A late start, and a long way to go...
Can a mere five hundred rupees change a life? This sounds implausible, as prices spiral by the day. But in numerous villages in India, this miracle is quite real; millions of poor women are today using small loans to rewrite their present and future. Many of them have not ever seen the corridors of a high school, but are using common sense to propel their entrepreneurship and group business activities.
Micro credit can aid employment and sustain households giving them opportunities they never had before." It is called micro credit with good reason. The size of the loan is typically small. The borrower is usually battling against poverty. The repayment schedule is simple and short. And, the activity for which the loan is taken is often of a small nature. But poor women, who are in the forefront of the micro credit movement, use the small loans to jumpstart a long chain of economic activity from this small beginning. As they have enormous pride in their integrity, they repay quickly and reliably, not wanting to be seen as defaulters. Then, they begin again, this time with a bigger loan - and keep expanding their profit base until they do not need the loans any longer.
Micro credit can aid employment and sustain households giving them opportunities they never had before." It is called micro credit with good reason. The size of the loan is typically small. The borrower is usually battling against poverty. The repayment schedule is simple and short. And, the activity for which the loan is taken is often of a small nature. But poor women, who are in the forefront of the micro credit movement, use the small loans to jumpstart a long chain of economic activity from this small beginning. As they have enormous pride in their integrity, they repay quickly and reliably, not wanting to be seen as defaulters. Then, they begin again, this time with a bigger loan - and keep expanding their profit base until they do not need the loans any longer.
Micro credit has given women in India an opportunity to become agents of change. The movement has made them more confident than ever helping them to explore new horizons, new dreams.
That is the positive side of the story. The negative one is that India's demand for micro credit is Rs.500 billion, and only Rs.18 billion of this amount has been generated so far; there is still a long way to go.
- 75 million households in India depend on moneylenders to meet financial needs
- Almost 90 per cent of people in rural India have no access to insurance
- 50 million households are landless and need small credit to start some economic activity.
- Even families earning Rs.4000-5000 a month in urban areas spend huge portions of their earnings to service debt.
