Village Earth/HELPO Microfinance Project in Pune, India

Microfinance has proven itself as a powerful force in village-based development around the world. It empowers the villagers, especially women, bringing economic success to once impoverished families. The significance of microfinance in a developing world is currently reflected in the emphasis of the work of Village Earth. which views microfinance as one part of a holistic approach in which all aspects of sustainable village based development are integrated and complement one another.

Villages need greater access to financial resources and general business skills. Taking this need into account, Village Earth and the HELPO foundation of Pune, India formed a memorandum of understanding (MOU), defining their partnership. Through Village Earth’s partnership with the HELPO foundation, over 3400 families have economically benefited by the formation of 170 Community Savings Groups (CSG’S) in Pune. These CSG’s exist in some of the most remote areas of India.

The microfinance approach that the HELPO foundation employs, widely known as the savings-led approach, is unique in the world of microfinance. The savings-led approach emphasizes asset building rather than the creation of a larger base of debt, one of the most prevalent obstacles facing the developing world. HELPO overcomes this obstacle by providing the savings alternative.

As of March 1st, 2002, 170 CSG’s have been established in 70 villages with in the Pune District of the state of Maharastra, India. With approximately 20 members of each group, roughly 3400 women and their families have begun to feel the economic benefits of microfinance.

The village of Veer within the Pune District serves as a concrete example of the growth of the HELPO foundations efforts. Veer is a remote village of roughly 7000 individuals, whose principal economic activity is horticulture due to the abundance of water resources. Within Veer there are 18 CSG’s in existence, of which 16 are composed of women and 2 are composed of men. In April 2002, a training center for the manufacture of cloth bags enabled women to learn entrepreneurial skills that allows them to establish their own businesses, with the start up capital being furnished from the loans available to them from the CSG’s to which they belong.

The overwhelming success of this microfinance work by HELPO in India indicates that the saving-led approach to microfinance is a vibrant, self-replicating approach to economic improvement that can be applied in poverty-stricken areas around the world. It is for this reason that Village Earth seeks to expand its microfinance program, carefully evaluating the success of the CSG’s in Pune, and spreading this approach to other areas of the Village Earth involvement.