Chetna Gala Sinha—MDM

Mann Deshi client using technology to improve her life. Photograph by Cyrill Ardin

The Organization

Mann Deshi Mahila (MDM) combines financial products, business development services and the formation of new social networks to help rural women entrepreneurs succeed. It has enabled more than 62,000 women to build assets, own property, forge market linkages and emerge as key developers of their local ecosystem.

Chetna Gala Sinha is the founder and head of the Mann Deshi Mahila (MDM) group of social enterprises. The group comprises a bank (Mann Deshi Mahila Sahakari Bank—MDMSB), a not-for-profit (Mann Vikas Samajik Sanstha—MVSS) and a microfinance institution (Mann Deshi Mahila Bachat Gat Federation—MDMBGF). The three enterprises operate as independent entities. But taken together, they offer financial products, services and policy initiatives that interlock with each other to de-risk clients and set them up for success.

100% of MDM’s clients are rural women with daily incomes of less than USD 1.5. More than 60% are traders and daily wage labourers. They live in the inaccessible, drought prone areas of Mahaswad in Maharashtra and North Karnataka.

The Innovation

In 1997, Mann Deshi Mahila Sahakari Bank (MDMSB) won a hard-fought battle with the Reserve Bank of India to become the country’s first rural cooperative bank. 500 illiterate, rural women mobilized shareholder capital of INR 600,000 to demonstrate that poor and asset-less women could launch their own financial institution.

In 10 years, MDMSB’s shareholder base has grown to 5963 with a total share capital of INR 10 million. 85% of MDM clients come from ‘priority’ or economically weak sectors. More than 45,000 customers and 4300 shareholders are members of backward castes. Together, they have grown the bank’s assets to INR 120 million. In 2006, MDMSB announced dividends for all shareholders. In March 2007, it posted net profits of INR 2,31,000 and reported a loan recovery rate of 97%. (All figures as of March 2007)

The Bank offers clients an integrated range of new and affordable financial security products: savings products, micro-pension funds, health and life insurance, and loans to increase the liquid assets of women. With doorstep agents, limited paperwork (a tenth of what other banks mandate), quick loan disbursals and 95% female staff recruited from rural Mahaswad, MDMSB has emerged as the bank of choice for rural women.

In 2006, MDM launched Udyogini, the country’s first rural business school with classes held in the bank branches. Udyogini also travels to the rural interiors through a bus fitted to meet state-of-the-art classroom requirements. The curriculum and faculty are led by rural women entrepreneurs.

MDM also provides rural women the citizenship entitlements and social networks that they need to run businesses and build assets. Through successful advocacy by Mann Vikas Samajik Sansthan (MVSS), more than 600,000 women in Maharashtra are now co-owners of household property. The MDM Bank has also launched schemes to encourage families to keep their daughters in school.

The Impact

Mann Deshi, advocating property rights for women. Photograph by Cyrill Ardin

Since 1997, MDM has directly reached 164,251 women and indirectly benefited 300,000 families. Its business development services has seeded and sustained 17,051 rural women entrepreneurs. In an impact study conducted in 2006, 100% of MDM’s clients reported an average 80% increase in daily income (with 50% reporting 100–200% increases in family income). 61% reported a substantial increase in meal quality. More than 60% reported substantial increase in their confidence levels for being able to navigate through the commercial banking sector. A combination of these factors has led to a 40% drop in migration in Mahaswad and a proportionate decrease in drop out rates of girls going to school. Mann Deshi Mahila Bank plans to move operations to six new states in the near future.

The Entrepreneur

“The women of Mann Deshi have aligned Lakshmi and Saraswati (the Goddesses of knowledge and wealth) to create dignified spaces for themselves in the banking business and the stock market.”

Chetna Gala Sinha

An economist, farmer and activist, Chetna Gala Sinha was born in Mumbai. In the 1970s she was active in the Jayprakash Narayan student movement through which she worked intensively with rural and marginalized communities. After her marriage to a farmer and rights activist in the Mahaswad area, she decided to pursue a career in farming. This was when Chetna experienced, firsthand, the challenges of ruralwomen—lack of access to financial services leading to debt. The design and development of the MDM idea has emerged organically from her personal life trajectories. Chetna was awarded the 2005 Janakidevi Bajaj Puruskar for rural entrepreneurs and was selected for the first class of Yale University’s World Fellows Program in 2002–03. In addition, she and Mann Deshi have received a clutch of awards like the Ashoka-Changemakers Social Innovations award.