Self employed workers are those who earn a living through their own small business or through selling their own labour. These are workers who have no fixed employee-employer relationship and depend on their own labour for survival. They are poor, illiterate and vulnerable. They barely have any assets or working capital. But they are extremely economically active, contributing very significantly to the economy and society with their labour. This sector of the economy is called the unorganised sector.
There are four types of self-employed or unorganised sector workers.
Hawkers, vendors and small business women selling vegetable, fruit, fish, eggs and other food items, household goods and clothes.
Home-based workers like Weavers, Potters, Bidi and Agarbatti workers, Papad Rollers, ready-made garment workers, women who process agricultural products and artisans.
Manual labourers & service providers like agricultural labourers, construction workers, contract labourers, handcart pullers, head-loaders, domestic workers and laundry workers.
Producers.
SEWA
92% of all workers in India are in the unorganized sector.
96% of all women workers are in the unorganized sector.
A group of such self employed women first formed their own organisation in 1972 when the Self Employed Women's Association (SEWA) was registered as a trade union in Gujarat, with the main objective of "strengthening its members' bargaining power to improve income, employment and access to social security." SEWA sees itself not merely as a workers' organization, but as a movement.
It is in fact, a confluence of three movements. The labour, co-operative and women's movement. Gandhian Philosophy is the source of inspiration for SEWA. SEWA has an all India membership of using the dual strategy of struggle and development, thus enabling them to enter the mainstream of the economy. In this process, women have become more confident and autonomous. Through its joint strategy, SEWA has helped workers organize around various issues, resulting in their being able to raise these with Government as well as in the society in general.
SEWA Bank
A small group of poor self-employed women residing in Ahmedabad, who were members of Self Employed Women's Association (SEWA) a trade union of unorganized sector women workers, realized a need for "PROMOTING" THEIR OWN Financial Institution.
This need was based on three major reasons.
They need capital for running their day to day business as well as for buying equipments for this business.
Such borrowings were on exploitative terms and they desperately wanted to come out of the clutches of these money-lender.
They wanted some safe place to put their "Savings"
Their experience in dealing with formal banks through SEWA UNION had made them realize that it will be extremely difficult for them to avail banking services from these formal Institutions.
They articulated this idea in a meeting of Sewa members in the year 1974, also took responsibility of convincing other poor women, contributed required initial share capital for promoting a bank of their own and signed as "PROMOTERS". Out of total 15 Promoters, only two were non-poor who facilitated registration process.
So, the first Micro-finance Institution, was established in year 1974, as an Urban Co-operative Bank, at the initiative of few poor self employed women.
Self employed women workers and producers are economically very active and contribute to the growth of the economy. They are mainly involved in production, trading and the service sector. However, in spite of their hard work and their contribution to the country's gross domestic product, they do not have access to financial services, which would help them to upgrade their own work and productivity.
Self-employed women face two major financial problems:
1. Lack of working Capital
2. Non-ownership of Assets
As a result, a big portion of their meager income goes towards interest on working capital and rent on trade equipment. Terms of borrowing from money-lenders are very exploitative and the formal banking sector is not usually responsive to the special needs of informal sector women workers, in terms of providing appropriate banking services.
Thus, in order to address this problem and free themselves from the vicious cycle of eternal debt, the members of SEWA came forward with their own solution, in a meeting in December 1973: "a bank of their own", where they would be accepted in their own right and not to be made feel inferior. "We may be poor", they said "but we are so many", and indeed 4,000 women contributed share capital of Rs.10/- each to establish the MAHILA SEWA CO-OPERATIVE BANK . In May 1974, the SEWA Bank was registered as a co-operative bank under the dual control of The Reserve Bank of India and The State Government. Since then it has been providing banking services to poor, illiterate self-employed women and has become a viable financial venture.
