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SEWA BANK

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SEWA

Self Employed Womens Association

Promoter : Mrs. Elaben Bhatt

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Started in : 1972 (with 4000 members

registered as SEWA bank in 1974)

Share capital: starting time : Rs. 40,000/-(Registration)

Membership : more than 9,00,000 in the

country

Savings of members: over Rs. 70 crores

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Turning point:

Small Co-operative Bank to a multi-service

organization providing integrated set ofservices.

It is an NGO with multi-activities.

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Ms. Jayshreeben Vyas

Managing Director

SEWA Bank.You can see Case Study on SEWA Bank

in Handbook on Management Cases; by

B.S. Sahay, Tojo Thatchenkery and G.D.Sardana.

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SEWA is an organization of women (trade

union for organizing self-employed

women) workers in the informal sector 96% women workers are in India in

SEWA.

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Initial members occupation

Vegetable vendor

Home based workers

Construction workers Head-loaders

Laborers

Rag-pickers

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These workers were not getting a regular

salary/ employment with welfare benefits

like other workers in the organized sector.

These workers were contributing in a big

way to the nations economy, but they

were invisible & inaudible.

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Position of Members

a. Work for 18 hrs. on an average basis

b. Lived in extremely poor condition

c. Earning not more than Rs.50 to 100 perday

d. Position: continuous exploitation by

middleman or moneylenders

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Two common problems faced by these

women were:

1. High interest rates to be paid to moneylenders, &

2. Lack of assets (No assets)

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Q. What was the need of these women?

Ans. These women needed CREDIT

Initial try: SEWA arranged loans fromlocal banks but due to :--

a. illiteracy

b. poor socio-economic status of womenwas not acceptable to banks.

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In one Meeting of SEWA in 1973 gave one idea-

WHY NOT START A NEW BANK ESPECIALLY

FOR THEM .

Women leaders had collected Rs. 10/- each

from 4000 members for 6 months & created a

corpus fund

(10x4000=40,000x6=2,40,000) Amount was sufficient to start a Bank & get

Registration.

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HURDLES

Several hurdles came in the way but

Shri Mahila Sewa cooperative bank was

registered as a Cooperative Bank in May1974

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Two controlling authority:

1. RBI (As Regulatory Authority)

2. State Govt. (As Registering Authority)

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Mission of SEWA bank

SEWA bank exists to reach to maximum

number of poor women workers engaged

in un-organized sector & provide them

suitable financial services for their socio-

economic empowerment & self-

development, through their own

management & ownership.

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Main objective of SEWA bank

Bringing poor self-employed women out of

the vicious circle of poverty (out of the

clutches of money lenders)

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SEWA Bank applied the approach:

a) Freedom from debt :

(by providing loan at Lower rate of interesti.e. about 12%)

b) Capital formation:

( To inculcate habit of saving to formCapital)

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Objectives of SEWA bank

1. Providing facilities for savings & FD.

2. Providing credit for productive , economic &income generating activities to self-employed& the poor.

3. Extending technical & management assistancein:

a. Production

b. Storage

c. Procuringd. Designing

e. Sale of goods & services

f. Buying raw materials , equipments tools

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4. Establishing direct links with industries,

wholesalers & producers.

5. Guidance in marketing of their goods.6. Accounting services to members

individually & to womens groups.

7. Helping in maintenance of properaccounts of their business/activity.

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Providing facilities to rescue their

Jewellery from Brokers (Lenders) and

private money-lenders and giving loans

against Jewellery.

Adopting procedures and designing

Schemes suitable to poor Self-employed

Women, like collecting daily Savings fromtheir place of business/work, or houses.

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Providing Saving Boxes and giving

Training and assistance in understanding

Banking procedures.

Providing Financial Literacy Services

which include Financial Planning,

Retirement Planning etc.

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BUSINESS MODEL

1.SEWA Bank works as other Bank with adifference.

2.The difference is that In the SEWA Bankthe Bank has to go to the Customer(Whereas, in other Banks, the customercomes to the Bank).

3.Account holders of SEWA Bank are 80%Urban Self Employed women and 20%from Rural Self Employed women.

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4.Urban depositors are : Vendors

Laborers or small service providers.

Home-based workers.

Average monthly income is Rs.1500 to 3000 per

family.

Depositors are from THREE sources :-

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(i) Through SEWA Organizers who work in

the field and are in personal contact with

self employed women.

(ii) Through existing members of SEWA and

SEWA Bank.

(iii) Through word of mouth (when people

say to each other- Individual publicity.).

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SEWA BANKs Head-office:Ahmedabad.

There are THREE Branches havingmembers over 4.00 Lacs.

OTHER FACILITIES OF SEWA BANK:

(1)Regular meetings of members where theyshare experiences with each other.

(2)SEWA is set-up in the form of a CooperativeSociety each member gets the right to votewhen she joins the Bank.

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(3) Members elect Board of 15 members.

(4) If the Bank earn profit, it distributes dividendamong its members.

(5) SEWA Bank started Banking activities inRural Gujarat in 1997 (with permission ofRBI)

SEWA Bank follows the Associationbased Model (Like AMUL) i.e. VillageMilk Cooperative Society.

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Head Office in Ahmedabad.

District Associations in SIX districts:

1. Sambarkanta2. Vadodara

3. Ahmedabad

4. Anand

5. Mehsana

6. Gandhinagar.

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Every District has one Group-Leader who

is having 3-5 years experience known as

Spearhead (i.e. Commission Agent and

not an Employee).

One District Group-Leader has under him

35 to 40 SHGs (each having 15 to 20

Women) per Taluka/Block or village.

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Structure of Bank Branch

Branch Manager

|

Functional Departments

|

Counters

|

Helping Hands

|

Bank Sathi

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Governance

Structure

Members

(self employed)

Directors elect Chair person,vice-chair person

(out of total 15-12 are elected ,

2 nominated by women organization

1 paid MD)

Appoint

MD

Gen Manager

Elect

Manager

Staff

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Deposits : Sewa has many deposit schemes.

Loans: Internal lending (interest is 24%)

Association loans (6 %to group+18%to Association)

Individual loans (24%) = 3% to group,6%toassociation,15% to SEWA bank)

Interest is 20%(Scheme under experiment):

Experiment basis: 1% goes to group

1% goes to the agent18% goes to the bank

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Deposit scheme

1. Recurring deposit for : Rs50/-p.m.in 1styr.

(Riddhi Siddhi Yojna) Rs.100/-pm in2nd yr

Rs.150/-pm in 3rd

yrRs. 200/- pm in 4th yr

Rs.250/- pm in 5th yr

Returns: After 5 yrs Rs.10,169

After 10 yrs.Rs.15,110

After 15 yrs. Rs.22,452

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2. Ghar fund yojna (house fund scheme)

deposit Rs.250/- , Rs.500/- or Rs.750/-

monthly for a period of 5 years or more Pay regular installments for 5 yrs & participate

in a lucky draw

Build own house after 5 years with the amount

received

Client may get some loan from bank, if

required

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INVESTMENT SCHEMES:

Rs. 250 p.m. Rs.500 p.m. Rs.750 pm

Return after 5 yrs.

Rs.18,466 Rs.36,932 Rs.55,398Return after 10 yrs.

Rs.45,906 Rs.91,811 Rs.1,37,716

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MANGAL PRASANG YOJNA:

Special occasion Scheme:

Rs.200/- p.m. for 5 years Plus(+)

Lucky Draw yearly basis (gets lump-sumamount under draw)

Rs.200/- p.m. after 5 years becomes

Rs.14,773/-

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CHINTA NIWARAN YOJNA :

1. Rs.40/-p.m. for 5 years

becomes Rs.2955.

2. Rs.80/- p.m. for 5 yearsbecomes Rs.5910.

3. Rs.120/-p.m. for 5 years

becomes Rs.8865.

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SWAPNA SIDDHI YOJNA :

Fixed Deposit for 3,5,7,10 years.

Rs. 500/- after 5 years becomes Rs.743/-

Rs.500/- after 10 years becomes Rs.1104/-

Compound interest is given in this scheme

Interest is calculated on quarterly basis.

Interest on Rs.1000 @ 12% per annum will be

Rs.120 with simple interest and Rs.126 withcompound Interest for one year.

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RECURRING GOLD YOJNA:

Recurring deposit of Rs.50/-per month willbe Rs. 620 after 1 year.

Like-wise Rs.50/-p.m.

After 2 years Rs.1275/-



After 10 years Rs.9060/-Thus, small savings becomes big amount for

poor people who can buy some GOLD also.

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INSURANCE SCHEMES

Member's Insurance( Started in 1992)

There are three different Schemes:-

SCHEME NO. I :

Annual premium Rs.75 FD Rs.700

Natural Death Rs.3000/-Accidental Death Rs.40,000/-

Accidental Death of Husband Rs. 15,000/-

Hospitalization up to Rs.1300

House & Asset Insurance up to Rs.5000/-

Against Fire, Flood, Natural calamities.

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Husbands Insurance

Annual Premium Rs.45/- & FD Rs.450

Natural Death Rs.3000

Accidental Death Rs.25,000/-

Hospitalization Up to Rs.1300/-

Total Risk Covered for

Member and her Husband Rs.120 (as premium)

FD Rs.1150

(Rs. 700 +450= 1150)

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Scheme II

Annual Premium Rs.180

FD Rs.1800

Natural Death Rs.5000/-

Accidental Death Rs.40,000/- Accidental Death ofHusband Rs.15000/-

Hospitalization Rs.4500/-

House & Assets insurance Rs.10,000/-

Likewise there are other Schemes, Scheme IIIand Scheme IV with more premium and otherbenefits.

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IMPORTANAT DATA OF SEWA

BANK AS ON 31-3-2008

1. No. of Deposit Accounts: 2.50 Lacs.

2. Total Deposit of Bank 70.00 Crores

3. Total No. of Loan A/cs >1.00 Lacs

4. Amount of Loans >30.00 Crores

5. No. of Shareholders >60,000

6. Amount of Share Capital >3.50 Crores

7. Total Working Capital >100 Crores

8. Net Profit (Decreasing) >50 Lacs

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OTHER IMPORTANT FEATURES

OF SEWA BANK :

1. Pension Scheme 2006 :Bank introduced

Indias first Micro-pension Scheme in association

with Unit Trust of India Asset Management

Company.2. SEWA Bank collects individual contributions and

sends them to UTI on a monthly basis.

3. UTI have opened individual retirement accounts

from which cash is invested in Debt and Equity

by UTI.

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3. Energy Product :- SEWA bank initiated

Project Urja in 2006 with SELCO, the

technological partner that designs solar

and bio-gas cooking/ lighting devices.The users of this gas/light are :

(a) Mahila Housing Trust.

(b) Sewa Bank.

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Use of solar and bio-gas Urja:

1.Smokeless stove by members.

2.Solar Lantern for vendors and midwives.

3.Solar lights4.Portable solar cookers and

5.Bio-gas

To improve the living standards of Sewamembers (more than 3 lac members)

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4.Financial and Business Counselling.

5.Information Technology : Sewa Bank uses

I-flex software for its Core Banking as isused by any other commercial Bank.

Sewa has its ATMs at Head-office at

Ashram Road. It works in Hindi, English

and Gujarati language. MIS reports are

prepared reg. Loans, Deposits etc.

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6.SEWA Bank is working on the Mobile Bank

branchin the city and hand-held device for

Bank Sathi working in the Branches.

7.SEWA Bank has adopted marketing of itsproducts and services on a Marketing Vehicle

i.e. a Mobile Van with a 29 colour TV, CD and

Cassette player, generator and posters. The Van

covers over 200 areas and covers around 6000women. It makes publicity and makes aware

the common people in chawls, and slums.

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8. Human Resource Management : Totalstrength of staff is 120. Bank recruitsonly women for most of its positions.

Proper Training is imparted by SEWAbank.

9. Others who are associated with SEWAare Agents and Group Workers who getscommission on deposits and otherworks.

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10. Collaborations and Alliances : SEWA has

collaborations with National and International

Organizations in its developmental activities.

Some of them are :(a) Coady International Institute, Canada.

(b) Indian School of Microfinance for Women,

Ahmedabad, India.

(c) Womens World Banking, New York, USA.(d) Friends of Womens World Banking, Ahmedabad,

India. ********

sewa+bank

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