Credit Connections: Baroda Citizens Council

This paper looks at the Baroda Citizens Council in Vadodara in Gujarat in India - established in 1966 as a voluntary, non-profit, secular development organization. The council's main objective is to improve the quality of life of the urban poor in the city slums by initiating and facilitating community development in the areas of education, health, vocational-training, infrastructure, and shelter upgradation programs. The essential elements of this type of development initiatives are:

• Participation by the community in efforts to improve its standard of living with as much reliance as possible on its own initiatives;
• Provision of technical, managerial and other services in order to encourage self-help initiatives and guided change.

In its early days, the Council recognized that inadequate access to financial credit was a major constraint for the slum dwellers and in response to this need the Council encouraged the formation of savings co-operatives. In 1989, the slum dwellers formally established the Community Savings and Loan Association which was transformed into a separate legal entity and registered as STHAPATI Credit Ltd in 1998.

The paper also studies two other examples of STHPATI initiative in Jai Bhavani Nagar and Ramdevnagar in Vadodara. The initiative provided loans in Jai Bhavani Nagar and Randevnagar to build toilets, underground sewage pipelines and hand pumps for clean water. This kind of initiative proved to be helpful to the residents:

• By decreasing the rate of diseases in the areas;
• By ensuring and promoting better health standards for the locals;
• Ultimately increasing income due to the longer hours available for income generation activities.

The paper concludes that the initiative was successful in both places as it:

• Ensured the provision of the necessary facilities in order to improve the living standards of the people in those areas;
• Allowed the community to collectively take the responsibility for ongoing, on-site maintenance of services by establishing a formal maintenance committee that is made up of local residents.

This committee will initiate and supervise future maintenance work and the finances for such work will be collected through cash contributions from residents, whenever repairs are required.