Learn how the World Bank Group is helping countries with COVID-19 (coronavirus). Find Out


Women's Action Against Poverty

September 28, 2010

Acrid smell is floating out of large boxes in the terrace of the house of Siti Ria (43) located on the Riung coast, Ngada, East Nusat Tenggara. The boxes contain a big mass of salted fish as if it were crowded in small and stuffy rooms.

The great bulk of salted fish was shortly “parked” in the terrace. A few days later, Ria and her six friends peddled the merchandise in some places from village to village.

When other villagers were sleeping soundly, at 2:00 a.m., these women rode an open truck to the market to sell fish. This time, they targeted Manggarai, Soa and Riung markets.

“At 6:00 a.m. we arrive at the market to sell fish. We buy 1 kilogram at Rp 15,000 and sell it at Rp 16,000. We make a small profit because we have to compete stiffly at the market. Our supply depends on our capital. If we have Rp 50 million, we may buy 4-5 tons. We should not only provide one type of fish but many,” Siti Ria related her activities.

They often have to stay the night at the market. “In that case, men have to take care of children and prepare food at home. Women are going out on business,” said Rosmawati (39) also selling fish.

At first, only Siti Ria sold salted fish and it was just a small business. Her capital was small and prices would go down if she could buy a large supply of fish.

Soon after she heard of a Women Savings and Loan Program under the main umbrella of the Rural National Program for Community Empowerment (PNPM) in 2007, Siti Ria and her friends set up a joint business: fish trader and savings-loan group under the name of Kelompok Wisata Bahari. This group received its first loan of Rp 10 million and could pay it off. Now, it manages its third loan of Rp 50 million.

There is a division of labor among them: leader, secretary, treasurer, marketer and PR officer. “Together, we can pool our money to make a larger profit,” said Siti appointed to be the group leader.

In another village, the distant sound of weaving looms is heard. Behind the simple looms full of colorful threads some female villagers are sitting.

Originally, weaving works were done individually and financial capital was always the problem. The price of a good-quality thread may be hundreds of thousands of rupiah. But now, since there has been a Women Savings and Loan Program, capital is no more the main problem for them.

Like the Kelompok Wisata Bahari composed of women on the Riung coast, Kelompok Usaha Bersama Satu in the Benteng Tengah Village also receives funds from the Women Savings and Loan Program to run the joint weaving business.

Flora Pena (44), Leader of the Kelompok Usaha Bersama Satu, said that they have received four loans. “In 2010, we received Rp 20 million. The money has been used to produce woven cloth. The burden is too heavy to produce it individually because of the high prices of threads,” she said.

Flora and her group members who are housewives never imagined they would receive a loan to develop a business. “It would be impossible for us to get a bank loan because our husbands are just farmhands and we have nothing to offer as collateral. We also do not dare to take out loans from usurers because of their high interest rates,” said Flora.

It is also difficult to imagine that we have managed our own business to make income. The proceeds of woven cloth sales are partly retained in the group treasury and the rest are shared among them. “The resulting money is usually used to meet household needs,” said Flora.

Kolompok Wisata Bahari members are also housewives and had never sold salted fish before except Siti Ria. Rosmawati said that their husbands who are furniture craftsmen, livestock traders, teachers and fishermen have no objection to their wives’ business. The money they make will help their families’ income.

“We can afford to buy furniture, build houses and pay our children’s tuition fees,” said Rosmawati.

High Repayment

In the PNPM-Rural program in this region, there are two modes of business loan, i.e. Productive Economic Business (UEP) with men and women members and Women Groups of Savings and Loan (SPP) aimed at facilitating women’s business. But later, UEP has more men members.

Uniquely, the two modes have different rates of repayment. A World Bank study showed that the average repayment rate under UEP was only 38 percent. The program was ended in 2004. On the contrary, the average repayment rate under SPP was 90 percent and the program continues until now.

Women very rarely break their promise to pay installments and are skillful at managing the money they have received. They have various strategies to prevent bad debts. They give top priority to the trust placed in them. Although the group members are neighbors and know well each other, members are recruited carefully.

“We will judge which women are serious about starting a business. We must carefully recruit members because the responsibility lies with the group. We fear that we fail to repay the loan. Members must also adhere to group programs and rules,” said Siti.

They also select potential members in their own way. “When someone wants to join the group, we will firstly observe her habit after she has received money whether she is busy looking for expensive cosmetic products and dress. They are our neighbors so we could judge them. We should not just gossip about salted fish, should we?,” said Rosmawati smilingly.

For smooth payment, the group requires members to make basic contributions, compulsory contributions and voluntary contributions. Immediately before payment becomes due to PNPM, they hold a meeting.

“If a member is past due, we have to draw it from treasury. Payments to PNPM should not be late to establish trust,” said Siti.

The registered account is the group’s account and disbursement cannot be made with the sole signature of the leader. They are aware that trust is significant capital.

These coastal women know of no such thing as “ngemplang” or running away from the obligation to pay their debts potentially leading to bad debts. In the hands of these modest women, such loans are extraordinary investment in their families’ economic growth. In their hands, there is still a hope to combat poverty …