Financial Inclusion and Sustainability
SWATHI JYOTHI: Securing a financial future
Financial compulsions often drive women into sex work. The financial quagmire worsens if women do not know how to manage money or do not have access to financial management mechanisms. Women are offered more money for sex without condoms and financial insecurity could compel them to take on such offers, thereby increasing their risk of contracting HIV. In addition, the volume of clients and the amount that women are able to charge is also dependent on financial security.
Some money issues faced by women in sex work include:
- Keeping money safe from husbands/partners or rowdies
- Inability to access mainstream financial organisations due to the lack of address or identity documents
- High interest rate for loans from non-banking financial institutions
Recognising the need for saving and credit, self help groups were started within Pragati project. In a matter of months, it became evident that the self-help group model was not suitable for the women in sex work in Bangalore who were largely street based.
A microfinance institution
After deliberations and consultations with experts, during which several institutional models to provide financial services to women were considered, Swathi Mahila Sangha decided to form a microfinance institution in the form of a cooperative society. The Society was launched on 1st of December 2006 registered as Swathi Jyothi Mahila Vividhodesha Souhardha Sarkari Niyamita, under the Karnataka Souharda Act (1997), in September 2007.
An independent board was established in October 2007 to steer and guide the activities. Savings products were offered from December 2007 and credit services started in March 2008. The products offered are:
- Saving bank account – Swati Sarla
- Recurring Deposit – Swati RD
- Term loan – Swati Swabhimana
Salient features of Swathi Jyothi:
- Managed and owned by women in sex work; services provided with respect, dignity and trust;
- Provides a safe and secure place for savings;
- Provides easy and cost effective credit; no collateral for loans since guarantee is provided by common interest group (CIG)[ CIG - is an abbreviation for Common Interest group which is a three member group formed for the purpose of availing loans .Each member acts a guarantor for the other members in the group for taking a loan. There is no other surety required to avail a loan.]
- Provide products and services based on needs of women in sex work.
IMAGE TO BE ADDED
Swathi Jyothi has made a beginning. Some of the changes that are visible are:
- The discipline for regular savings
- Women taking up alternative/diversified livelihoods, movement from pavement living to rented homes and supporting their children's education
- Increased confidence to negotiate condom use and prioritize health
- Building trust: Some women had earlier joined mutual benefit trusts that had closed down. This negative experience made them hesitant to join Swathi Jyothi. Awareness building and showcasing successes were undertaken to address this challenge.
- Formation of CIG: The CIG model is based on organic groups evolving. With the community of women in sex work formation of organic groups is a challenge.
- Accessing external credit: A co-operative model/institution can attract external credit funds if it works at a scale. For 3-4 thousand members, savings should be in the range of Rs. 6-7 crore (1.5 million USD). At Swathi Jyothi achieving this benchmark has been a challenge
- Successful integration with HIV services: As a model Swathi Jyothi has been successful in attracting women in sex work to visit the drop-in centers (from where Swathi Jyothi branches operate), who then take the opportunity to avail of other services available at the centres including HIV related clinical services and counselling.
- Regulation of systems and processes: The process of registration of a microfinance institution for women in sex work was not easy and took almost 8 months to materialise. Registration has led to regulated systems and processes.
- Membership: Over 7791 members have confidence in Swathi Jyothi and are a part of it.
- Share Capital: close to Rs 1784600/- Swathi Jyothi’s share capital forms a substantial base for the institution.
- Recovery: The Swathi Jyothi members and management team have worked hard to ensure 100% recovery, lending credibility to the CIG model
"I have money in the bank and can refuse un-safe sex; I don’t have to worry about my next meal" – Member, Swathi Jyothi