This study was carried out for Water.org – a US based non-profit organization committed to providing safe drinking water and sanitation to people in developing countries. The study was carried out to undertake an assessment of potential market for watercredit in three north Indian states – Uttar Pradesh, Bihar and Uttarakhand.
The following were the key objectives of the study
- To assess key demographic characteristics and understand water and sanitation status and coverage.
- To estimate demand for watercredit products
- To assess the capacity of the MFIs and WSH expertise available to scale up water credit
- To identify constraints in scaling up
The study involved literature review, primary survey of about 1,200 respondents in 15 districts (400 respondents across 5 districts in each state), 15 Focus Group Discussions (FGDs) with about 250 residents in urban and rural areas and discussions with MFIs, NGOs and experts in water and sanitation.
For the purpose of this study, the following water credit products were considered
- Credit for improved water source: Households may be offered credit for investing in an improved water source like a piped water connection, handpump or borewell.
- Credit for improved toilets: Households may be offered credit for constructing improved toilets within their premises.
- Credit for purchasing water purification appliances: Households may be offered credit for purchasing water purification appliances.
For estimating demand, we considered proportion of population not having access to water and sanitation facilities, average loan requirement for different products and willingness of people to take loans for water and sanitation purposes.
We identified key challenges for the MFIs in providing microcredit products and suggested way forward for scaling up water credit products.