SOIL Report 2008 - ACCESS Development Services

Chapter VIvarious district federations. Apart from these male fisher folk members, about 3,636 women members,through the affiliated women’s federations, are linked to the SIFFS network.The key lessonfrom SIFFSis that oneshould not usetraditionalmicrofinanceapproaches forlivelihood financingincludingfisheries.SIFFS as an apex body has commercial and non-commercial functions. It has three core business areas- fish marketing, technology intervention and credit delivery/facilitation. The non-commercial functionsinclude research and development for appropriate technology for fishermen, information dissemination,advocacy and collective action and training. SIFFS is a sectoral intervention using a ‘commodity cooperative’model where the main target group is seagoing fishermen who are normally exploited by middlemenand moneylenders who control the beach-level fish sales. To counter this exploitation, the village levelsociety model was developed in the early 1970s, based on the concept of fishermen having their ownmarketing arrangements and linking it with a savings and credit system. The SIFFS society model is arelatively rare one where marketing, credit and savings are integrated into one single system at the villagelevel. xiii The key lesson from SIFFS is that one should not use traditional microfinance approaches forlivelihood financing including fisheries 15 xiv since the minimalist approach of finance/credit alone will notwork. An integrated approach using financial and non-financial services is what will work.Some key initiatives:• All fish caught by members is sold through the village society• The society sells fish through a beach-level auction and when necessary, by direct sale to wholesalersand export companies• All fish sales income of a fisherman flows through the society• Source deductions for compulsory savings (often 2-3 per cent of sales income), loan repaymentsand other contributions• Compulsory savings and loan repayment, made from a percentage of the sales income rather thanfixed instalments• Society overheads covered through a small commission on fish sales (2-3 per cent) and the surplusused to build up capital fund and/or to provide a ‘bonus’ to membersSavings can generally be withdrawn (on the basis of locally determined rules) for various consumptionneeds and emergencies. It is also the source of liquidity for the society that allows it to pay the fishprice to members on the same day even though the buyers may take time to pay up. Fish is mostly soldon credit for periods ranging from one day in the case of locally consumed varieties up to a week forfish going to distant markets and exports. Thus the savings as well as the capital of a village society isonly nominally used as a source of credit for members. This means that most of the credit needed forreplacement of fishing equipment has to come from external sources. This is achieved by linking thesociety to a local branch of a commercial bank. Such credit is given to the individual by the bank, on thebasis of a guarantee by the society. The society then recovers the money through its source deductionsystem (normally 10 per cent of fish sales income), accumulates the loan repayments and remits to thebank on a monthly basis. xvBoat Building: SIFFS pioneered the introduction of marine plywood boats in 1982. Since then, it hasbeen playing a major role in the promotion of marine plywood boats in three districts on the southwestcoast of South India. The three districts of Trivandrum, Quilon and Kanyakumari were characterised byrough surf conditions and the availability of a large number of fish species in small quantities, resultingin conditions that favoured small-scale diversified fishing operations. The kattumaram, a fishing craft,has been the mainstay of the small-scale fishermen in these districts for centuries. Due to increasingdeforestation in early 1980s, timber for kattumaram was becoming scarce, and a need was felt for analternative. The plywood boat project was the result of the efforts in this direction. Today, SIFFS is aleading player and price leader in the plywood boat building market in the southwest coast of India.144