Hurdles in access to banking services leads government to propose special women's bank.
In India's banks, women are bound by men's signatures
NEW DELHI // Purnima Rai went to four different banks in New Delhi, asking for permission to open an account.
Ms Rai, 20, works as a domestic helper in New Delhi, but because she is from Darjeeling, in the north-east of India, it created a host of problems for a banking system that requires at least two forms of identification and proof of residence.
"Everyone asks for documents, no one is flexible about what we have or don't have. If we live in Delhi and have a residence elsewhere, then it is very difficult," she said.
After six months of trying, a bank agreed to take her money, but required a deposit of 10,000 rupees (Dh675) - a hefty sum given her monthly salary is only 6,000 rupees. She was forced to turn to loan sharks, who charge usurious rates of interest.
Ms Rai blames her gender for much of her struggle. She points to her battles with the bank that finally accepted her money but would not deliver an ATM card. She made numerous trips to the bank to inquire about her card and was given a host of excuses. It was only after she brought a male relative along that the bank found her card in a storeroom cupboard.
If women are not employed, then they face additional hurdles in using the banking system, such as needing a husband's or male relative's signature on cheques.
"They make us feel like we don't belong here," Ms Rai said.
In the budget last month, the Indian government announced its intention to open a women's-only bank in October.
"Can we have a bank that lends mostly to women and women-run businesses, that supports women SHGs [self-help groups] and women's livelihood, that employs predominantly women, and that addresses gender-related aspects of empowerment and financial inclusion? I think we can," the finance minister, P Chidambaram, said in his budget speech.
There have been few details released about the project. Alok Nigam, a joint secretary in the finance ministry, said he could not comment because it was still awaiting approval. What is known is that only 12 per cent of India's approximately 500 million bank accounts belong to women.
Organisations that provide financial services in rural areas say a women's-only bank could help to overcome the problem posed by cultural restrictions on the mingling of sexes that are still common in certain parts of India.
"Women will feel more free with the same gender. They can connect and express their needs, their future plans and the understanding will be better," said KS Chhabra, an area operations manager for Delhi with the Zero Mass Foundation, an organisation that provides financial services in villages.
But he questioned whether women would see the need for an account, especially in conservative households that leave financial decisions to men. "Normally the women say 'we don't need an account since men have one'," he said.
Anand Sahasranaman, head of the IFMR Finance Foundation in Chennai, said the women's bank cannot simply follow the traditional model if it is going work in remote areas, where his organisation brings financial services to the poor.
"A major concern is, how does it plan to deliver a range of services to women, in a way that current financial systems cannot do," Mr Sahasranaman said.
He said the bank must also account for the unreliable nature of agricultural incomes, where men leave for cities to work as daily-wage labourers between growing seasons and women stay behind to run small businesses.
"There is a choppiness of income. And an institution for women has to be designed keeping in mind the solutions they need. You cannot go in with predetermined products and ideas," he said.
Critics of the government's proposal say that "separate but equal" financial institutions will do little to overcome the barriers to banking.
"A women's bank does nothing to help a woman, especially an illiterate woman, draw a cheque or open an account," said Priya Ravichandran, a graduate programme officer at the Takshashila Institution, a think tank in Chennai.
Ms Ravichanadran said the bank plan was part of India's misguided efforts to bolster gender equality.
"There are already separate colleges, universities, and seats on a bus. They have already created this idea that women are different and they have to be given separate provisions to lead their lives. It is this idea that you are on a par with men but you will remain separate."
What Ms Ravichandran would like is simpler banking systems for women within existing banks.
"Women are intimidated by the aura of the banks," she said.
"Simplify the process, remove the intimidation factor and stop them from being forced to bear the burden of men, whether it is to relieve their husband's debt or whether they need a signature from a husband or father to open an account."
Judy Pulamte, 26, works as an assistant manager at a coffee shop in New Delhi. Going to the bank is considered the job of men, even if they are her subordinates.
"Normally the boys, they do it for the company but if there was an all-women's bank, then maybe I would also go do that," she said.