Sri Lanka banks on poorest women
Samanthi Dissanayake
'Grameen' concept: Women's banks are flourishing in Sri Lanka
but there are questions about whether they really make a difference to
poverty. There is barely space to move in Philomena Aranasingham's front
room.
She lives in the Kirullapone slums in the heart of Colombo, moments
away from a still waterway with sewage floating by. Her room is swamped
with red velvet curtains and silk shirts. She runs a lucrative tailoring
business from here. "Five years ago I had nothing.
Now we have comfort at home, a phone and our children can go to
school without shame." The drapes are a major commission from the Sri
Lankan army. Philomena was the first recipient of loans to women from
the Grameen bank, which has operated in Sri Lanka for almost six years.
From a blast to a bank When a bomb ripped through the Central Bank of
Colombo in 1996, Lalith Kotelawela, was among the injured.
It was while recuperating in hospital that he was inspired by
Bangladesh economist Muhammad Yunus' book about micro-credit schemes
aimed at the very poorest women in his country. He decided to import the
'Grameen' concept to his own country.
The bank has now lent to 78,000 women on the breadline throughout Sri
Lanka, exactly the kind of women who wouldn't normally qualify for loans
from banks. Two doors down from Philomena's home, Laxmi Priya, another
beneficiary of the Grameen bank, crouches over a wok of boiling oil
frying snacks to sell on the street. "Before, we only had a small wok.
Now we have gas cooker, a big pan and money to employ one person.
Life is a little easier for us these days." Laxmi and her husband
Nadaraj live, eat, fry and sleep in one room. Women's banks are nothing
new to Sri Lanka. Women have long pooled savings to provide loans for
each other using a kitty system. In the late 1980s, grassroots women's
groups in villages throughout the impoverished Hambantota province set
up informal banks, where village girls studying A-levels handled all
transactions.
These groups became the Janashakthi Bank Society, where to join a
woman must have an income below the official poverty line. Grameen also
lends to those least able to repay loans and at minimal interest.
Transactions take place in the heart of the community in temples,
churches and village halls. It represents the involvement of a major
commercial player with serious networks, money and banking experience.
The bank has a 100% repayment rate according to Victor Ratnayake, its
deputy chairman. He says this is because they lend only to women. "Women
have the stability of the family at heart. Men would use the money for
drinking and entertainment.
Our country needs to invest in women. This is the way for us to move
forward."
The loan structure is probably the key to its repayment rate. Women
come up with ideas for their own businesses and form small groups to
qualify for a loan.
If one group member defaults, the others are held responsible. But
some argue that a vibrant women's banking sector has not delivered
enough change.
"Women are just a little bit better off than they were. Debt is less
of a problem but income levels have not risen substantially," says
Professor Swarna Jayaweera of the Centre for Women's Research in
Colombo.
"These schemes work well to lift women out of absolute poverty as
they do in India and Bangladesh." She argues that Sri Lanka needs more
investment in management and marketing expertise - not small loans to
enable women to keep their tiny cottage enterprises just ticking over.
Laxmi and Nadaraj are a case in point.
The lease to their all-purpose cell has run out. They need to find
another place, preferably with a toilet, as Laxmi is heavily pregnant.
"Without property of our own whatever we earn from our business goes on
rent." They survive but see no way of escaping a low-income cycle.
Marital business Lending only to women isn't necessarily the recipe
for harmonious relations between man and wife. Victor Ratnayake has been
chased down the street by a knife-wielding husband, irate that food had
not been appearing on the table ever since his wife was diverted into
self-employment. The husband eventually came round.
Ratnayake maintains that teething problems disappear when the overall
benefit of the loans became clear. But this assertion is met with
scepticism by the Rural Women's Organisation Network, a small group
operating on the southern coast.
"Husbands do allow the women to get self-employed, but whatever
income they generate goes straight into their pockets," says Soma
Hettige, secretary of RWON. She helps women battered by husbands trying
to extract money for gambling. In her experience, wifely earnings do not
magically summon up reason if dearly-held patriarchal structures are
undermined.
After the tsunami the area RWON works in was devastated by the
tsunami. "I had a small fruit stall. I don't even have a home now," says
Somavati on Weligama beach. Yet the old financial self-help groups still
exist, lingering on the beach by the ruins that were once homes. They
have been transformed into social networks in the aftermath of the
disaster: "We're all friends.
They can build in my garden," says Jayavati a group leader.
These women have plans to start again their spice shops and food
stalls. They will use loans for women to help them on their way.
Courtesy BBC |