Banking at bottom of pyramid

While the nation’s banking system saw a revolution of sorts last week with the launch of the Bharatiya Mahila Bank, an unassuming school passout in Ahmedabad, has been making giant strides in financial inclusion in her own quiet way.

Madhuben Hasmukhbhai Parmar, 40, is an example of how many a woman is working well away from the arc lights, defying biases and stereotypes.

Madhuben is the Chief Operations Officer of Saath Savings and Credit Cooperative Society Ltd, a leading cooperative society here with nearly 20,000 members and a turnover of around Rs 10 crore.

About 6,000 of Saath’s members are poor Muslims, including 4,000 women. One of the branches is exclusively for the 4-lakh-strong Muslim community at Juhapura, a ghetto on the outskirts of Ahmedabad with hardly any civic amenities.

Saath has seven branches in Ahmedabad’s slum areas, offering loans of up to Rs 30,000 to the economically downtrodden to set up their own livelihoods.

“Our recoveries are about 98 per cent,” Madhuben told Business Line . “Only 35 out of 1,000 clients were unable to pay on time.”

The Society has a staff of 80 — while only a quarter are graduates, most are computer-trained.

Only 15 members of the staff are women, but the managers of all the seven branches are women. Their monthly salaries range from Rs 5,000 to Rs 10,000. As COO, Madhuben, draws a gross salary of Rs 18,300.

Madhuben has been associated with Saath, which principally works among the bottom of the pyramid of the socio-economic infrastructure, for the past 22 years.

Rajendra Joshi, founder and Managing Trustee of Saath, said the Society follows the model of Bangladeshi Nobel laureate Muhammed Yunus’ Grameen Bank. It lends money only to small groups of 4-5 people who stand guarantee to one another.

The society has brought down poor people’s dependence on loan sharks and moneylenders.

These beneficiaries were earlier unable to open accounts and procure loans from traditional banks due to lack of penetration of the formal sector, unavailability of the required documents and absence of collateral security.

Saath charges 24 per cent interest, which reduces every month, and the overall interest comes down to just 13 per cent in a year, said Joshi.

“We had an outstanding of Rs 7 crore last month,” Madhuben said, adding that the Society has advanced loans of Rs 15 crore over the last five years.

Saath registered a profit of Rs 20 lakh last fiscal. It is is now awaiting permission to expand beyond the 20 wards of the city.

Madhuben lives with her husband, an agarbati -maker, two school-going children and her in-laws.

And she had not heard of Bharatiya Mahila Bank until yesterday.