People are the best capital:
In 1987, the first counter-attack began. Funded by the Ford Foundation, Anna University in Chennai began a study of sustainable schemes for water security. They discovered the obvious: that without recharging villages' water bodies with rain water, capital assets like pumps and irrigation systems have no meaning. Vasi was consulted for his knowledge of villages' social structures, in order to organise people in water harvesting. That was a major turning point. He had been a farm child and yet, it had taken him 32 years to look past 'modern' education to understand sustainable living. [Urban Indians can be forgiven if they take longer. Only, one hopes time will be on their side.]
His eyes began to see villages differently. His ceaseless proposals-writing and fund raising had scaled from Rs.1 crore to Rs.30 crores in his five years with ASSeFa. This had been poured sincerely into villages with no leakages. Yet, from sustainability point of view there were few successes. Most initiatives needed constant re-funding.
PRADAN then became convinced that professionals must themselves become innovators in development and not remain mere managers. Vasi ended his deputation to ASSEFA and returned to PRADAN.
In 1990, PRADAN conceived the Kalanjiam idea ['granary', in Tamil]. It was a micro-finance initiative for women and it became, after two years of field work for an initial breakthrough, a runaway success. Simultaneously, he set up a team to start work on the traditional water bodies at Madurai. In 1992 he took over as the Executive Director of PRADAN and the head office shifted to Madurai. The next five years took him all over the rural heartland of North India in Bihar, Orissa, Rajasthan, West Bengal etc to consolidate, strengthen and broaden the scope and depth of the work of PRADAN.
PRADAN was created to 'build people to build more people'. Ideas must be conceived, tested, proven and then scaled to become well-oiled systems- and then left to people themselves to manage. In keeping with that thinking, PRADAN thought it fit to spin off DHAN, by 1997 with Vasimalai as its Executive Director.
After proving the workability of thrift groups managed by barely literate women, DHAN began to scale up Kalanjiam. Avoiding a pyramid, they kept federating small sized self-help groups [SHG]. These autonomous federations are affiliated to DHAN for mutual consultation and idea generation. Soon the Kalanjaiam movement was self-reliant enough to be spun off from DHAN; the Kalanjiam Foundation [KF] is today an autonomous body in the DHAN Collective.
And now, Micro-Insurance:
Mayiladumparai- what a lovely name! In Tamil, it translates as 'rock on which peacocks dance'. But when the first Kalanajiam began there 1994, it was a remote block of Theni District which was sinking in poverty. Men took to drink or buses to nearby Kerala. Young children were sent away to far Andhra to work and feed themselves. Once a wooded country, over-grazing had turned it into near desert. Usurers completed the ravaged scene.
Today, the Kalanjiam Federation there -Kadamalai Kalanjia Vattara Sangam [KKVS]- consists of 270 Kalanjiams with over 4,000 women members in 81 villages. They have a saved capital of Rs.180 lakhs. That money -plus much larger leveraged loans through banks- has seeded many income generation activities.
Women there have turned out to be unstoppable innovators. In 1997, KKVS launched the first version of its life insurance scheme. For a premium of Rs.100 a year, a member and her husband ,if they were under 55 years, were covered for life and assured for Rs.10,000. The idea was an instant hit in an area where heath services are notorious. 1,000 members signed up.
By 2000, 1,500 members had signed up. KKVS now extended cover for hospitalization expenses, unless it was a chronic illness. Hospital expenses up to Rs.10,000, for the whole family including unmarried children, was covered under a premium of Rs.150.
There are insurance committees at local Kalanjiams and at the federation level. These are tough businesswomen. They tied up with a few hospitals in nearby Kadamalaikundu and Theni, after bargaining for the best deal. Patients are admitted without any advance payment, KKVS's credit worthiness being sound. Members also get a 20% discount.
For the intrepid innovators of KKVS, even this was not the end. In 2004, after working out the economics of their insurance as a business, they built a small hospital next to their office, and hired a full-time doctor: members can avail medical services using their membership cards and paying just 25% of the cost. And then they closed the circle: it is now mandatory for all members to join the insurance programme, if they were seeking credit from Kalanjiams.
In just four years, these nearly illiterate women have shown their innovation and management skills. Their books are audited internally and externally. The business has shown a surplus for every year since inception. Health and hygiene levels have risen, along with confidence levels. The entire programme was evolved by rural women, with an occasional nudge and input by DHAN.
They have driven big insurance companies out of town. In any case, pressured by the insurance regulator, IRDA, these companies were practicing tokenism, to claim they covered poor people as well. KKVS has made them redundant. No longer do people need to fill the papers that corporations want; nor do they need to beg their claims to be processed. Deaths or illnesses are verified by members for faking. Bills are settled immediately without elaborate paper processes. Significantly, all the premia stay within the local economy instead of gathering in some high-rise office in a far city.