© 2023 Dr Margaret Sheppard

Organisation and Structure

The bank is owned by its members. RWDS members become JBS members by purchasing a total of 500 shares which they do by paying 10 rupees a week for 50 weeks.  After they have purchased 120 (i.e. after 12 weeks) they are

able to start applying for loans. Members are also encouraged to build up savings in their local bank. These individual savings are recorded in their special JBS savings books. The bank staff collect the member’s savings and deposit them in the JBS bank account in a local branch of a commercial bank. Members have easy access to these savings as their JBS will be much nearer than their nearest commercial bank and their local JBS accepts deposits and withdrawals from as little as 5 or 10 rupees. Members’ children are also encouraged to save in special Children's Savings Accounts and more recently non-members from the local communities have been allowed to use their local JBS bank. But only poor women may become members. The banking hours are Monday to Saturday 8.30 am to 4.30 pm and as the JBSs are mainly situated in rural areas, customers are saved the time and expense of having to travel into towns. Each branch has an account with the local branch of a commercial bank and members’ savings account money is safely deposited usually daily.

Savings accounts are an important aspect of the Janashakthi Bank Societies and all members are issued with the special JBS savings books. These earn interest - the 1994 rates were 12% for members’ savings and 14% for Childrens’ Savings Accounts. The money deposited in each branch is then recycled by being leant out in members’ loans.

So much for providing  the poor with local savings and banking facilities. The other problems that the JBS set out to address was the provision of credit facilities to members. This is provided through the small loan system. The loans

are of various types. Disaster loans cover emergencies such as in times of family illness, serious damage to housing during storms etc.. Cultivation Loans are to assist members to develop their rice paddies and chenas. Fishing Loans assist fishing families to attain a higher share of the catch (e.g. if they are able to buy a net, or perhaps even a share in a fishing boat they are thus able to qualify for a larger share). Self employment and Small Business Loans allow members to develop business enterprises. Some JBSs have Consumption Loans to enable members to buy food.

As members very rarely have any collateral a unique system of guarantees has been developed. Members form themselves into groups of five neighbours or friends. These 5-Member Groups meet weekly in one of their houses to discuss their problems and ideas. One member is chosen to be the Chair, another the Secretary (a minute book is always kept) and another is the Treasurer. Any member who has bought at least 120 shares can apply for a loan. Initially she will discuss her request with her co-members and, then they sign and guarantee her loan application which they then present to the local JBS Board. Procedure for an application is very simple and takes only about 2 weeks to be considered as the JBS Board meets fortnightly. (The application procedure for a Distress Loan is much faster and is made direct to their JBS Bank and repayment is at a much lower rate of interest - 1.5%.)

Each JBS is composed of 5 to 7 RWDS groups (i.e. 250-400 members). Each is run by its own Administrative Board which is composed of the President of its RWDS group, a Financial Secretary and an Administrative Secretary. Annually this Board elects a President and Vice-President. The Board is responsible for administering the loans and savings schemes, using their JBS funds to assist their members to develop their existing resources or to develop feasible self-employment or enterprise schemes.

The JBS started up as a bank without buildings. One of the members of each society allowed their JBS use of a room in their own house - rent free. The WDF provided a desk, a chair, a filing cabinet, cash box and the necessary stationery.

The daily business was run by two staff - the Administrative Secretary and the Financial Secretary. These are two local women of “A” level standard of education, who have been trained in administration and book-keeping at District level courses run by the WDF. They keep the accounts, ledgers and receipt books. They assist loan applications and keep the records of repayments. They receive a small salary from central funds. Overseeing their day-to-day work is the local JBS

Board and the Zonal Bank Secretary who regularly checks the financial records.

The Administrative Board of a JBS outside their bank which is in a spare room of the house behind them. This house is the home of one of the members

When a Loan application is approved the member signs for it and receives the money. The repayments are made with 3% interest per month at their local JBS. The sizes of the loans vary according to type and individual local society. For example in 1994  small business loans varied from 1000-2000 rupees, self-employment loans  3000-5000 rupees, cultivation loans 2000-5000 rupees, fishing loans 3000 rupees, and the distress and consumption loans  500 rupees.

Loan repayment rates were very high, 98-100%, which is in fact a better record than that of commercial banks. As members guarantee each other's loans they feel a responsibility towards their colleagues so this is perhaps why repayment rates are so high despite the initial poverty- of the recipients.

It should be noted that although only women can become members of their JBS and only women can take loans, they are allowed to take loans on behalf of members of their families. For example wives often take loans for their husbands, e.g. for their carpentry, building or fishing enterprises, or a sister may take a loan for a brother's paddy field etc..

A member signing receipt for her loan

A husband repaying some of wife’s loan

Loan application form. In 1994 there were still many adults who were illiterate like this member. She has signed for receipt of her loan with thumb prints.

Member checking amount outstanding on her loan

JBS Administrative Board meeting to discuss loan applications forwarded by their local 5-groups. They each sign their approval on the application. Behind them on the wall of this JBS branch are charts showing details of all current loans made and repayment rates (repayment rates rarely fall below 96-98% rates).

All members are enrolled in a Group of Five fellow women - one from each identified household. The 5 - Group is extremely important as these fellow members offer each other mutual support and ideas to improve their household livelihoods and to support each other with their problems and adversities. They meet regularly at each other houses and one of them will record minutes of these meetings. At these meetings they may for example organise group savings - each contributing 5-10 rupees a week. Then with these savings that they keep at the local JBS in a group account, they may decide to make wholesale purchases of household necessities such as soap, kerosene, rice, spices etc, to reduce their household expenses. They often share these items at a cost between the current wholesale and retails prices to increase the group savings.

They will discuss and share micro business ideas and then if a member needs to take out a loan from the local JBS, they will each sign to guarantee the repayment of the loan on the application form. The Social Mobilizer attached to their local RWDS group often attends these weekly meetings to offer further assistance and advice from her knowledge gained from training provided by WDF courses and discussions. These mobilizers offer support where needed they never IMPOSE their own ideas.

If one of the members  needs help in e.g. digging out a pit latrine, mending a roof or making bricks etc,, the fellow members and their husbands will assist.

The 5 Group is the grass root of the Janashakthi Movement to relieve poverty and promote development and in December 1993 there were 3729 Groups of Five. It is these members who identify their problems and the help they need to overcome them. Nothing is imposed on them. For example they identified health issues and the difficulty of accessing medical care. This led to talks at RWDS meetings on e.g. Public Health, Nutrition, Family Planning and a regular mobile clinic attending at the Temple to identify and treat individuals and refer and encourage if necessary, to the hospital or specialist clinics such as cataract removal provided by Overseas charities such as Sight Savers.

The Groups of Five (5 Group)

5 Group weekly meetings, typically attended by the local Social Mobilizer to offer support and advice when asked. Minutes are carefully recorded and the accounts of Group Savings. Group Purchases  at wholesale prices of household necessities are also distributed, and ideas shared. Thus no member suffers social isolation.