Global Observer

Microfinance turns Bihar prostitutes into businesswomen

Microfinance turns Bihar prostitutes into businesswomen

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BIHAR -- How a bank loan could end generations of prostitution in an Indian town.

Julie Khatoon sitting in her bangles shop.

BIHAR -- Meena Devi’s grandmother was brought from Varanasi city in Uttar Pradesh and sold in the red light area of Munger, a town on the banks of the Ganges in Bihar.

Meena’s mother also became a prostitute and so did she. “We have done this for generations so I wanted to set my daughters free from this line,” she said.

In 2011, Meena, 35, was one of eight prostitutes who approached the local rural bank, Bihar Kshetriya Gramin Bank, for a loan to start a business. In an unprecedented move by the bank, the women were given a microfinance loan of Rs. 20,000 ($377) each. Four women opened a bangles shop and the four others started a tailoring service.

“No government scheme or bank has touched these women,” said Mohammad Mahfooz Alam from Panah Ashram, a local NGO that educates children of prostitutes in the red light area. “But they showed initiative and things changed.”

Arvind Chaudhary, who oversees microfinance for the rural bank, recalls that he was passing the Panah Ashram school when these women approached him for the loan. “For the first time, I entered the building and saw that these prostitutes were teaching too,” he said. “I was moved and wanted to help.”

It’s been difficult to extend such loans to these women as they do not have collateral and nobody stands as guarantors for them. In 2010, the National Bank for Agriculture and Rural Development (NABARD) extended its Joint Liability Group (JLG) loans to the non-farm sectors as well.

Under the JLG plan, a group of four to ten people taking a loan to start a similar activity accept liability for each other. The eight women were extended a loan under this scheme. The rural bank, satisfied with the women’s performance, extended the credit limit to Rs.50,000 ($943) for each member in April last year.

“We are unable to tap the normal population for bank finance … on the other hand those prostitutes who tried alternative livelihood have been financed,” said Sheetanshu Shekhar, a senior official at NABARD in Munger. “Nobody would have imagined.”

Doing business, however, has not been easy. The bangles group, which has expanded into selling shoes as well, is coping better than the tailoring group. The bangles group has a turnover of about 15,000 ($283) rupees a month, which they distribute among themselves and put some toward repaying the loan. The stitching group is left with only 5,000 to 6,000 rupees a month.

The women explain that bangles and shoes are fashionable items purchased by people regularly. Clothes are bought less frequently. Bank officials have tried to help them by encouraging shopkeepers to give these women orders to make petticoats, hem in the sari borders and make repairs.

Another hurdle, faced by the tailoring group, is that the locals prefer to take their business to male tailors who are more respected in the profession. “They have shops on the main road,” said Sweta Devi, 29, from the tailoring group. “People expect us women to stitch for some Rs. 50.”

Alam, who connected the women and the rural bank, is waiting to see how the two business ventures progress before encouraging more prostitutes to take microfinance loans.

Most of the approximately 200 prostitutes in Munger are from other parts of the country. They belong to the Nat caste, regarded to be at the bottom of the social hierarchy, who mostly sing and dance in the town and bordering villages. They all try to keep their lives hidden from the community back home.

Geeta Devi, 47, who is in the tailoring group, was forced into prostitution after she finished the 10th grade in a government school in Varanasi. “My mother didn’t get me married because I was needed to earn money after turning 18,” she said.

Geeta recalled that she wanted to become a nurse but her mother wouldn’t give the 30 rupees needed to travel and get the training in Fatehpur Sikri, another city in Uttar Pradesh.

The red light area of Munger town.

Ironically, the landmark for the red light area here is a structure representing the Ashok Stambh, a pillar of four lions, which is also the national symbol. The pillar stands in a crowded market called Shravan Bazar, named after a mythological character epitomizing parental devotion in the Ramayana epic.

As dusk falls, women with painted faces stand outside grimy doors that conceal dingy dancing chambers. The tawaif community is one without husbands or fathers. “Our identity comes from our mothers,” said Julie Khatoon, 29, who became a dancer at age 16 and is now part of the bangles group.

Still, the businesswomen matter-of-factly admit that prostitution was more lucrative than their new ventures. “One man will give Rs. 1,000 for an hour and now for Rs. 1,000 rupees we are breaking our eyes for 10 hours,” said Sweta.

But the new work has brought them peace of mind. “There is no fear of the police or people who come and hit us and don’t pay,” she added. “We are at least free from the money of shame.”

While the women claim to be out of prostitution, Alam paints a murkier reality. “They want to live well so they have only left it partially,” he said. “But their children will be out of it.”

To ensure that her 18-year-old girl did not become a prostitute, Meena got her married after school and sent her back to Varanasi. “My new work has given me respectability,” she said. “So there was a celebration and we gave a good dowry like everyone else.”

And Khatoon, originally from Bharatpur in the state of Rajasthan, is sending all her three daughters to the local government school as well as getting them tuition lessons for Rs. 600 a month.

Beside their business work, some of the women earn Rs. 3,000 a month by teaching small children in a school run by the Bal Mahila Kalyan, a non-governmental organization that works to empower women economically in the backward areas of Bihar. They have also been able to cut down on rent by setting up both the tailoring service and bangles shop in their own homes.

The tailoring group, however, is now thinking of a more profitable venture. They want to start a service of renting mini-trucks to carry agricultural produce and fruits from the neighboring villages into town.

The women say that business is increasing in the town because the roads and safety has gradually improved over the past few years. For the new venture, they want a bigger loan of Rs. 1,00,000 ($1,887) each to buy vehicles and hire drivers. The limit for microfinance is Rs.50,000.

“We have big dreams now. Let’s see what the future brings,” said Meena.

Photo credit: Betwa Sharma

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Betwa Sharma

Correspondent

Betwa Sharma has written for the Christian Science Monitor, Time, Foreign Policy, The New Republic, The Daily Beast, AOL News, GlobalPost, The Huffington Post, Columbia Journalism Review, The Times of India, Hindustan Times, Indian Express and The Tribune. She previously worked as the United Nations/New York correspondent for the Press Trust of India, the country's largest newswire. She holds degrees from the National Law Institute University in India, Cambridge University and the Columbia University Graduate School of Journalism. She is based in Delhi, India. Follow her on Twitter. Disclosure