Scaling up women’s cooperative banks to bridge the gender gap

Shri Mahila SEWA Sahakari Bank has been around for over four decades. Even so, owning one is still beyond the reach of the average person. We need products, but we must not lose focus on processes.

Banking should be simple and based on mutual trust. Banks will have to devote time to reviewing their operations, whether it is a small loan application or a more complex product such as microfinance or pension.

The National Family Health Survey Round 5 (2019-2020) reveals that 77.4 percent of rural women have a savings bank account. However, there are gaps in the economic integration of women. In rural areas, the loan repayment rate for women businesses is 2.5 times higher than for men. This gap is equally significant in the area of ​​digital financial integration, where 20 percent of rural women reported holding debit and credit cards compared to 64 percent of men. Their accessibility to mobile phones is 20 percent lower than that of men, and in terms of the Internet, it is 50 percent lower. There are many inherent gaps in the provision of financial services, especially credit, to women in rural areas.

Consistent effort

Women’s cooperative banks work consistently to provide credit and loans to women in the low / middle income group. Mann Deshi Mahila Sahakari Bank, Pune, a women-centered cooperative bank, provides small down payment for women with different cash flow and living patterns.

The bank offers a weekly cash credit product for small vegetable sellers who need cash to manage close market transactions or hatat. It is one of the most sought after services. The product was the result of several pilots and continuous engagement with customers.

The process of applying for a loan at many banks is still laborious and so women approach Mann Deshi for buffalo / goat / chicken loans.

Mann Deshi has structured several credit products for rural women who have turned into micro-entrepreneurs today and have successfully repaid several business loan cycles.

Simplifying mobile banking, biometric authentication, financial literacy, credit advice, digital literacy, customer attitude analysis and behavior patterns are some of the processes that can add efficiency to Banking.

Mann Deshi and SEWA Shakari, as cooperative banks under women, have turned financial inclusion into a strong and profitable business proposition, meeting a range of financial needs of rural women and their families through structured, well-designed products.

Women are deprived of property ownership and control over their finances. Weak land titles, lack of collateral, the right to family property, lack of guarantor and poor access to mobile devices and technology weaken the progress of economic integration.

Research shows that when women have greater access to finance, they spend more productively on the health, nutrition and education needs of their families. .

With around 1,500 urban cooperative banks and 360 regional central cooperative banks, there is enormous potential for boosting financial inclusion.

It is vital to meet the different economic needs of women in order to expand rural entrepreneurship and employment. This requires detailed gender-based data, a larger number of women correspondent companies, improved digital integration.

Hema is Director and Anshu is Assistant Professor, Vaikunth Mehta National Institute of Cooperative Management, Pune

Posted on

April 17, 2022

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