Vibhatai Bhilkar, a widow of one of the thousands of farmers who committed suicide in Wardha district of Maharashtra has successfully set up her grocer shop after a year of her husband‘s death.
Vibhatai Bhilkar, a widow of one of the thousands of farmers who committed suicide in Wardha district of Maharashtra, has successfully set up her grocery shop a year after her husband’s death.
Similarly, Madhuri Bhotule, another widow from the state’s Yavatmal district set up a sprinkler set to facilitate irrigation for her a small piece of agricultural land she owns.
Two straight droughts in 2015 and 2015 have forced more than 8,000 farmers to commit suicide. Latest data shows nearly 365 farmers took their lives due to scant rainfall and poor harvest which resulted in financial stress.
Maharashtra continues to witness the highest number of farmer suicides at over 3,000 triggered due to loss of their farm-based livelihood resulting in non-repayment of huge debts taken from money lenders and banks.
However, with the likes of one of the BJP leaders making disrespectful remarks towards such farmers calling them “subsidy lickers” or “not a real farmer”, often the suicide numbers fail to check the other side of the grim reality faced by familes such as Vibhatai and Madhuri's.
Around mid-2015, SAFL (Sustainable Agro-commercial Finance), a farmer and agriculture-focused non-banking finance company (NBFC) introduced collateral and interest-free loans to support many such widows in order to make them set up their livelihood.
Like Vibhatai and Madhuri, 106 widows in two districts of the Vidharba region in Maharashtra have availed loans worth over Rs 27 lakh as on today to start their own small and micro enterprises such as small kirana shops, bangle shops, tea/snacks corners, sewing machines, ata chakki machines and agri and allied activities in the form of sprinkler irrigation, small equipment loans, small crop loans, etc.
Along with last week’s approval of Rs 25 lakh capital, SAFL (promoted by Jain Irrigation Systems) has allocated Rs 50 lakh so far towards this initiative not only helps widows by providing necessary finance but also empowering and motivating them in order to make their livelihood sustainable, said SAFL’s Managing Director and CEO Arvind Sonmale.
He says, “The easiest is to give charity but they (widows) spend it and get used to the handouts. We thought that after they spend that money, then what? We thought let’s give a loan, so psychologically it is a “loan” and they know they have to repay, at the same time it must not be a burden and it should be for her to start something so that they can have continuous livelihood. Some have already started repaying from their savings ahead of their repayment schedule.”
From the government list of farmer suicides, SAFL visits the family, make enquiries and lends money to their widows to help them become entrepreneurs and earn their own living.
He also added that an assistance of Rs 3 lakh is given but is rejected if it is due to alcohol problem or any sickness. "We think that the widows are the sufferers after he (farmer husband) is dead and gone. So the widow and children need help. Based on the help she has got, we go and assist them to start their own, convince them.”
SAFL, which also means "success", makes the loan payment directly to the vendor from whom the woman buys the raw material or her basic requirements to start the enterprise “so that the end use is monitored”.
Up to Rs 5,000 the loans are given without interest while interest charged on loans between Rs 5,000 and Rs 15,000 is 5 percent; 6 percent on loans between Rs 15,000 and Rs 25,000 and 7 percent from Rs 25,000 to Rs 50,000.
All loans are given on simple interests and without any security for up to three years and the women borrowers can repay the loan based on her cash flow pattern which will be decided on a case-to-case basis.
What if a woman’s enterprise fails to take off and bears a loss? Sonmale says, “Internally, our guideline is that in case they are unsuccessful, we will write off the loan…And we don’t also want to harass them but at the same time we didn’t want to give charity."
SAFL also handed over cheques separately to another eleven widows to start flour mills, shops for bangles & bindis, imitation jewellery for women, utensils shops, kirana shops, cosmetics shops, sewing machines for tailoring enterprises, motor pumps for lifting water from nearest lakes, diesel engines for water lifting and sprinkler irrigation for their own available unused land.
SAFL is one of the few farmer focused Indian NBFCs to provide agri-infrastructure loans in Maharashtra, Karnataka and Madhya Pradesh; and plans to expand across other regions of existing locations and further to Tamil Nadu, Rajasthan, Haryana and Gujarat over the next two years.
As on December 2016, SAFL’s overall loan disbursement stands at Rs 400 crore to 32,000 farmers with a loan book of over Rs 250 crore and aims to end the financial year with Rs 300 crore.