Last week I suggested the value of financial plans alternative to modern banking systems in rural India. In Kutch, Gujarat, I saw men and women save and invest capital in items such as embroidery, jewelry and steel vessels rather than in rupees. I learned that systems of financial planning exist outside of banks and paper notes.
However, while alternative forms of saving and investing take place, I still think about the gaps barring women from secure financial planning within their boundaries.
When a woman invests in jewelry, how can she insure her investment? Can a woman plan to start a business on her own through such investments? Do transactions regarding her investments require a middleman to facilitate barters and sales, and could such a requirement inhibit her success or independence?
And she can trade her gold and silver for rupees to front her venture, but what if she lacks the resources to negotiate a fair price? What if a money lender asks her to sign a contract in a language that she cannot read? How can she analyze the risks of her investment if she lacks access to marketing and product development resources? How will she reach customers outside of her region if her mobility is restricted by cultural norms?
These questions spawn beyond the discussion of traditional banking systems’ worth in rural India. Ultimately, financial planning comes in all sorts of suits; it happens whether it is institutionalized by a bank or sprouted from a field of rice. But if there aren’t structures positioned towards empowering women in communities where women are economically marginalized, many financial systems can leave female entrepreneurs behind.
A model that seems to effectively fill gaps in savings and investment systems is the collective structure. Many microfinance organizations and craft enterprises employ the collective structure to position women to succeed financially. Because of its reliance on the collective structure, it seems that the model of microfinance proves its worth… even among populations that lack density.
The benefits of the collective structure are immeasurable. Whether the collective is a large cooperative or a small group, collectives can:
- Establish standards for fair wages and fair labor practices for its members
- Create links between business owners and domestic and/or international markets
- Encourage the exchange of ideas (design, marketing, efficiency of production) among members
- Provide safe working conditions for members
- Deliver members with access to raw materials
- Provide marketing and development guidance
Many collectives even provide loans, financial education, emergency funds, health care and opportunities to further basic education. Moreover, group structures encourage competition, which often pushes women to achieve more than they would if they were working alone. And as internet access becomes more widely accessible to people in rural areas, women are being trained to use it; the internet may offer another avenue of participation in collective structures, especially among populations that lack density.
The collective structure of Qasab, the organization I volunteered for in India, fosters the craftswomen’s success on several levels. Yes, the villages throughout Kutch are widely scattered throughout a vast dessert. But women throughout the villages are connected through the branches of Qasab’s network. Qasab’s higher-skilled craftswomen travel to the villages to give embroidery lessons and manage product quality. Qasab’s leaders provide raw materials, ensure fair wages, research market demands, and connect their products to markets and museums in Europe and North America. Qasab’s network further offers the women a sense of pride in the connection with outsiders who support them, and several of Qasab’s members have traveled internationally for exhibitions and workshops.
It’s important to recognize that many systems for saving and investing exist outside of traditional bank structures. However, women are often left out of these traditional systems, especially in rural areas. The collective structure can help level the playing field for women in business.