Voices of Distress and Resistance: AIDWA’s Public Hearing on Women and MFI Loot
Mariam Dhawale
ON August 23-24, 2025, more than 500 women from across India gathered at Surjeet Bhawan in New Delhi to tell their stories of debt, despair, and defiance. The ‘National Public Hearing on Women’s Rising Indebtedness and Micro Finance Institutions (MFI) Loot’, organised by the All India Democratic Women’s Association (AIDWA), became a platform where the silent burden of loans, harassment by MFIs, and the failure of public banks erupted into a collective cry for justice. It was not just another programme. With voices trembling yet resolute, women laid bare how financial institutions, once touted as engines of empowerment, have pushed them deeper into debt, poverty and humiliation. They described how debt has crept into every corner of their lives. Everyone was forced to listen to these voices which are often ignored!
Over the past decade, MFIs and non-banking financial companies (NBFCs) have expanded aggressively into India’s villages and small towns. Marketed as instruments of women’s empowerment, these loans now function more as debt traps.
The national public hearing was the culmination of a year-long national survey conducted by AIDWA across 100 districts in 21 states, engaging over 9,000 women. The objective of this hearing was to amplify the voices of affected women, expose institutional injustice, demand policy changes, and strategise AIDWA’s campaign roadmap. The findings revealed a harsh reality and painted a grim picture: public sector banks routinely turned women away, forcing them into the clutches of MFIs and NBFCs that charge exorbitant interest rates and use coercive recovery tactics. “When public banks refuse us, the microfinance companies are waiting at the door. But their loans are a trap, not a lifeline,” said Ayesha Nadaf from Maharashtra at the hearing. This hearing offered a platform to present the data of this survey and hear firsthand narratives from affected women.
They came with stories of indebtedness, harassment, humiliation, and resilience. Many spoke publicly for the first time about the unbearable pressure of microfinance loans and the daily indignities of dealing with collectors. Their testimonies tore apart the myth that microfinance has been an “empowering” force for women.
The jury comprised of former Supreme Court Justice Madan B Lokur, eminent economist Professor Prabhat Patnaik, independent journalist Pamela Philipose, former general secretary of the All India Bank Officers' Confederation (AIBOC) Thomas Franco, and Advocate Kirti Singh. The national public hearing was also attended by representatives of NABARD employees’ union and other eminent citizens. AIDWA president P K Sreemathi presided over the proceedings and AIDWA general secretary Mariam Dhawale in her introductory speech welcomed the participants.
DEBT & DISTRESS
About 60 per cent of the surveyed women were from rural areas; over 40 per cent were adivasis or dalits; around 21 per cent were from minority communities; and 15 per cent were single or widowed. These are communities which are historically denied access to institutional credit. 70 per cent of them had a household income under Rs 10,000/month; 90 per cent under Rs 30,000. This showed the vulnerability of the women.
The survey showed that public sector banks are shutting their doors to the poor, leaving MFIs as the only option. Interest rates of 22-26 per cent charged by MFIs have become the norm, with women borrowing from multiple lenders just to stay afloat. 32 per cent had taken loans from over three companies; 60 per cent from more than two, showing the helplessness of women victims of multiple loans. Over one-third carried debt above Rs 50,000, while 40 per cent reported loans between Rs 1 lakh to Rs 2.5 lakh.
Nearly 50-60 per cent of women had to pledge personal belongings like jewellery, house documents, Aadhaar cards though the MFIs lure them saying that no collaterals would be required for the loans. Women are forced to pledge every small belonging – from bangles to ration cards – in desperation. Most loans were taken for food, education, health care, and housing – bare essentials that should have been covered by welfare systems. Most of the women had scant access to government aid or schemes.
Public sector banks – mandated to serve the poor – have increasingly denied small loans to women, citing collateral and paperwork requirements. Cases of extreme distress were shared before the jury. “We did not take loans to start businesses or get rich. We borrow to survive, not to thrive. We borrowed to buy food, to pay school fees, to keep the lights on. How can survival come with such crushing interest?” asked G Latha from Tamil Nadu, her words echoing the testimonies of many.
Harrowing experiences described in the survey included verbal abuse, physical assault (5 per cent), sexual threats, forced seizure of goods (10 per cent), and persistent harassment through calls, etc. “Collectors came into my house, shouted abuses, and threatened to take away my roof. Is this what women’s empowerment looks like?” asked Pushpa Nayak from Odisha, drawing murmurs of solidarity across the hall.
The stories in the testimonies were painful. Women spoke of loan collectors barging into their homes, shouting abuses, threatening to seize belongings, demanding repayments in front of neighbours, and humiliating families. Many recounted physical assaults and sexual harassment; others described the unbearable stigma of being branded “defaulters.” In one case, a grandmother ended her life under mounting debt pressure. Families skipped meals or stopped sending their children to school to repay debt. Women were forced to hide inside their homes while collectors waited outside.
SYSTEMIC FAILURES AND STATE NEGLECT
19 testimonials recounting their tragic experiences were presented by women from West Bengal, Karnataka, Maharashtra, Tamil Nadu, Madhya Pradesh, Odisha, Puducherry, Bihar, Tripura, Haryana, Andhra Pradesh, Madhya Pradesh, Uttar Pradesh, Rajasthan and Punjab. AIDWA joint secretary Tapasi Praharaj moderated this session.
These were not isolated incidents but part of a wider pattern of intimidation and coercion “This is not just individual suffering – it is a structural crisis created by State withdrawal and financial deregulation,” said one of the jury members, summing up the testimonies.
The relentless pursuit and threats from recovery agents caused stress and violence within debt-ridden families across states. These stories illustrated how microfinance has morphed into systemic abuse of the most vulnerable.
It is a scandal that MFIs are allowed to thrive in the vacuum created by the withdrawal of the public sector banks lending to small borrowers, particularly women from dalit, adivasi, and minority communities. At the same time, deregulation has given MFIs near free rein. Add to this the chronic underfunding of health, education, and housing, and indebtedness becomes inevitable. It is a bankrupt political failure of the State. When survival depends on borrowing at predatory rates, the system itself is rigged against the most vulnerable.
On the morning of August 24, an important session was held on alternative models of microcredit. Rana Mitra, general secretary of the All India NABARD Employees’ Association gave a very good presentation on the challenges faced by NABARD, and how joint struggles should be waged so that women could get safe and affordable credit. Thereafter Gino Bai, general secretary of MALAR association, Kanyakumari, explained the ways in which the women had built an SHG movement in order to provide alternative credit options to women. The MALAR association has now survived for 30 years as a democratically run SHG federation of women which had expanded its operations to help in accessing affordable credit.
The third model presented was of the Kudumbashree Mission of the LDF government of Kerala which had grown into a big movement. Jiji Prasad from Alappuzha explained how she was transformed from a helpless woman with lot of difficulties into an extremely successful award-winning entrepreneur. Her presentation showed that if there is a political will then the state can make provisions for free and affordable credit and transform the life of women. T N Seema from the Kudumbashree Mission gave an overall idea of the growth and challenges before the mission. She highlighted the need for joint campaigns to spread the lessons from the Kudumbashree model and protect the women from oppression of NBFCs-MFIs.
All four presentations highlighted how the alternative models have been able to save the women from oppressive practices of the NBFCs-MFIs.
REMARKS OF JURY
The members of the jury gave their observations in the last session. All jury members congratulated the AIDWA for holding the national public hearing. They agreed with the conclusions of the report and were distressed after hearing about the reported cases of suicides, sexual and physical assaults, and other forms of oppression from the testimonies of the women. They all lauded the courage of women and said that this national public hearing had given them hope. Jury members also made remarks about the future course of action.
Justice Madan Lokur suggested that AIDWA should wage local level struggles to ensure that the RBI and the government strictly regulate the MFI sector. He suggested that women should avail of the free legal aid services in all districts to put up a fight against the harassment and oppression of the NBFCs-MFIs.
Professor Prabhat Patnaik’s suggestions included specific demands for low interest loans for women borrowers. He stressed on the inclusion of women-headed households or single women in priority sector lending at 4 per cent interest rate and waiving of outstanding loans that amounted to more than twice the annual household income through government guarantees. He demanded that a law should be enacted to ensure ceilings on interest rates. Steps should be taken to transfer 25 per cent of RBI surplus to NABARD in order to strengthen the SHG-Bank Linkage Programme. He suggested that the RBI should ensure that the public sector banks provide loans to women on production of Aadhaar and PAN Cards instead of seeking collaterals. Prof Patnaik agreed with the AIDWA demand that NBFCs-MFIs should be removed from priority sector lending and public sector banks should stop giving them loans.
Thomas Franco, while agreeing with all the observations made above, outlined his vision for a future campaign. He stressed the importance of increasing the branches and staff of public sector banks to expand the outreach of these banks. He suggested that a demand be made for doing away with the CIBIL scores for loans that are below Rs 5 lakhs. Franco also suggested a joint campaign on financial literacy with the bank unions. He proposed that AIDWA should contact other women’s organisations and build a strong public campaign against NBFCs-MFIs.
Pamela Philipose highlighted the importance of integrating economic and social issues in the women’s movement, and congratulated AIDWA for showing the way. She suggested that the message of the national public hearing should be spread through innovative methods.
Advocate Kirti Singh emphasized that the actions of the RBI are unconstitutional as they violated the Right to Life. She also suggested that pressure should be brought on the state governments to control activities of NBFCs-MFIs.
The two-day hearing ended with resolve and hope. The public hearing was not only about exposing suffering – it was also about building a movement for change. It concluded with a resolute call to action: AIDWA has demanded strict regulation and accountability of NBFCs-MFIs to end exploitative practices; caps on interest rates and curbs on coercive collection practices; loans at 4 per cent interest rate from public sector banks; accessible and affordable loans from public sector banks, especially for women from marginalised communities; grievance redressal mechanisms and legal protections for the women; strengthening public welfare systems so families need not borrow for food, health, education, or shelter; increase the budget and spend more on welfare schemes.
AIDWA general secretary, Mariam Dhawale welcomed the suggestions made by the jury and assured them that AIDWA will build a strong and united public campaign against these loan sharks. She also placed the charter of demands. The hearing concluded with the address by AIDWA president, P K Sreemathi. AIDWA joint secretary Asha Sharma gave the vote of thanks.
AIDWA will conduct a national level signature campaign on the demand charter, submit memoranda to district collectors, hold state-level public hearings and mobilise mass support with like-minded organisations to pressure policymakers and financial institutions for reform.
The national public hearing was more than an event – it was a testimony of collective resistance. By bringing women’s voices to the national stage, AIDWA underscored that the crisis of indebtedness is not just about numbers but about dignity, survival, and justice.
As the women dispersed from Delhi back to their towns and villages, they carried with them not only their burdens but also the hope and power in their collective voice. It was an affirmation: when women speak together, they can turn pain into power, and silence into struggle. India’s poorest women are being pushed into a cycle of debt from which there is no escape, unless the State intervenes. Their voices should echo in Parliament, in financial institutions, and in every policy corridor until action is taken. The message from the hearing was loud and clear: credit must empower, not exploit. Loans should be tools of dignity and progress, not chains of humiliation and despair.
The significance of the hearing lies in what it represents: the transformation of individual suffering into collective struggle. For decades, women’s unpaid labour and resilience have subsidised India’s economy. Now, they are demanding that the burden of debt be recognised as a political issue – one that requires systemic change, not individual sacrifice.
By documenting exploitation and amplifying women’s voices, AIDWA is building the foundation for a broader struggle against financial loot. The women who returned from Delhi carried with them not just their debts, but also the power of solidarity and the determination to fight back. This hearing marked a new phase of AIDWA’s struggle: from documenting exploitation to mobilising against financial loot.
