18

Sa-Dhan Patrika

Volume 6

Issue 1

Reflections from Swiss Agency for Development and Co-operation

Donors perspective on providing

capital to MFIs

S

DC's cooperation with India is more

pursuing a common cause, which

t h a n four decades old. The first

in  our  context  is  humane

bilateral project in India, the Indo-Swiss

development.

Project Kerala began in 1963, which

Why and how is SDC active in the

ultimately developed into an Indo-Swiss

field of Rural Finance in India?

programme for livestock production in

According to SDC's Financial Sector

different parts of the country. SDC, till the

Policy , SDC aims at contributing to

late '70s, worked mainly with government

poverty reduction through the promotion

institutions and indirectly through Swiss

of 'inclusive financial sectors'. Experience

non-governmental  organisations

has shown that in a rapidly globalising

(NGOs), which cooperated with civil

world shaped by market forces, the poor

society organisations (CSOs). Since 1979,

are increasingly getting marginalised from

SDC has been working directly with

CSOs. Today it is predominantly so, with

mainstream economic activities. As a

the overall objective of contributing

result, they are becoming more and more

towards reducing poverty by specifically

vulnerable. In this context, it is important

supporting  decentralisation  and

that poor households and micro- and

e m p o w e r m e n t processes, fighting

small enterprises continue to have

discrimination and providing assistance

sustainable access to financial services

in `rural energy and housing', `rural

be they savings, credit, insurance or

finance  and  employment,'  and

social security measures. Depending on

`retention of water and sustainable use'.

the context, SDC has interacted in

different parts of the world with partners

SDC's interventions are governed by a

at the micro- (financial institution), meso-

specific development law, which

(financial sector infrastructure) and

basically stipulates that its contribution

macro (policy and regulatory) levels.

should help to reduce poverty and

thereby be guided by "producing"

In India, with its large formal banking

SDC aims at

sector encompassing commercial,

sustainability in its largest sense. The basic

contributing to

cooperative and Regional Rural Banks,

value system behind this law comprises

poverty reduction

SDC's focus has been on promoting

among others attitudes guided by

through the

linkages between the formal and the

e m p o w e r m e n t , solidarity, respect,

promotion of

informal sector by supporting innovations

compassion,

empathy,

equity,

'inclusive

and facilitating change management

s u b s i d i a r i t y , self-responsibility and

financial sectors'

practices among the key stakeholders.

autonomy. Our understanding of

SDC  believes  that  access  and

empowerment and solidarity which are

representative of our value system is as

sustainability issues are important in the

follows:

Indian context, that poor men and

a.  Empowerment

means

the

women are bankable and they need to

experience of being enriched in

have access to sustainable financial

giving away and in sharing one's

products and services like savings, credit

own power which can be in the

or insurance.

form of knowledge, skills, capabilities,

personal strengths, resources, control,

Some examples of SDC's cooperation

decision-making, influence etc. With

with Indian partners are as follows:

the purpose to create autonomy,

a.  In the recapitalisation and reform

energy and motivation within

programme of the Government of

individuals,

groups

and

India for Regional Rural Banks (RRBs),

organisations to harness their ability

SDC supported the Organisational

and potential to design their own

Development Initiative (ODI) with

development and destiny.

the aim to facilitate innovation and

change processes in 150-plus RRBs.

b.  Solidarity not only means a feeling

Partners in the programme (NABARD

of unity with others but also to be

and BIRD) have seen ODI as an

supported, inspired, reinforced as

alternative to bank restructuring

well as energised by others for