The Women-Only Banking Collective That Is Changing India

A new initiative by women for women in Varanasi, India, is shattering outdated power structures. It is a bank that was created by small cooperatives of women within the city. It helps women save, and take out emergency loans, without being at the mercy of predatory lending.

Called the Jagriti Swayam Sahayata Samooh Bank it started small, with women gathering food staples like potatoes, and depositing them in an ‘account.’ Over time, those staples were turned into real money and the women began creating a substantial savings.

These days, over 2,000 women have joined this bank. Once they join they are organized into smaller collectives and asked to contribute a small sum every month. If an emergency takes place, the women can take out an emergency loan from the bank. Women are also given personal loans to help jump-start their business or invest in development and educational projects.

Unlike many money loaning schemes in India, which tend to enact exorbitant lending rates, and often take advantage of the lack of financial education in women, this bank only charges about 2 percent interest on loans. That interest is then distributed equally to the women within the cooperative, ensuring a return for everyone.

One woman who used the bank told reporter Saiyed Faiz Hasnain:

“After the death of my husband, I was unable to find a means of livelihood. The man from whom we had taken money was regularly coming home to get his money back. However, the Jagriti Swayam Sahayata Samooh Bank came to my rescue and provided me with loan at the time of need. Now I am running a small business to support my family.”

It is a concept that is in high demand in a city like Varanasi where thousands of widowed women are left to fend for themselves. This is because Varanasi is considered one of Hinduism’s holiest cities. Lord Raj Loomba, who started the Loomba Foundation for vulnerable women and children, explained to the International Business Times why this was such a concentrated problem:

“When widows are thrown out of their households, they come to Varanasi because it is a holy city. It is the favourite city of the Hindu deity Lord Shiva, and they believe that if they die there they will go straight to heaven. Widows call it moksha – when the final release from reincarnation is gained.”

However, many widows in Varanasi are under the age of 45, and many still have long lives to plan for financially. Women-centric banks can provide both the financial protection and education needed for them to move forward.

And women-centric banks have been successful in other parts of India as well. The Women’s Cooperative Bank Ltd. in Goa has shown that smart investments can improve the social standing of everyone in society. This bank, which was formed in 1972 with less than 500 women now has over 17,000 members and gives loans to both men and women in need of assistance.

The women’s collective in Varanasi is now headed down the same path. Giving women a financial education while ensuring they no longer have to rely on husbands or family for independence is one of the most important steps in women’s empowerment, proving that regardless of where they came from, these ladies can now create a future of their own design.

Photo Credit: Jorge Royan/Wikimedia

51 comments

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