1. Loan Journey:
A study on spending of loan amount and its repayment by
Informal Sector.
SUBMITTED BY:
Ashish Dhingra
SUBMITTED TO:
Ms Chhaya Bhavsar
Prof K.K. Krishnan
3. 5/29/2015 Summer Internship With Sewa 2015 3
Problem:
1
• Case studies of woman on how
she has spent the loan amount.
2
• Factors which are creating
problem for repayment.
3
• Is there any scope for new
saving products?
4. Methodology:
Primary Research : This was done through direct interviews of the
following respondents.
1. Individual Interview of ben.
2. Focus Group Discussion of ben.
3. Spirit team members.
4. Sewa bank employees.
5. Sewa office employees.
Secondary Research: It was collected through internal resources.
1. Sewa Annual report
2. Official records (Relation in quantity of land possessed and amount of
loan issued, loan granted and repayment)
3. Forms ( Bachat Mandal, Loan issue form)
4. Information from Website.
5/29/2015 Summer Internship With Sewa 2015 4
6. DATAANALYSIS
BODELI
• Fig 1: Explains Loan
Issued in each financial
year.
• Fig 2: Purpose of the
loan issued.
• Agriculture is
dominating.
5/29/2015 Summer Internship With Sewa 2015 6
0
10000000
20000000
30000000
40000000
2789700
68460008630000
11625000
15248000
24252500
26420000
33668000
Amount
Financial Year
Gross Loan Issue
0
10000000
20000000
30000000
Amount
Purpose wise loan Sanction
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
7. Anand
• Fig 1: Explains Loan Issue
in each financial year.
• Fig 2: Purpose of the
loan issued.
• Portfolio is much
diversified.
5/29/2015 Summer Internship With Sewa 2015 7
0
10000000
20000000
30000000
40000000
50000000
60000000
2009 2010 2011 2012 2013 2014 2015
13209325
28171932
35237590
37754249
52426548
58365811
28310236
Amount
Year
Gross Loan Issued
0
5000000
10000000
15000000
20000000
Purpose wise loan Issued
8. Spending Of Loan:
• Agriculture:
5/29/2015 Summer Internship With Sewa 2015 8
Rs.3000-5000 Rs. 5000-15000 Rs. 15000-25000
Seeds Seeds Water
Water Pesticides Fertilizer
Fertilizers Fertilizer Seeds
Pesticides
Labor
Machine
Tractor
Transportation to
Market
9. Mortgage
Bodeli:
1. Land Release
2. Rickshaw Release
Nandasn:
1. Land Release
2. Debt Repayment
Anand:
1. Land Release
2. Shop Release
3. House Release
4. Jewelry Release
5/29/2015 Summer Internship With Sewa 2015 9
Mortgage
Land Release
Rickshaw
Release
Jewelry Release
Shop Release
House Release
Debt Repayment
10. Business:
Bodeli
1. Basic Need Fulfill.
Nandasan
1. Basic need fulfill.
2. Growing Stage.
3. Expanding Business.
Anand:
1. Basic Need fulfill.
2. Growing Stage.
5/29/2015 Summer Internship With Sewa 2015 10
• Basic Need FulfillRs.5000-20000
• Growing StageRs.20000-50000
• Expanding BusinessRs.50000-70000
11. Household:
• If loan amount: 8000-15000 Only
1st fig: Applicable.
• If Loan amount 15000-30000:
Both figures are applicable.
5/29/2015 Summer Internship With Sewa 2015 11
House
loan
Bricks
Cement
Pipes
Iron
Room
Toilet
build
House
loan
Electric
work
Room
KitchenPlaster
Paint
Fig: 1
Fig: 2
12. Education:
Bodeli
1. College fee.
2. Hostel Fee
Nandasan:
1. College Fee Case.
Anand:
1. School Fee.
2. College Fee.
Source: Rest all options are way
of spending both in School
fee and College fee.
5/29/2015 Summer Internship With Sewa 2015 12
Education
Loan
College fee
Books
School
Bags
StationarySchool Dress
Hostel fee
School Fee
13. Animal:
• Bodeli
1. Buffalo
• Nandasan
1. Every Case was seen.
• Anand
1. Every Case was seen.
5/29/2015 Summer Internship With Sewa 2015 13
Animal
loan
Buffalo
Cow
GoatFodder
Doctor
Fee
14. Repayment: Bodeli
• In gross repayment include
outstanding amount with
interest.
• Delayed loan percentage
driven from outstanding
amount of loan with
interest.
5/29/2015 Summer Internship With Sewa 2015 14
0
10000000
20000000
30000000
3060900
7693317
9768184
12156464
17178401
26435077
28148013
20569325
Amount
Financial Year
Gross Repayment
0
10
20
30
40
50
1.72 0.61 0.61 0 1.01 2.08 3.42
47.8
Percentage
Financial Year
Delayed Percentage
15. Repayment: Anand
• Repayment: A reason to
worry.
• Figures of delayed loan
amount are astonishing.
Source: Figure including
outstanding amount.
5/29/2015 Summer Internship With Sewa 2015 15
0
10000000
20000000
30000000
40000000
50000000
2009 2010 2011 2012 2013 2014 2015
11045053
24447975
28464888
33194541
14567965
45902341
19647709
Amount
Year
Gross Loan Repayment
0
20
40
60
80
2009 2010 2011 2012 2013 2014 2015
16.3844254
13.21867808
19.22010557
12.07733731
72.21261831
21.35405949
30.59856866
Percetage
Year
Percentage delayed repayment
16. Case: Bodeli
• Name: Savita Ben Raman Bhai Rathva
• Village: Watada
• No of loans: 6 (Agriculture)
• Education: Illiterate
Problems: Water for irrigation.
No other source of income.
Problem of loan repayment.
Major Spending: Seeds.
Fertilizers.
Water on rent.
Processing.
Labor.
5/29/2015 Summer Internship With Sewa 2015 16
17. Loan Granted:
• Loan Pattern was really good.
• When she come to know she is facing
problem of loan repayment, she took less
loan (2013).
• But she is facing a big problem of water
required for irrigation
Spending:
• Her main part of loan was spent on three
things
Seeds, Fertilizer and Water.
• Aged.
• Machine usage.
5/29/2015 Summer Internship With Sewa 2015 17
0
2000
4000
6000
8000
10000
12000
2009 2010 2011 2012 2013 2014
9000
8000
10000
12000
7000
12000
Amount
Year
Loan Amount
19%
10%
19%
12%
15%
10%
15%
Spending Water
Processing
Seeds
Mazdoori
Fertilizer
Machine usage
Tractor
18. Bodeli
• Name: Varsha ben Alpesh Bhai Rathwa
• Village: Anyadri
• No of loans: 3 (Agriculture)
• Education: 8th
Problems: In actual it was not found.
She is an example for everyone.
Major Spending: Seeds.
Fertilizers.
Pesticides.
5/29/2015 Summer Internship With Sewa 2015 18
19. Analysis:
Loan Granted:
• Loans were granted less but she
used this loan amount efficiently.
• She knows where to spend and
how much.
Spending:
• Education makes a whole change
in spending.
• She has spent loan amount on 8
things.
• Which shows she is known to
products available in market and
how much they cost.
5/29/2015 Summer Internship With Sewa 2015 19
0
1000
2000
3000
4000
5000
2008 2009 2010
3000
4000
5000
Amount
Year
Loan taken
24%
16%
8%8%
8%
16%
8% 12%
Spending of loan
Seed
Pesticides
Water on rent
Machine on rent
Labour charges
Fertilizers
Tractor
Transportation charges to market
20. Nandasan
• Name: Noor Mohammed Ghanchi Rao
• Village: Kadi
• No of loans: 5 (Business)
• Education: 5th
Problems: Child Health condition.
Husband’s static Income.
3 Daughters Study and
Wedding
Major Spending: Stitching.
Sari.
Katlari, Cosmetic.
5/29/2015 Summer Internship With Sewa 2015 20
“Lady with Luck”
21. Analysis:
Loan Granted:
• Her loans were increased
gradually. This shows her credit
worthiness is good.
Spending:
• Most of her spending were on
buying material, which further she
sell and earn.
Income:
• Her family income has increased
very much. Has a change of 300%.
5/29/2015 Summer Internship With Sewa 2015 21
0
20000
40000
60000
80000
2005 2006 2009 2011 2013
5000
15000
30000
50000
70000
Amount
Year
Loan Amount
61%
24%
15%
Spending of loans 2006 to 2013
Sari Buying
Cosmetics
Katlari
Before Joining After Joining
5000
20000
Income (Monthly)
22. Scope:
• Taking a loan and spending that amount is major concern in Informal
sector.
• This project will clear the factors on which amount has been spent,
whether the granted loan was sufficient or Sewa need to extend their base
for loans.
• This project will also clear the base of loan granting so it will improve their
loan repayment cycle and the future of new saving schemes.
• Village wise analysis on which mode of repayment will be suitable for
them.
• Relation of education to spending of loan amount.
• Suitable base for loan grant, so that repayment problem will be solved to
some extent.
• Last but not least case studies on life of Individual.
5/29/2015 Summer Internship With Sewa 2015 22
23. FINDINGS/OBSERVATIONS
• Starting with loan form which they have, is not sufficient to have full
information from the proposer.
• Most of the loan forms are incomplete.
• There is no base for the how much loan should be granted to an individual
woman.
• All the work done is manual, means till now there is no IT base in Bodeli.
• Meetings were conducted on every Saturday to plan next week plan. That
is good initiative.
• One of the biggest problem is Water required for irrigation.
• Due to easy process, no much documents required and difference in
interest rate. Member prefer to take loan for Agriculture purpose.
5/29/2015 Summer Internship With Sewa 2015 23
24. Few More:
• Bens are hiding the actual fact.
• Due to the SEWA bank their loan recovery problem is very less
and they proper investigation before and after providing loan.
• Education level is good in Nandasan and through they know
how to spent and where to spent.
• Due to industries also, Nandasan is not facing a problem of
loan repayment and this is the other sources of earning.
• Documents are filled properly.
• In Anand only Education level is very low among leaders of
Bachat Mandal
• Information only given to leaders not only all group members.
5/29/2015 Summer Internship With Sewa 2015 24
25. RECOMMENDATION
• Changes in Loan Form.
• Set another base for loan. Based on Income and Land Possessed
• Ask for spending bills.
• Diversification in loan Portfolio.
• Where earning level is good prompt them for new saving schemes.
• Design repayment installments on the basis of earning level of
villages.(Watada, Bhatiyapur)
• Provide information directly to members not only to leaders.
• Explore more subsidies available from govt.
• Analysis of villages need to be done for spending and repayment.
• Excessive issuance of loan amount creates problem in loan
repayment and spending.
5/29/2015 Summer Internship With Sewa 2015 25
26. LIMITATIONS
• The focus group and interviews were affected by my lack of knowledge of
Gujarati as members were not able to speak Hindi.
• Even though we had one SEWA member all the time she used to translate
Gujarati in to Hindi. In that translation we might have missed some things.
• Many people used to feel shy about talking about their income and
savings or how much loan they have taken.
• Fear in women that “who are we?”. Members used to say we are from
Delhi for recovery.
• Many people hide the things.
• Due to marriage season unavailability of women In villages.
• We have not presented any data on nandasan because of unavailability.
• Small sample size to explore specific results.
5/29/2015 Summer Internship With Sewa 2015 26
