Madura Microfinance


The Madura Experiment (more refined)

Posted on September 12, 2010 by Tara Thiagarajan in Blog, Writing. 2 comments

It’s been a bit of a busy month for me and I haven’t had time to post. After years now of reading, surveying, observing and thinking, we (meaning Madura) are finally putting together the pieces of our socioeconomic transformation strategy. We’re taking quite a leap from the run-of-the-mill microfinance, so we’re operating like a start-up again, which is fun. But, with profits to take some chances with, so that’s even more fun. We’re looking at a massive, for profit experiment in reengineering the socioeconomic system dynamics of our members – about half a million poor women in rural Tamil Nadu, moving rapidly to a million. This involves putting in place a large scale smart phone driven data collection system, a mobile phone rollout for our members that will support a host of applications in the future, and development of a … Read More »


Mobile Phone Data Capture

Posted on June 19, 2010 by Tara Thiagarajan in Uncategorized. 4 comments

Madura is about to embark on a massive mobile phone enabled data capture exercise that will create some of the largest and most unique datasets in the world on the poor. We currently have about 160 locations that manage loan repayments through a mobile app that runs on a windows platform. We are now about to make an additional 500 of our field staff capable of capturing massive information through various mobile applications. The survey apps are being tested on these same windows phones that have worked well for us for our loan servicing needs. However, in this case, the apps are much more data intense. Consequently the phones have to work much harder, run longer, be able to withstand being dropped off the bus a couple times and have sufficient memory to store data given that network connectivity tends … Read More »


Increasing the rate at which ideas have sex?

Posted on June 3, 2010 by Tara Thiagarajan in Uncategorized. 1 Comment

Interesting article in the WSJ by Matt Ridley called Humans: Why They Triumphed. He says:

Trade is to culture as sex is to biology. Exchange makes cultural change collective and cumulative. It becomes possible to draw upon inventions made throughout society, not just in your neighborhood. The rate of cultural and economic progress depends on the rate at which ideas are having sex.

Underlies the assumption on which we work at Madura – that poverty is an outcome of an impoverished network with slow flow of information. By increasing the rate at which people connect and interact with knowledge and information, we believe, interactions become more productive and magic will happen. In Matt Ridley’s words we are facilitating trade and idea sex.


What’s a newspaper for?

Posted on May 21, 2010 by Tara Thiagarajan in Blog, Microfinance, Writing. 2 comments

We (Madura) recently launched a classified ad newspaper that reaches 400,000 poor rural households in Tamil Nadu. Our women borrowers can advertise their products, services and things they want to buy and sell free of charge while companies must pay. This is a hard to reach demographic that does not generally interact with print. One of our office locations used a women’s day event that gathered 700 of our women borrowers to launch the paper in their area. I didn’t attend this launch but our CEO reported to me that a very large number of women took the paper that was handed out and immediately used it to wrap up the snacks that were served to them.

(One useful statistic to put this in context is that about a third of our borrowers cannot read. Still….)


The Strength of Weak Ties

Posted on May 3, 2010 by Tara Thiagarajan in Blog, Writing. 2 comments

I have been thinking a lot about how to understand poverty from the point of view of the properties of the social network. In this context, I thought I would share with you a very important paper by sociologist Mark Granovetter written in 1973 called ‘The Strength of Weak Ties’ which he has more recently revisited in a new paper called ‘The Strength of Weak Ties: A Network Theory Revisited’. Here is an excerpt:

…..individuals with few weak ties will be deprived of information from distant parts of the social system and will be confined to the provincial news and views of their close friends. This deprivation will not only insulate them from the latest ideas and fashions but may put them in a disadvantaged position in the labor market, where advancement can depend, as I have documented elsewhere (1974), on … Read More »


Connected we succeed, divided we default

Posted on April 26, 2010 by Tara Thiagarajan in Blog, Microfinance, Writing. 3 comments

At Madura Microfinance, one of our primary assumptions is that women who are more informed and better connected will be more successful and make more productive use of loans.So, much of our efforts are aimed at increasing networks and access to information among our members. A PhD Student from Oxford, Sangamitra Ramachander, recently studied our women’s borrower groups to see what kind of factors predicted whether a group went successfully on to the next higher level loan or would default.This is still a work in progress but there are some very interesting results. Here is one odd one that stood out to me. She found that women that travelled more frequently to neighbouring villages (but surprisingly not the nearest towns) were several times more likely to be successful rather than default. It’s not clear whether this factor is … Read More »


Driving socioeconomic change by making women more dependent

Posted on April 19, 2010 by Tara Thiagarajan in Blog, Microfinance, Writing. 6 comments

Yes, I meant to type dependent. Here’s why.

One of the great drivers of mankind’s progress has been our ability to specialize in our knowledge and functions, organize as groups or entities that share knowledge and create amazing things that no individual could do on his or her own. Done well, the outcomes of organizations are far greater than the sum of its parts. The most awesome things that mankind has created – jet planes, space stations, the power grid, they are all borne of interconnected, highly dependent networks of people. Our (Madura’s) women micro-entrepreneurs are the antithesis of this dependence. They are highly unspecialized and operate independently (women, only because that’s who we serve, but this applies to men too). These micro-entrepreneurs strategize, produce, market, manage accounts and do everything on their own. This means that they rarely … Read More »