Thrift and Credit Societies

Thrift and Credit (TC) Societies enable communities to design and manage mutual financial services helping them to become more self-reliant. For communities vulnerable to HIV, they provide an opportunity for marginalized groups to lead and influence their larger community.

TCs are cooperatives in which members regularly deposit a fixed amount of savings with compounded interest (decided by the community members), which then becomes available to the members as loans with easy repayment schedules. A management team from the community is elected to record each member's savings, credit, and the amounts accumulated. Such loans are taken for children's education, marriages of their siblings/children, household repairs, and other necessities.

Siaap’s TC program started in 2000 when it was observed that the MSM and women selling sex Siaap was working with were not saving their earnings and didn’t know how to keep accounts. Initially, groups were formed around the sangams (community-owned-and-managed organizations Siaap supports), focusing on the agenda of economically empowering the community and reducing their exploitation by the local moneylenders. But the success was limited since the TC members were scattered.  (For want of anonymity, normally women in sex work and MSM do not work in the same place they reside). The recovery from both women and MSM who borrowed posed a greater challenge.

After consultations, site visits to successful TCs in Andhra Pradesh, and community discussions, the WSS (women selling sex) and MSM decided to expand their membership by moving their TCs out of the sangams and into the neighborhoods, promoting neighborhood thrift and looking to mainstream their community.  WSS have noticed that after bringing their TCs into their neighorhoods and expanding their membership, they've gained the respect of their neighborhood’s residents.

The Thrift and Credit Societies are doing well today largely because of the democratic set up for decision-making, where the members have ownership over their decision-making processes and elections occur annually.

Accounts training for TC members has led to transparency and trust among them, and periodic trainings run by Siaap have helped develop the TCs further.

In providing technical assistance to the TCs, Siaap conducts monthly visits , offers support to TC leaders (both emotional and skills-based), mediates situations arising within a TC, and encourages transparency of accounts among TC members.

Some positive outcomes of the TC program:

• The TCs have enabled the women to be much more confident, as can be seen in the way they express themselves and negotiate decisions with their families and local and religious leaders.
• Because of access to capital, members have taken up small businesses of their own.
• Women have funded their children's education.  Prior to the TCs, they were afraid to borrow money from outside moneylenders for such purposes.
• Members develop new ideas and ventures together.
• Before the TCs, members borrowed from moneylenders at exorbitant interest rates.  Now, borrowing from moneylenders has virtually vanished. And because the neighborhood sees how low the TCs keep their interest rates, they have successfully negotiated with moneylenders to lower their rates.
• Among the 100+ members of any given TC, there is bonding among the families.  They care about and help each other in financial and non-financial problems.
• Initially, meetings were held under a streetlight at night.  Now, they negotiate actual rooms to rent for meetings.
• The success of the TCs accumulating savings has garnered much respect for the members from their villages.
• TCs do their own bookkeeping.
• At the start of the TC program, members didn’t want to run the groups for more than 5 or 10 years. They weren't thinking long term.  Now, they envision keeping the TCs running in perpetuity.