JOIN USSmita Ramakrishna and her team realise that a small impetus, like low-interest loans, can empower women, especially those from conservative communities, writes A Varsha Rao
When Shobha Raju Shelake was abandoned by her husband for having borne three girls, she decided it was time to regain her self-respect. With the help of a loan from Rang De, she bought a buffalo and slowly put her life back on track, encouraging her sisters to do so as well. Having repaid her loan, today, she is the leader of a Self Help Group (SHG) in Maharashtra and aspires to give her daughters a good education.
Usha Dhakad was the subject of ridicule owing to her being from a lower caste. But ignoring the constant jibes and barbs, she decided to start a vegetable market. Rang De offered her a loan, with which she sells fresh vegetables from door to door, pocketing a handsome profit. There is no more discrimination and she is happy that she is contributing to the family income.
These are just some of the heartwarming examples of how women across the nation have found their voices and are leading better lives. Welcome to Rang De, a non-profit organisation working towards the betterment of economically backward
families.
Working on a peer-to-peer lending model of microcredit, Rang De is spreading the colours of joy among many families.
Inspired by the Nobel-Prize-winning concept of Grameen Bank by Muhammad Yunus, Rang De is an online platform through which one can invest money in any of the borrowers advertised by them. The amount invested is returned with a nominal interest, within a year or two.
Founded by Smita Ramakrishna and N K Ramakrishna in 2008, Rang De is a groundbreaking effort to lower the costs of microcredit in the country. “It is an
individual-to-individual model. Every individual can support a specific person based on their geographic location, gender or business. Also, we realised the microcredit rates in the country were high. We created Rang De to address the two main issues when it comes to microfinance - accessibility and high interest rates,”
elaborates Smita.
Based in Bangalore, Rang De has worked in 16 states and is currently active in eight. “I remember when we first started out, I came across Mumtaz in Maharashtra, who was a homemaker till she got a loan from Rang De. She then started making potato chips. From one kg of potato chips, she went up to 30 kg of potato chips. This also changed her home dynamics. Since she started earning, she even got a say in all her household matters,” says a visibly- proud Smita.
It is interesting to note that 94.46 percent of the borrowers in Rang De are women. Is it a conscious decision? “Yes, it is. Although we don’t like to discriminate against men, we would like to see an impact on the status of women on a ommunity level. Through our efforts, we are seeing that kind of change.
There have been so many instances where women have taken loans on behalf of their husbands. This has changed the equations and led to greater respect for women,” says Smita, who, perhaps is a shining example of the much-needed women empowerment in the country today.
But what about any grapes turning sour? Surprisingly, they haven’t had a single instance of wilful default. In genuine cases of default, the team ensures they know the reasons. “In case of any default, we have a contingency fund which is 0.5 percent of the interest rate. We pay back the investor with this amount,” says Smita.
While there are numerous rural banks with enticing schemes, why do people come to Rang De? “We work in areas where there is little microfinance. Our interest rates are lowest in the country. Where Grameen Bank has 20 percent interest rate, ours stands at 18 percent. Moreover, we are community focused. We are in constant touch with the borrowers. In case of any default, you don’t see banks rushing to the borrowers to know the reason why. We go to places where banks usually don’t go - into the lives of our borrowers. This also raises the trust level of the borrowers in us and they make a conscious effort to not default on us. They would never let down us as they know we raise money from individuals. Sure, we haven’t reached the level of Grameen Bank or other rural banks, but we are inching towards that,” spells out Smita, who has done her masters in social work.
To set up a model of this scale with hundreds of investors, borrowers and field partners must have been hard, both professionally and personally. Smita agrees, “The biggest issue we faced while setting this organisation up was the technology because we first focused on getting our operational part right. We had a robust background, but our front-end, which is basically to attract social investors was ignored. I come from a social background but my husband, Ram, worked as a software consultant in the UK. It was risky leaving the job there and starting something on our own. Though our parents didn’t oppose, they had their concerns.”
So, where does Rang De stand two years from now? “We aspire to keep doing what we have done over the past six years. We want to scale up meaningfully and reach out to more people,” she says.