MICROCAPITAL BRIEF: US International Development Finance Corporation (DFC) Loans $30m to SEWA’s Sitara for Housing Microfinance for Women in India

The government-backed US International Development Finance Corporation (DFC), which recently took over the work of the Overseas Private Investment Corporation, has loaned USD 30 million to Sitara, an initiative of India’s SEWA (Self Employed Women’s Association), for on-lending to improve the housing conditions of poor women in urban areas. Formerly known as SEWA Grih Rin, Sitara offers loans for housing, business, education and other purposes in amounts from INR 50,000 (USD 660) to INR 1.2 million (USD 16,000) at annual rates of 18 percent to 20 percent for terms of 10 to 20 years.

Since its inception in 2011, Sitara has issued 9,000 loans for purchasing, building or improving homes. These improvements included installations such as running water, sanitation systems and sturdier roofing. As of March 2019, the company’s liabilities total INR 1.16 billion (USD 15 million).

DFC CEO Adam Boehler said the loan “is helping empower women and create stronger communities by providing clean, safe, and secure homes for low-income women and their families throughout India.”

SEWA is an organization of “poor, self-employed women workers” that was founded in 1972. Its goal is “to organise women workers for full employment…whereby workers obtain work security, income security, food security and social security (at least health care, child care and shelter).” SEWA has a range of programs addressing areas such as research, training, financial inclusion and building social businesses to boost employment. It holds 38 percent of the shares of Sitara as of March 2019.

DFC was launched in 2020 to “help businesses expand into emerging markets, foster growth and improve lives in the developing world, while reinforcing US foreign policy and national security interests.” The organization has an investment cap of USD 60 billion to deploy in forms such as equity placements, insurance, technical assistance and research. DFC focuses its efforts on low-income and lower middle-income countries in areas such as “energy, healthcare, critical infrastructure and technology.”

Sources and Additional Resources

DFC press release
https://www.dfc.gov/media/press-releases/dfc-ceo-adam-boehler-meets-women-borrowers-sitara-following-30-million

Sitara homepage
https://www.sgrlimited.in/

SEWA homepage
http://www.sewa.org/

Additional MicroCapital coverage on India
https://www.microcapital.org/?s=India

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