Micro Credit

Sharana has established methods by which to extend of micro-credit, or small scale loan assistance, to women in Angalakuppam. These loans allow women to start their own small businesses, allowing them to generate income and thereby become autonomous. At its peak, there were 49 members participating in Sharana’s micro-credit program at Angalakuppam: 7 groups of 7 women each. In order to obtain a loan, the beneficiary must provide the Sharana social worker with an application detailing the type of business activity and budget for that activity. Women are then organized into small groups; each group elects a manager. The age range for those participating in the micro-credit program is 18 to 55 years. Sharana does not finance interest free loans but requires beneficiaries to perform small jobs such as landscaping and maintenance at the local community centre. In this, Sharana aims not only to empower the individual woman, but also emphasize the importance of collective responsibility and ownership of the community center.

Loans have been used to finance various projects such as: Livestock and Agricultural Products, Sewing Machines, Idli Shop, Grocery store, Telephone booths, Fishing Nets, Green Coconut sales. [For livestock loans, Sharana purchases insurance in order to safeguard its investment.] The program of micro-credit has not only increased the income of beneficiaries but it has also brought confidence to each and made them aware that they have not only a means to become independent, but a valuable, contributing role in society. Thanks to this micro credit programme our living conditions have improved a little bit.

Today at least I can have a positive outlook towards life.  There was a time in my life when I had lost hope with life and life seemed a journey of hell.  But today thanks to Sharana we have the possibility to share the platform with other women who have somewhere the same problems.  This programme of Micro credit not only has helped us economically but also given us a confidence and hope—Govindammal

Repayments: Loan repayments are made every 15 days, to the designated social worker. Repayment amounts depend on the amount of the loan.  On average, it amounts to Rs 250 (or 5 €) per fortnight.  A loan of Rs 7,500 (150 €) should be repaid within 18 months. Top-up loans are allowed only when prior amounts are repaid. Sharana’s micro-credit loan program has a repayment rate of approximately 70%.

At present, Sharana is investigating the prospects for developing micro-lending schemes in Mathur. In Angalakuppam, however, the scheme is in a monitoring and collection phase due to a shortage of funds. As more funds for micro-lending become available, Sharana will extend further loans to women who continue to apply.