Supporting Poor Women through Income Generation

Background

Women Acting Together for Change (WATCH) has been organizing rural poor women and disadvantaged communities like people with HIV/AIDS, disabilities, affected by leprosy, Sex workers, etc. in Okhaldhunga, Kathmandu, Lalitpur, Nawalparasi, Rupandehi, and Kapilvastu for accessing their rights and resources. It has formed groups and federated them in federations or organization. Some of them are active and some has stopped operating. However, most of the groups are still active and operating in a local level. WATCH realized that working with poor and disadvantaged people require supporting their livelihood also. So it started Poverty to Property Exercise to identify and manage their resources. It has been successful with about 80% of the families. Some of them have become quite successful and have started their own small enterprises. Due to lack of access to public and donor resources have not helped them. WATCH is quite stretched out so it could not follow up and support as needed.

Through the process it is possible to bring up the poor families but traditional donors will not support it because it recognizes and respects people’s knowledge and interest, slowly builds on them to make them self reliant. Based on this learning WATCH proposed to concentrate on 20-30 families per year with interest free investment support of Rs. 20000-100000. The recipient family has to return in one cycle of production and sell. WATCH plans to gradually create a revolving fund for this purpose. It is estimated that about 20% of investment will not be realizable. WATCH proposes to recover such loss by its own sources and from other donors. WATCH will utilize its existing human resources for this purpose.

The earthquakes of 2015 in Nepal exposed a lot of weaknesses in our system. The government was not ready for supporting and relieving people. Policies and regulations were not good enough to deal with such calamities. Donors and NGOs also did not have strategies to deal with such situations. Support started pouring in which created chaos, some people got more than needed and some have not received any. Those who were not affected but powerful got more benefit than others. WATCH also wanted to support the victims but it did not agree with the other donors because they were making and behaving the affected people as beggars. So WATCH also prepared a concept note to support the affected people and a German organization decided to support for two years. This project was to be implemented in Harkapur, Okhaldhunga and Devichaur, Tokalmath, Danuwar Gaun in Lalitpur. One of the projects was the Poverty to Prosperity Exercise for which the Nepalese American Society also decided to support.

Objectives

The project has the following objectives;
1. Support 20-30 rural poor families with investment for income generation.
2. Create a revolving fund to support such families sustainably.

Activities

1. Support 20-30 rural poor families with investment for income generation.

WATCH has been conducting Poverty to Prosperity Exercise with the women’s group members in its area. It is decided the project investment will focus on Lalitpur women’s groups. After the exercise it was planned form a three member committee to select the recipients. All together 28 families were select, Lalitpur Rs. 785,000.00 are invested. As the investment is provided with the women’s groups’ recommendation it was decided that women’s group get 6% of interest and 6% goes to the Awake Nepali Rural Women’s Coalition, of which all recipients are also the members. The principal will be returned to WATCH and it will be deposited in a revolving fund WATCH has created for this purpose. Some of the groups have taken second round of investment. Besides, similar investment is made in Harkapur, Okhaldhunga; Chhaimale, Kathmandu and Banganga. Kapilvastu. WATCH plans to expand to Rupandehi and Nawalparasi also. All the invested money is returned. Nobody defaulted. There is demand for next round of investment. WATCH plans to start small enterprises in the next round. All together WATCH plans to invest 4-6 million Rs.
2. Create a revolving fund to support such families sustainably.
WATCH has created a revolving fund or Poverty to Prosperity Fund of Rs. Eight million with two million provided by New ERA Nepal and with donation from its well wishers. The fund is deposited in a Muddati khata in Sanima Bank. The investment returned by the recipient will be deposited in this fund and further investment will be made based on the performance of the recipients.

Monitoring:
WATCH staff first conduct the Poverty to Prosperity Exercise in which all the family resources are assessed and their management situation is also considered. Based on this some possibilities and opportunities are identified. Besides, the family had to do some activities to be eligible loan like cleaning, making utensil drier, covering of water, sanitation, etc. To make them used to paying back, the first loan is usually small one. But in some cases, if there are possibilities and potentials big loans are also provided. WATCH staff and the group members make sure that the recipients spend on what they had planned. WATCH staff usually visit every month and monitor them. If required WATCH staff also provides technical know-how. Usually, urine manure, liquid manure, mulching, etc. are also promoted. Tunnel farming with tomato and other vegetables have done well. Goat rising is easy to do. Small petty shops are also OK. Buffalo rising is quite profitable but needs a lot of investment. Tea shops and raksi making are quite profitable.

WATCH had two interaction meetings in Lalitpur with the recipients. All the recipients were quite positive of the project. Almost all of them had made some money and they promised they could easily pay back according to the plan. They also requested more investments to further the business. WATCH had a developed a simple business plan for further investment. It is also learnt that rather than investing in only one business if it is invested in several related business there is more possibility to make money.

Lesson Learning:
There are a lot of lending agencies in the villages these days. But it is not the same kind of relationship as with WATCH. WATCH staff is quite in touch with them and provides help and support when they need. People need to see what is possible with their own resources. Once they start business and become successful, they start exploring by themselves also. There is a case study from Kapilvastu. The family had almost nothing but started raksi making with the investment. Even she did not have utensils to make Raksi so she loaned from neighbors. Now, she has a restaurant (teashop), meat selling shop, petty shop, raksi making all in one compound. She has become quite affluent. Her confidence and dignity is quite admirable. It is not only with one but we can provide support continuously for some time all of them can come up. WATCH has started to promote the idea of using income or profit for consumption only after setting aside for the investment so that they do not have to depend always on the outside donors.

Financial Report:

WATCH has received US$ 7000.00 or equivalent of Rs.7,86,218.48 from the NAS. The money invested was Rs. 7,85.000.00 which shows the balance of Ra. 1,218.48. As all the investment is returned, the amount will be invested in the next cycle. The result until now shows that profit from investment is 25% to 300%. The investment in the agriculture activities has low return whereas in the business is quite high return but business opportunities in the village area is quite limited. WATCH also planning to encourage integrated enterprise so that risk is minimized. WATCH also plans to encourage insuring agriculture activities and livestock rising.