In 1974, approximately 4,000 self-employed women in India each contributed ₹10 to launch a cooperative bank in a bold effort to achieve economic independence. At the time, these women typically had no access to formal credit, no secure place to store their savings, and were often subject to exploitative moneylenders. Their modest yet radical act of pooling small amounts of capital created what is now the Shri Mahila SEWA Cooperative Bank, a powerful financial institution that remains a lifeline for thousands of poor, self-employed women across India.
Today, on the International Day of Cooperatives, it is worth revisiting what makes SEWA Bank not just a successful banking model, but a revolutionary example of how institutions run by collectives, for collectives, can drive “Inclusive and Sustainable Solutions for a Better World”—the theme of this year’s celebration.
Inside SEWA Bank’s Cooperative Approach
A cooperative bank differs from other financial institutions due to its member-owned, democratic structure, which facilitates its focus on community welfare over profit maximization. Unlike commercial banks that operate in the interest of external shareholders, cooperative banks are owned and governed by their members, who are often the same people who use their services. Profits are thus typically reinvested back into services that benefit the members, such as providing lower interest rates and better loan terms or offering community development initiatives such as financial literacy and digital banking workshops.
SEWA Bank exemplifies the core strengths of a cooperative model built on principles of solidarity, mutual aid, and local accountability. It operates on a savings-led model that turns the typical microfinance script on its head. Rather than offering credit as the primary entry point, SEWA prioritizes savings as the first step toward financial resilience. Members begin only by contributing deposits, marking not only a practical tool to sustain the institution but also to cultivate ownership, discipline, and dignity among women members.
Perhaps SEWA Bank’s most defining innovation is the Banksathi (literally, “bank friend”) model. These ‘loan officers’ are not outsiders but neighbors, fellow workers, and trusted confidantes of other women members; people they can turn to for support and rely on without hesitation. Selected from within the community, Banksathis are trained in financial counseling and supported by bank facilitators to serve as a vital bridge between SEWA’s services and the lived realities of rural and urban informal women workers. Each Banksathi maintains a fixed deposit of ₹15,000 in SEWA Bank, which acts as a security deposit that serves as a safeguard against misappropriation while also signaling shared responsibility. Each Banksathi typically serves up to 400 borrowers, earning a commission while continuing her own trade or livelihood. Unlike conventional loan officers, she brings banking to women’s doorsteps and maintains a personal connection with her clients, ensuring no one is left behind in the shift toward digital services. This trusted relationship also enables her to lead financial literacy sessions and inform the bank about where additional support or education is needed in member communities.
SEWA Bank’s approach to digital inclusion builds on this foundation of community-based, personalized support, continuing its commitment to accessibility and care. Women members receive hands-on training in the use of ATMs, UPI, and mobile banking apps from Banksathis in their home communities. The transition to digital tools is designed to be gradual, responsive, and grounded in familiarity rather than fear. These technologies are introduced not as replacements for in-person service, but as tools to build confidence and expand market access while still accommodating members who prefer analog methods. Although SEWA plans to digitize aspects of the Banksathi role, the focus remains on preserving human connection, ensuring that digital tools enhance, rather than displace, the trusted relationships and local knowledge that define the bank’s model.
SEWA Bank has built a comprehensive financial ecosystem that responds directly to the lived realities of India’s informal workforce, where over 96% of women are employed as vendors, domestic workers, artisans, or small-scale service providers. Its loan products are intentionally flexible, allowing women to use funds for a variety of practical purposes, such as purchasing tools, repairing homes, paying school fees, or covering medical expenses. Complementing this are tailored insurance schemes, pension plans, and a diverse set of savings options that address the full life cycle of women’s financial needs. Rather than imposing a one-size-fits-all model, SEWA’s financial offerings are structured around the specific economic rhythms and vulnerabilities of informal labor, enabling women to build financial security on their own terms.
SEWA Bank thus does not function by evaluating a woman’s ‘creditworthiness’ in the conventional sense, but rather operates in a manner that asks: What support does a woman need to become financially literate, confident, and ready to take on a loan? This approach transforms the bank from a transactional service provider into an enabling institution.
SEWA’s work has also extended well beyond banking. Recognizing that economic empowerment cannot be separated from legal, social, and structural justice, SEWA has filed over 100 lawsuits on behalf of working women, demanding rights ranging from workplace safety to social security. It has organized protests, connected women to legal aid and healthcare, and consistently pushed for policy reforms that reflect the needs of the informal workforce. In this way, SEWA Bank is far more than a cooperative financial institution, it is a tool for livelihood advancement and collective empowerment. Every aspect of the bank’s services is designed to be understandable, transparent, and accountable to the communities they serve.
What SEWA Can Teach Us About Building Inclusive Economies
SEWA Bank’s model is not just replicable, it is instructive for a global economy in which too many women remain excluded from formal financial systems. As we consider what truly drives inclusive and sustainable solutions, SEWA offers a working example of a model built not on scale or speed, but on care, context, and long-term commitment.
At the heart of the bank’s success is trust. Peer leaders—Banksathis—emerge from within the communities they serve. They assess creditworthiness not through rigid criteria, but with an understanding shaped by shared experience. Relationships, rather than risk scores, define how financial decisions are made and supported.
SEWA’s savings-first approach repositions women not as borrowers in need of rescue, but as active participants in their own financial growth. Building savings before extending credit fosters both agency and discipline, enabling women to approach financial decisions with greater stability and confidence.
The bank’s suite of products (ranging from housing loans to insurance schemes) is also designed with an awareness of the everyday and long-term realities of informal workers. Financial services are tailored not to abstract markets, but to actual lives.
SEWA’s work extends well beyond the realm of finance. Legal aid, protest support, childcare services, and literacy initiatives form an integral part of its broader programmatic ecosystem. Finally, just as importantly, SEWA reinvests in the collective through financial and digital literacy trainings, grassroots organizing, and cooperative education. These efforts equip women not only to navigate existing systems, but to actively shape and challenge them. Far from being peripheral, such services are central to SEWA’s institutional model, grounded in the recognition that true empowerment is rarely achieved through credit alone. Social and structural support are equally essential.
For institutions seeking to design truly inclusive financial programs, SEWA Bank offers a model rooted in cooperation over competition, dignity over charity, and human connection over automation.
As we mark the International Day of Cooperatives, it is worth returning to the words that helped launch SEWA’s journey: “We may be poor, but we are so many.” That refrain remains both a reminder and a call to action, underscoring that inclusive economies do not begin with institutions alone, but with the people they serve: by trusting them, organizing with them, and building systems that reflect their realities.
References
International Co-operative Alliance. (2025, May 12). Theme announced for CoopsDay 2025: Driving inclusive and sustainable solutions for a better world. ICA. https://ica.coop/en/newsroom/news/theme-announced-coopsday-2025-driving-inclusive-and-sustainable-solutions-better
International Co-operative Alliance. (n.d.). CoopsDay. https://www.coopsday.coop/
Shri Mahila SEWA Sahakari Bank Ltd. (n.d.). Trainings. https://www.sewabank.com/trainings
