Given the highly unstable scenario that the public banking sector in India is currently grappling with, how often would you come across a co-operative bank that issues loans on trust alone and that too, to people from nomadic tribes, who are still viewed by the society with distrust and cynicism?
However, Ahmedabad’s Kalupur Co-operative Bank has been doing so for the past 12 years and has an estimated 600 of its 4,500 accounts dedicated to microfinancing members of the Vicharata and Vimukta Samuday (nomadic and de-notified) tribes of Gujarat.
This is believed to be the only independent bank in India that disburses loans to communities that don’t use months or dates, let alone the organised banking system. The co-operative bank has been financially empowering these communities since 2006 through loans of ₹50,000 to purchase houses under government schemes and ₹25,000 for expanding small-scale businesses at a rate of interest of 10 percent.
Most of the tribals in the region don’t have address proofs or any permanent addresses that they can pledge as collateral at a regular bank to avail a loan.
The Kalupur bank’s decision can be solely attributed to the trust established by the Vicharata Samuday Samarthan Manch an Ahmedabad-based organisation started by Mittal Patel, who has been working towards the welfare of the nomadic de-notified tribes for over a decade now.
VSSM’s social workers and bank officials work together not just to induct the community into the banking system but also help them with the payment of instalments by making deposits on their behalf on a monthly basis. The bank also has a mobile van unit that makes regular trips to rural areas to encourage the members to deposit any savings that they may have gathered into their bank accounts.
This began as a single-handed movement by Patel in 2004 to raise awareness amidst the nomadic communities about their voting rights and get them identity cards, which are imperative for public distribution schemes, reservations and welfare programmes. Today it is helping members become small-scale entrepreneurs by turning traditional practices into small businesses.
