By Rahul Sinha

Not so long ago water scarcity in Cape Town city of South Africa made it to headlines of national and international dailies across the world, unfortunately, what remained in obscurity was that India has highest number of people without access to safe drinking water. A total of 75.8 million live without access to safe drinking water and unarguably most of them belong to the impoverished section of society. Lack of access to safe drinking water often causes waterborne diseases resulting in high infant mortality and exorbitant health expenditure; often borrowed from loan sharks actuating the households in the poverty trap. Gender dynamics also plays huge role, with women facing the wrath more often than men folks. Fetching water for most of the households is responsibility of women and drudgery faced by themis nerve-racking.

Microfinance through various WSS products has long been trying to address this issue by providing microcredit for safe water access for households and there is a growing recognition of its potential to improve access of safe water.Like any market-based approach, product design remains critical for WSS products too and often found ill-suited for the needs of lower income segments.

Grameen Foundation India undertook a study, ‘Rapid Needs Assessment for WASH facilities for Women + Water Alliance’, in select districts of Madhya Pradesh in 2017-18. Districts covered under the project were Dewas, Dhar, Indore, Khandwa and Sehore. The study used qualitative research methods to map the demand and supply side of Water Supply and Sanitation(WSS) products and explore feasibility of WSS products in the area.

Research findings suggested that safe water access and water quality were major issues in the area, faced mostly by the impoverished communities. Inequity in access to the water sources was widespread, many of the well-off households owned multiple water sources.Water scarcity was rampant in many of the districts and all of them had long dry summer months.The water crises also have an adverse effect on usage of toilets which are getting constructed in large numbers, but households do not have enough water to use these structures. The research study identified following gaps in the present situation:

Not all seems lost for the community and members harbour aspirations of having access to regular water supply and clean drinking water sources which would put an end to the drudgery involved in fetching &storing water and struggle with water-borne diseases. The gaps in access to safe water when coupled with the aspiration levels of the community members presents a huge opportunity to the financial service providers for a strong double-bottom lineperformance. Repayment rates of WSS loans have been about 99{bfd0b5b52bb77a6f8ada0901106534875092d790f4bffd43f90a9d1e4335d035} across the globe though 80{bfd0b5b52bb77a6f8ada0901106534875092d790f4bffd43f90a9d1e4335d035} of the borrowers earned less than $2 USD per day.

Currently, a few financial service providers are offering credit for water infrastructure and management purposes in these select districts.These institutions have experienced lukewarm response from clients for such products. Most of the MFIs offered loans for water filter and borewell/handpump for enabling safe water access to these households. Both of these products faced uptake challenges amongst the low-income households. Lack of appropriate low-cost technology, limited perceived benefits, unavailable maintenance support and erratic electricity supply in rural areas were key constraints.

For water cleaning products, a multi-thronged approach should be employed with strong promotional strategy. Some of the key consideration for success of water filter as financial product are:

1. Segmented Approach – The study clearly highlighted that due to lower awareness levels and lowerfungible income, select strata within the low-income segment with higher income level can be targeted during promotional campaigns for higher uptake. Poverty measurement tools such as PPI could be leveraged for adopting a science-based approach for product targeting.
2. Low cost Appropriate Technology – Current products in the market were not suited for many of the regions facing issues such as high fluoride contamination or high TDS content. Irregular power supply and poor maintenance facilities available in the rural areas also contribute to the poor uptake of the product. Low cost technologies addressing these pressing problems should be marketed for improved uptake.

Typically, the demand of loans for water access was found to be higher amongst community members due to scarcity of water, especially in summers. Though, due to depleting water table, borewells are considered as a risky financial product. Question of ‘what if the borewell fails to get water’ looms large and results in limited product marketing by the MFIs as well as poor demand at community level. Though, the product remains highly viable at locations with good water table.

To counter the unviability of individual borewell loans in water scarce area, community focused rainwater harvesting loans could be tested. These loans could be distributed through the typical JLG/SHG model. Alternative channels such as NRLM, NABARD or NGOs could also be explored for the viability of such a product. As, inequity in access to water resources was rampant and upper segments of lower income households mostly had access to water. The product remained highly relevant for the lower strata of the society especially in rural areas.Access to safe water remains a key requirement for any household and ways to address the access issues are need of the hour to mitigate social and economic costs due to lack of it.