Cutting Out the (Middle) Man in Kathmandu

7 July 2010 at 03:34 6 comments

Chris Baker, KF11, Nepal

Much has been written about the value of investing in women.  The Girl Effect theory says that women are simply better investments when compared to their male counterparts.

With access to capital, women are empowered.  They buy the things their families need.  They educate their sons and daughters.  The investment of initial capital is magnified and extended, right?

But what does the Girl Effect look like on the ground?

What else happens when you invest in women?

Meet Laxmi*.  Laxmi makes intricate metal statuettes representing Buddhist and Hindu deities.  Laxmi buys wax molds, raw metals, and finishing tools for her small operation.  She works on the statuettes in low lit room near Patan’s Durbar Square, south of the capital of Kathmandu.

Patan has been the heart of Nepali religious and artisan culture for over 2,000 years.  The figures formed in Laxmi’s hands reflect those etched into red clay temples throughout the ancient city.  The details are ornate and the finished products fill the craft shops frequented by tourists and collectors.

Laxmi’s final product will sell for close to USD $100 but she’ll receive about USD $10 for the time that it takes her complete the statuette.  She buys her materials from a middleman to whom she will then sell the finished product minus the cost of materials.  Laxmi’s lack of capital keeps her at the bottom of the supply chain.

With a loan of Rs. 10,000 (about $135), Laxmi is able to purchase raw materials in cash.  She is able to buy materials at a lower price and in amounts that allow her to work on several pieces at a time.  By avoiding a debt with a middle man, Laxmi is able to sell her goods directly to store owners or negotiate better terms with other buyers.  Laxmi’s $10 take now doubles.

Laxmi’s seemingly small move up market is representative of a much more profound impact of the Girl Effect in Kathmandu.  In Nepal, women are denied access to bank capital because of a lack of collateral.  Without collateral, women operate at the edges of the economy, kept there by barriers of genders and tradition.  But with $135, Laxmi changes the rules.

Laxmi finds a strategic edge.  Laxmi makes the market more efficient.  Laxmi cuts out the middle man.

__________

Learn more about Kiva borrowers in Nepal here.

Invest in women like Laxmi here.

*Name changed for reasons of privacy.

Entry filed under: KF10 (Kiva Fellows 10th Class), Nepal, Patan Business and Professional Women (BPW). Tags: , , , , , , .

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6 Comments

  • […] Out the (Middle) Man Jun 152011blog By admin re blogged from: fellowsblog.kiva.org […]

  • 2. Ananda  |  8 November 2010 at 21:25

    Chris,

    I’m really interested in learning more about your fellowship with KIVA. I’m currently doing a semester of school in Kathmandu and I’m researching Newari communities and microfinance. Would you be willing to talk a bit about your fellowship and BPW Patan? My email address is borshaa@whitman.edu.

    Thanks!
    Ananda

  • 3. Claudine Emeott  |  22 September 2010 at 11:51

    Chris,

    I discovered your Kiva Fellow profile and would love to chat, as we share similar backgrounds. I went to Harvard and conducted my undergrad thesis research in KTM in 2003. I fell in love with Nepal then and have been figuring out ways to go back ever since. Now I am planning a more permanent move there and would love to continue my background in international development through a Kiva Fellowship with BPW Patan. I would really appreciate the chance to talk with you about your experiences.

    Sincerely,

    Claudine

  • 4. EDITH HOESLEY  |  26 August 2010 at 10:13

    I WOULD LOV TO ASK SOME QUESTIONS ??
    SIMPLY IF I LOANED SOME ONE 1000.00 HOW DOES IT WORK ?
    DO I GET THEMONEY BACK IN SO MANY MONTHS OR YEARS IS IT PAID MONTHLY OR YEARLY WHO PAYS THE INTEREST AND HOW MUCH WOULD I GET BACK OR IS IT ALL CHARITY

  • 5. monkeymonique  |  18 July 2010 at 20:35

    Last week I was in Nepal, and I observed the people there working so hard. Great blog about them!

    I’m looking forward to lending to Nepalise people soon.

    Cheers

    Monkey

  • 6. Magdalena  |  7 July 2010 at 16:48

    Great story. Well told. Thanks! (any pics of the statuettes?)


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