How to Increase Formal Savings for the Papad-Makers of Dharavi Slum

This post by Mudita Tiwari and Deepti KC.

In Dharavi, Mumbai, the largest urban slum in Asia, groups of women make papad, crispy lentil dough wafers, for Lijjat Papad Company, one of the world’s largest papad retailers.  Lijjat requires any woman who works for the enterprise to first open a savings account, and to encourage savings, the company deposits a small proportion of the women’s earnings (2 rupees of every 32 rupees earned) directly into the savings accounts, adding a bonus during the Diwali festival.

Funded by a grant from Institute for Money Technology and Financial Inclusion at the University of California, Irvine, we interviewed 25 of these women entrepreneurs.  In our research, we wanted to understand whether the women, accustomed to a traditionally cash economy, would continue to use cash now that they had access to banking services like brick-and-mortar branches, ATMs, credit and debit cards and checks, and which cultural and economic factors influenced their preferences.

Saving Under the Mattress, but an Interest in Banking Services

Despite having ‘active’ bank accounts, all women reported cash as their primary mode of payment for business and personal transactions. All of the women perceived handling cash as safer and more convenient, and carried cash for transactions at all times. Only one in three women reported conducting bank transactions, and when they did, it was with the help of male members of the household, primarily adolescent children or husbands. We found all of the women using higher-risk and unregulated savings options such as chit-funds (a regional variant of a savings group crossed with a lottery), or hiding money at home. With husbands often spending household savings on gambling or addictive substances, women showed us their strategies to hide away cash in food jars, piles of clothes, and among beauty supplies. Two in three women reported disputes within the household because of interpersonal theft, often resulting in domestic violence.

Women in our study made an average income of 5,030 Rupees (approximately 83 USD) per month. Three in four women stated that although cash was their preferred mode of transaction, they were interested in using banks more actively for their savings needs. During our many focus group discussions with 5-7 women, we found that women (i) felt inhibited interacting with male staff at the banks; (ii) felt they needed to consult with men and older male children in the household to make financial decisions; and (iii) were unaware of the banking products and services available to them.  Previous studies, including this one from Ghana, corroborate these findings.

Recommendations to Increase Take-Up

Previous research (for example here) finds that on average women have excellent repayment rates and are disciplined savers.  Despite financial inclusion initiatives by the government, only 26% of female adults in India have an account at a formal financial institution, compared to 44% male adults.  If financial service providers want to take advantage of this potentially profitable customer base, they should address the barriers that the women in our study described.

First, to address women’s reluctance to work with male tellers, we recommend Dharavi banks hire more female staff (in our visits to banks in Dharavi we observed almost all male banking agents). Initiatives like gender sensitive training and workshops can  build gender awareness among all staff, including men.

Second, to combat the perception that women do not make important financial decisions in the family, we recommend financial providers promote gender-inclusive advertising by highlighting the importance of women as financial decision-makers. Current ads often show women as secondary actors standing behind men, with men in charge of finances. A survey conducted by the Media Post reported 91% of women feel advertisers do not understand them. Banking advertisements showing women entrepreneurs taking loans from banks for their businesses, or depositing savings in banks for their children’s education may encourage women to use banking services more actively.  One positive example of such a promotion is by the State Bank of India, which is advertising “Her Ghar” (Her House) to encourage women to invest in special interest home loans for women. We recommend banks distribute brochures and run advertisements in local newspapers to increase awareness about available products.

Lastly, to tackle women’s lack of knowledge about financial services, we see the need for financial literacy materials that focus on women’s specific savings needs. To this end, we are developing a series of comic books using an interactive storytelling approach. The comic books employ relatable characters (women entrepreneurs working and living in familiar surroundings) who face problems of financial indiscipline (mainly due to having cash in hand), inertia and lack of financial awareness, and suggest solutions to reduce savings inertia over the long-term. The comic books will be distributed to service providers who can distribute the books to their clients, or directly to women entrepreneurs and their husbands and children.

In sum, helping women save with banks requires addressing both the psychological constraints women face, and their financial knowledge gaps. Banking institutions are poised to play a critical part in eliminating these constraints. In parallel, gaps in financial knowledge need to be addressed through context-specific, easy-to-understand financial literacy materials distributed directly to women and their families, and through financial service providers.


Mudita Tiwari holds a Master's in Public Policy and a Master's in Public Health (Epidemiology/Biostatics) from the University of California, Berkeley, and a B.B.A in Information Technology from Cleveland State University. At CMF, she is working on research evaluating the impact of microfinance, financial inclusion, financial literacy programs, and agricultural financing programs in the states of Uttar Pradesh, Bihar, Maharashtra, Punjab, Tamil Nadu, and West Bengal.

Deepti KC has a Bachelor’s degree in Civil and Environmental Engineering from the National Institute of Technology (NIT) – Jaipur and has a Master’s degree in Environmental and Public Health Engineering. She also has a Master’s degree in Fundraising Management and Nonprofit Administration from Columbia University.  Deepti currently works as a Senior Manager and is involved in carrying out several research projects relating to financial inclusion.


All photos courtesy of the authors.