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Sumitra: bottle capping in india

Sumitra, a mother of two children, lives with her husband in Ahmedabad, the largest city in the state of Gujarat, and the seventh largest in India. Nearly half of the city population lives in low-income settlements or “chawls”—one-room row houses—in unhygienic and dilapidated conditions.

Sumitra runs a bottle cap recycling business. In India, the majority of soft drinks are packaged in glass bottles with metal caps. Several years ago, Sumitra began roaming the streets collecting discarded caps which could be sold to middlemen who, using a specialized machine, straighten the caps and sell them back to soda manufacturers, such as Coca-Cola, Pepsi, and some popular local brands.

In the course of her collecting business, Sumitra learned about Vikas Center for Microfinance Development, which in addition to offering a variety of financial services, encourages women’s empowerment through economic activity by sponsoring self-help groups for poor entrepreneurs in urban and rural areas of Gujurat and neighboring states. Vikas, which has been in operation for 30 years, is one of the oldest clients of WWB Network member Friends of Women’s World Banking, India (FWWB). FWWB provides financial and capacity-building support to organizations such as Vikas which promote the economic self-reliance of poor women.

Four years ago, Sumitra joined one of Vikas’ self-help groups in her modest housing settlement, and was encouraged to expand her business. Through her collecting business, she had learned that a bottle cap straightening machine, which cost 2000 rupees (about USD50), would enable her to straighten the caps herself and sell the straightened caps directly to the manufacturer.

In order to make the business as profitable as possible, Sumitra formed a group with five other women bottle cap collectors, and with the self-help group as guarantor, applied for one of Vikas’ “Karma” economic activity loans. These loans are provided for the purchase of equipment and for working capital at interest far below the exorbitant rates charged by moneylenders.

Sumitra received a loan of 50,000 (USD1,240) rupees to cover the cost of six bottle cap straightening machines (one for her and each of her five employees) plus working capital for the business. Since then, Sumitra has taken out three more loans to further develop the business, which she has paid back out of the business profits. Sumitra and her employees straighten 50 kilos of caps per day; Sumitra makes approximately 500 rupees profit (USD12.42) per month after paying the salaries of her employees, who are paid two rupees per kilo of caps straightened. This may not seem like a lot, but to Sumitra, her employees, and their families, it represents security and hope.

Sumitra’s profitable business has enabled her to greatly improve the living conditions of her family and those of her employees. The business has also literally been a life-saver for Sumitra’s family. Sumitra’s husband became ill during the flu epidemic that accompanied a 2006 monsoon, and was in desperate need of medication. Without her income, Sumitra would not have been able to afford the medicines that saved her husband’s life. The business has also enabled Sumitra to help her son get started in his own business, and to finance her daughter’s education. Sumitra’s daughter is now in her first year in college, studying finance.