Learnings from the field

October 27, 2010
By Rang De Team
By Aishwarya Mishra, Rang De Hyderabad Chapter

On a bright sunny afternoon we reached Yemmiganur, a bustling town at a distance of 70 kms from Kurnool. Our team consisted of 9 Rang De Chapter Members and after a mostly comfortable 5 hour ride all of us were raring to start the borrower evaluations. We had planned to split ourselves into two teams and planned to cover as many borrowers as we could. Now we moved away from the bustling town to the narrow and unpaved bylanes which were in urgent need to repair dueo the rains. Proceeding with this plan, three of us started of by talking with Mehboob Bee. Mehboob is in the mud-bricks business. She has 4 kids — three girls and one boy — the youngest. She was happy with the loan given to her but, given a choice, she would like to have another loan and of a greater amount. She was very confident of being able to repay it. Her business was weather dependent — during rains she had to shut shop. Our conversation with Meboob Bee set the tone for the next few hours that we would spend in Yemmiganur. We came across a lot of similarities; which I would put down at the end of this post.

While this discussion was being done by Raghav, Hansika and Ipshita, another team comprising Rashmi, Nagender and Piyush was talking with B Narsamma. She is a vegetable vendor and wanted to improve her prospects by taking a loan to buy a license to set up shop inside the vegetable market. At Narsamma’s place we learnt that there are local saving schemes in which people saved money on a daily basis. She was able to save close to 50 Rs per day.

After trying this approach in these first set of discussions, we had to resort to Plan B. Apparently, none of us, barring Raghav, was well versed with Telegu and it seemed Telegu was required to ensure that we get an unbiased and uninfluenced response from the borrower. In light of this fact and duly acknowledging the fact that the borrowers were not too comfortable with a large crowd around them, we decided to change our plans. Raghav, our official photographer and translator, would be part of every evaluation. Two more people would join in to interact with the borrower.

During the course of next few hours, we met nine more borrowers. They were involved in activities like restaurant, weaving, contractor, sweet making, tailoring. Coming to the pattern that I had mentioned at the start of this post

  1. Kids — We observed that the desire for a male child resulted in parents continuing to have children unless they got a boy. However, I am not sure what it takes to tell people who are too busy earning their living that a girl is as desirable as a boy and that the more kids they have, the more precarious their financial situation would be.
  2. More loans — Almost everyone said they wanted loans of higher amounts and they seemed quite confident of being able to repay it back. When I think about it now, I am reminded of the recent controversy surrounding micro-finance institutions (MFIs) in Andhra Pradesh. In my discussions with Ram (Rang De Team), I came to know that at many places, people had loans from 5 to 10 lenders. These MFIs in their effort to further their cause, had not thought it important to do their due diligence. This resulted in something similar to the bubble in US, except that in this case people actually lost lives.
  3. Men and women — In more than one cases, the women was part of the effort only because she was part of a SHG and hence the only one eligible to take a loan. The business was driven by the man of the house and the women complied with what they thought best.
  4. Schools- Hearteningly, most of the kids who were supposed to be going to school were in fact going to school. That was a positive aspect. However, on the flip side, the parents did not really have dreams for their children. They were sending the kids to school because they knew school is important but they were yet to be acquainted with the power of education.

As a group, we too learnt quite a few things. We realised that a fair amount of homework before embarking on a field trip improves the quality of the outcome. We also realised that many borrowers found the application form a bit too tedious. We have taken this feedback to improve our processes at Rang De. The trip was one full of learnings for all of us in the group and we hope to go on more of these.

Rang De is transitioning from a charitable trust to a Non Banking Financial Company. Check out our brand new peer-to-peer lending platform rangde.in

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