surrounding villages; the National Bank for Agriculture and Rural Development has already expressed support to continue similar interventions.
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