Wo e s Ide tity, So ial P ote tio and Entrepreneurship

Dev Nathan

Institute for Human Development, India and Duke University, USA

Govind Kelkar

Landesa, Rural Development Institute, India & Seattle,USA

Identity in Development

• Identity – e ui ed fo a i di idual s ight to a ess fo al i stitutio s,

such as government entities, employers, banks

•

• Industrialized countries – official identity established at birth

•

• South Asia had highest proportion of children not registered at birth – 63% against 55% in Sub-Saharan Africa

•

• India – non-registration of 45% of 26 million births p.a.; Urban-rural variation

•

• Bio et i ide tifi atio a eli i ate ide tity gap • China, India, Brazil, Iran, Israel, Indonesia – and many others using it

•

• Aadhaar – I dia s io et i ide tifi atio syste has ea hed 0 illio

Why Identity ?

• To access state and formal services – food, subsidies, elections, property, credit

• Consequences of Being Marginalized and Invisible –

– Forced to pay bribes, subject to extortions (e.g. homeless

in cities)

• – Higher transaction costs

• – Reinforces inequality

Benefits of Identity For Poor

• A pavement-dweller, [on how Aadhaar helps]

The poli e o t ha ass us.

•

• Foundational identity – does not itself confer

any benefits, but can be used for anything

requiring establishing identity

– Bank account, etc.

Women and Identity

• Women, traditionally, have only had a relational

identity (daughter/wife/mother)

•

• For matters related to the state, need a personal identification, which can be verified by a third party

•

• This is Aadhaa s first rupture with tradition

•

• Can allow move from household-based entitlements to individual-based entitlements

Benefit: Enhance Wo e ’s Age cy

• Receive transfers in own name

• A t o o e s o hoi es

– E.g. widows using their pensions to buy medicines

• Many steps to empowerment- plus

overcoming resistance of men

Aadhaar - Direct Benefits Transfer

• [Cash Transfer]

•

• Aadhaar plus micro-ATMs (point-of-sale

instruments)

•

• Woman will get the full household

entitlement

Formalization

• Can support formalization – e.g. of rights as

street vendors

•

• Portability of rights – importance in context of migration

•

• Last-mile for financial inclusion (Only 25% households have bank accounts)

– Can be linked to private data bases (pay a fee for use)

Reducing Cost of Service Delivery

• Problem of ghost and duplicate cards

• E.g. in AP more BPL cards than state

households in Census

• Biometric identification – can eliminate ghost

and duplicate cards

– More than 25% saving

Women and Entrepreneurship

• Do not own assets, e.g. land, for collateral

•

• Need support from male members to access bank loans

• Restricted to home-based, self-employment with low working capital requirements

•

• Can social protection deal with this problem?

Social Protection

• Income / consumption support to poor and

non-poor

• Financial access to health care

• Non-contributory and contributory systems

• But social protection is loaded with patriarchal

o s of head of the household

Social Protection and

Entrepreneurship

• Additional income can enable investment and increase productivity

• Assured minimum can increase risk-taking ability

• Manage trade-off between immediate needs and future livelihoods

• Manage disasters without asset sale

Providers of Social Protection

• Usually the State

• Also the Community (in traditional

communities)

• What about Group Social Protection, as in

I dia s SHGs a d so e MFI g oups?

Individual identity of women

• MFI clients are 95% women

• Services delivered to women

• Use within household affected by patriarchal

norms

– But evidence shows – over loan cycles women

assert their decision-making on use of credit

• Plus benefits of being organized

– Able to get better public services

Consumption Stipend

• For ultra-poor till they can arrange staple food

on their own

– In 18 months become regular MFI clients

• BRAC (Bangladesh)

• Combines government-subsidised food and asset transfer

with micro-finance

• Later become regular MFI clients

Sickness Allowance

– Whe a e e falls si k, e pay ‘s. as si k allowance per day. If she is not a member, mere

loan will be given

– If the member is genuine, she will be supported

by the cluster fund for any such immediate needs

like shelte da age o si k ess.

• Sickness is major reason for non-poor to

become poor – cost of treatment, income loss

Savings or loan for distress

– Sa i gs a d ha i g o ey at ha d easo fo feeling secure

– Members are able to use borrowing or savings

rather than sale of assets in distress

Savings and insurance

• Then move on to micro credit (BASIX)

• Provide consumption loans, as against

Grameen Bank model where consumption

loans are not allowed

Impact

• Enable women, over time, to reduce share of

consumption loans and increase share of income-generating activities

• Reduce share of income from agricultural labour to self-employment

• The share of NREGA income that is saved is much less than the investment from the MFI. Why?

• MFI money has to be returned, unlike NREGA money; that would induce some investment in income-generating activities

Conclusion

Group-based social protection

Can provide consumption and healthcare

support

And enable women to access working

capital and become entrepreneurs.