[Reader-list] Experiences of another Yunus

[Syed Yunus]

Dear All ,
Arshad,TAj and others have shared their concern over Micro credit and
it remind me of a note i wrote around three years back when i was
working with a rural development organisation .

Indebted life
(wrote three years ago In SARMATHURA ,Rajasthan)

It is very sad that Self help groups promoted by our organisation are
purely working as saving and credit groups or perhaps they are groomed
as saving and credit groups. Strategic efforts are made to link these
groups with the mainstream financial institution that too is an
extension of saving and credit activity. The values and norms
inculcated by the worker facilitating these groups revolve around the
successful transaction of money in the group so that the members can
became efficient in their financial dealings .after sometime when
these group are linked to banks they are trained enough to maintain
their accounts and repay their loans, which they take from banks time
to time. The banks as financial institutions are eager to give number
of loans to these smoothly running savings and credit  groups because
they know that the peer pressure in groups will make sure the
repayments of loans and thus there will be less non performing
assets..

Credit living

The culture of credit living is spreading very fast the hypothetical
situation or assumption I am making is purely based on my personal
disliking about credit living. In the urban areas various finance
schemes to acquire lucrative commodities like Ac frige and bikes, Home
etc. have made quite a number of people indebted and many of my near
and dear ones are repaying instalments of  one thing or another i.e.
the EMI trap.

While working in district Dholpur Rajasthan, especially with groups of
poor women a sceptical thought came in to my mind .that financial
institutions might engulf these people into their trap. And since then
I am sceptical about the micro finance institutions specifically about
saving and credit groups S&C.

The linkages of these groups to bank is necessary as most of them are
poor and unable to meet their daily needs from their income so to
enhance their income they need some investment which they can
channalise from banks. But while doing so, the culture they will adopt
might be dangerous as they might indulge in consumption that is not
productive.

Private Banks and their role

Various private banks have jumped in to the sector to provide loans to
saving and credits groups e.g. ICICI. Right now they are offering the
same interest rates as offered by other banks .But with the speed they
are covering the unexploited market, because of the inefficiency of
the govt banks or even the competition (which is always healthy for
such companies), might be injurious for our Poor's health.

While I am working with rural poor families to promote savings and
credit groups I can say that on one hand I am helping them to come out
of from the exploitative systems of sahookar's on the other I am
pushing them in the trap of bigger sahookar's . Who are not even
physically visible to them.

Donor agency and its expectation

Self help groups and the concept of mutual help through groups is the
only hope that ignites me and strengthens my belief that we have at
least one 'WMD' weapon of mass development. But the hues and cries of
mainstream are forcing us to work on 'savings and credit' and not on
'self help or mutual help'. As a result in the name of mainstream we
want a universal system that is micro finance institution.

The donor agency gives us money to form group that can be linked to
banks. Pressurised by the heavy targets we try to evolve some
mechanism so that we can fulfil our commitments easily and quickly,.
Thus it can be said that we are helping mainstream financial
institutions to run profitably. the assumed by products of mutual help
and social issues fizzle out some where and 'we 'convince our self
that it does not come in our 'mission or vision' or should be taken up
by some body else.


Yunus

-- 

Change is the only constant in life !