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19 The base suicide rate in AP is 14 per 100,000. There would be cause for concern only if the rate among
the borrowers of an MFI were significantly above this. None of the allegations in the press and from
government seemed aware of this, apart from the fact it is very hard to determine the cause of a
suicide. This is not to imply that suicides are not tragic whatever the reasons.
20 This is the term used in the literature (e.g. CGAP 2004). In India abusive is also commonly used to refer
to verbal abuse, another practice field workers were accused of, as noted below, but it should be
remembered that what is considered abusive in the latter sense is culturally specific.
21 Frequency of mention, not necessarily use.
22 Only as a "last resort" were mostly larger, individual, loans, recovered by encashing signed blank
cheques, or taking legal action to enforcing blank promissory notes. Use of blank documents is of
course clearly an abuse, and lay behind the cheating cases registered. Two respondents mentioned
physical force, exercised presumably by centre and group leaders, since a lone field worker would risk
retaliation (one was in fact murdered soon after the crisis).
23 The CMF in collaboration with KAS Foundation is experimenting with the impact of introducing flexible
repayments schedules, such as allowing the client to skip up to two principal installments through a
coupon payment system which simplifies the accounting for both MFI and borrower, or allowing the
client to pay double the principal installments during the first six months of a milch animal loan when
the animal is productive (see Chapter 9).
24 There is an interesting discussion of emergency loans in the annual report for CASHPOR for 2005-06.
25 But not "long and dirty" ones, which is too often the alternative.
26 Spandana has introduced what it calls a small business loan product, mostly in the urban areas where
about half its borrowers reside, to members who have established a track record through the regular
group lending programme, or to their spouses, with a maximum loan size of Rs 1 lakh (compared to
the earlier ceiling of Rs 15,000, but with average loan size presently of about Rs 25,000) and
customised tenor which could extend to 4 years. These loans are expected to constitute as much as 15
to 20 per cent of the portfolio this year.
27 This is contrary to the widespread advantage claimed for weekly repayment that it makes repayment
easier, and to what some women told this author during a visit to a village in Krishna district where
repayments stood suspended after the crisis, that they regretted the fact that they were working less
because they no longer needed to raise money for the wages to meet the next repayment.
28 The previous government was also acutely conscious of the political importance of Velugu and offered
members incentives, especially before election time, such as easier access to gas connections. It could
be argued though that competition through bribery is preferable to attacking the other model.
29 The CIF is a component of Velugu, under which funds are passed down through the two upper-tiers of
the three-tier structure, Mandal Samakhya's and Village Organisations, to the SHGs, with the intention
to make each tier self-sufficient in the long run through an interest differential added on each stage.
The World Bank's original intention was for CIF to finance small collective projects started by Common
Interest Groups of the poor, prepared with their participation under micro-plans, but in view of the
poor recovery rate (of 45 per cent in 2003-04) is now used mostly for individual loans by the SHGs,
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