Mark and Sue Real, Opportunity supporters from Colombus, Ohio, traveled on an Insight Trip to India to meet Opportunity's field staff and clients. The trip was eye-opening and inspiring—and they graciously shared a few of their experiences with us. We will be sharing their stories over the course of the week. Read Part 1 here, Part 2 here, and Part 3 here, and learn more about traveling on an Insight Trip with us at opportunity.org/insight.
The Satya-Micro Fin Ltd in Agra is a micro-finance non-governmental organization serving Agra, home of the Taj Mahal. Satya’s vision is: “To be a catalyst for the socio-economic uplifting of five million households by the year 2025.” Satya is an India-based partner agency of Opportunity International.
Satya’s modest office overlooked a donkey tethered and grazing across the unpaved street. A bicycle rickshaw carried two well-dressed passengers. A horse-driven cart transported bags of rice.
At the office, Director of Operations Subhash Acharya and his team were proud that their new branch already had enrolled 1,700 clients. These clients are part of an India-wide program to provide every citizen with a fingerprint and retinal scan account accessible anywhere in the country. Since most poor Indians have no paper identification, these scans provide people with a digital identification that enables them to open a government bank account which can then be transferred to a micro-loan account. The average loan is 30,000 rupees ($500).
The staff explained that most of the families they serve would have otherwise turned to loan sharks. The difference in interest rates is dramatic. Satya loans charge a market interest rate of three to four percent monthly. Loan sharks charge eight percent or more. While clients regularly pay off Satya loans and thus qualify for larger loans, families who owe money to loan sharks often see the amount they owe continue to grow and thus they are unable to expand their businesses.
To qualify for a Satya loan, the loan client's family must have a cell phone and own their home. Before qualifying for a loan, each client must complete a three-day compulsory training and the husband and wife must co-sign a loan. Each family must have a savings account and have made three deposits and withdrawals in order to qualify. As a result, the default rate is only 4%.
We walked to the home of a client where we heard a dozen women singing about the joy of belonging to a trust group and building a stronger future through their loans. We were invited to remove our shoes and be seated on a Valentine’s Day sheet. As Subash translated, each client explained how they were using loans for a variety of businesses including construction, a grocery shop, and buffalo-breeding.
As members explained how they were using their loans, each member accessed their loan records by a portable fingerprint reader connected to a laptop which contained their loan balances and repayment history. The loan officer worked with each woman to confirm their remaining loan amount and today’s payment.
The staff told us that due to limited educational opportunities, only 85% of women clients could sign their name and 60% could read more than their name.
Trailed by neighborhood children, we could hear a second loan group singing the same song about the joy of belonging to a trust group. We were invited to remove our shoes and sit on a floor covering tarp advertising Satya MicroFinance. There were 11 women in this group each colorfully and distinctively dressed.
Their families all qualified for loans to purchase shoe-making materials and sewing machines. They used leather and other materials to make shoes in their home. In most cases, the husband and the entire family were engaged in making shoes. A typical pair of shoes cost about three dollars in materials and nets the family about 50 cents per pair.
When asked how Satya could improve, virtually every woman answered with “larger loan sizes."
One enterprising family produced an average of 100 pairs of shoes a day with the husband and six to eight employees. They told us it takes five days to train a worker and they had a hard time hiring reliable staff. This same family gave us a guided tour of the snack shop they operated as a secondary source of income.
As we were threading our way through the narrow passageway to our car, we saw several bicycle carriers loaded with dozens of shoe boxes ready for transport. Our Insight trip leader, Linda VanderWeele, bought a pair of leather boots for her grandson, delighting the shoemakers.
We were impressed by the knowledge level and experience of the Opportunity and partner agency staff with whom we spent time. Being able to see how the loan recipients were using their funds to improve their families’ lives in the world’s largest democracy was inspirational.