HARHUA, India—In this sleepy village on the outskirts of the ancient city of Varanasi, Irawati Devi stands proudly under the bael tree that shades her home. Goats scour the ground around her mint-green food carts, searching for traces of the fried noodles and samosas she sells.
“When we first moved to Harhua,” Irawati, 58, recalls, “we wrapped saris around bamboo poles until we could afford to build walls.” With one small loan after another, averaging $290 at a time, she gradually managed to replace her home’s makeshift partitions with brick walls. She then bought the food carts, pots, and utensils to start the business that now supports her family.
Irawati’s story of using small loans to lift herself and her seven children out of poverty is one that could be told by millions of people across India. Lending to microfinance borrowers, mostly women in rural areas, has increased by 900 percent over the last six years—from $2 billion in 2012 to $20 billion 2018. With these funds, millions of marginalized families have started and expanded businesses, purchased essentials during emergencies, and supported their children’s education.
Over the past decade, IFC has helped create a market for microfinance in India by investing $564 million in equity and debt—including $5 million in Utkarsh, which now has 400 micro-banking offices that serve 1.7 million borrowers, including Irawati. Today, IFC has investments in more than a dozen financial institutions that together represent nearly half of all micro-lending in the country—reaching up to 70 million people, directly and indirectly.
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