People of Bharat: Usman

Building a house without a loan

By: Simran Panesar & Valerie Mendonca

Usman Ahmed looks up from his sewing machine and greets me with a smile. He has been expecting me. He offers me a stool and instructs one of his ‘boys’ to fetch a glass of water for me. I sit down and take a look around this tailoring shop owned by Usman. Located in a rural area of Ludhiana in Punjab, it measures roughly 8 by 8 feet and has three sewing machines. Strips of cloth and other material are strewn on the floor while the finished clothes hang from a rod attached to one of the walls. Despite the scraps of cloth lying around, the shop appears to be clean; it has a tiled floor and walls that have been recently white-washed. Two teenage boys are busy with sewing at the two other machines; their whirring is louder than the tractors rambling by on the street outside. I spot a small window air-conditioner that is keeping the temperature low and therefore comparatively pleasant on this smouldering summer afternoon.

Usman is a tall, lean, dark-haired man in his late thirties. He is wearing a plain white kurta-pyjama which is frayed at the edges. He asks me if I am doing my Ph.D as students have previously interviewed him for their thesis research. I talk to him about the purpose of my visit and he willingly shares the story of his life. He speaks to me in Hindi, interspersed with Urdu and English words.

Usman was born in a village in Bihar to a family of traditional tailors. He learnt to sew male garments at home from his mother. He confesses he was not interested in sewing at first but learnt it under family pressure to join the ancestral profession. After completing his standard tenth exams, he learnt sewing for six months after which his jijaji (brother-in-law) brought him to Ludhiana in Punjab to learn kadhai (a traditional form of embroidery). ‘I was 17 when I came to Ludhiana’, he reminisces. After six months of working for his jijaji, he realised that kadhai was not for him. The work required him to be seated for 12 hours straight. Usman also worried that the continuous strain of working on the minute details of the art would affect his eyesight in the long run. ‘Nigah pe bahut zor padta hai’ (There is a lot of strain on the eyes.) After mustering some courage he finally spoke to his sister and said he was not interested in continuing with embroidery. ‘Maine kaha ki isme me survive nahi kar paaunga.’ (I told her I would not be able to survive in this profession.)

Usman had observed the rural fashion trends and noticed that mostly all women; young and old wore salvaar-kameez (a long shirt worn over loose pyjama-like trousers). He felt that women’s garments was a good business and he would never be out of work. He expressed his desire to learn to sew these to his sister. She supported him and he joined a small boutique as an apprentice to an ustaad (expert) tailor. He was paid Rs. 1,000–2,000 every couple of months, a major portion of which he sent back to his parents in the village. ‘In those days (in the year 1999), 1,000 rupees was a big amount,’ he says with a hint of suppressed pride. Usman bought a small kuccha house and in 2007 asked his family back in the village to move in with him as his father had quit work because of back pain. ‘Jab main hi ghar chalaunga to do jagah chalane se accha hai ek hi jagah se chalaya jaye.’(If I am going to run two households, it always makes more {financial} sense to do so from one place). At this point his father’s health rapidly deteriorated due to a misdiagnosed tumour; leading to a lot of expenses and his eventual demise a couple of years later.

Usman normally worked from home but an incident pushed him to open his own shop. One day his young children ruined a customer’s cloth while playing. Usman was very angry at his kids and scolded them heavily. Later, regretting his anger, he realised that if he wanted to work without distractions, he would need to move his business out of his house. He started searching for shops and eventually moved in to the current premise with his sewing machine. ‘I don’t earn too much, but at least it (income) is regular. The women here are loyal customers.’ He was able to buy two more sewing machines, out of his business profit. Currently he owns three machines which he claims are more than sufficient for his business needs.

Usman used Rs. 4 lakhs of his savings to support his younger brother’s education who has just completed a degree in engineering from Chandigarh University. At present his brother is applying for jobs abroad. ‘I have invested in his education but I can’t expect for guaranteed returns,’ he says. ‘Whether my brother will send us money or not in the future is another matter altogether.’

Usman makes Rs. 30,000 every month out of which he spends Rs. 9,000 on groceries, bills and utilities. His children study in a sarkaari (government) school free of charge. In the past he saved whatever he could with a neighbourhood chit-fund. In the past five years Usman has been renovating his kuccha house. He spends approximately Rs. 21,000 every month towards construction work; buying cement, bricks, paying labourers, etc; leaving nothing to save. ‘Today I have just returned from buying the doors for the house’ he says. Usman has a bank account and has been trying to avail a housing loan for a long time. He tells me he has made several visits to banks; both public and private. ‘If I go to a private bank, they tell me to go to a sarkaari (government) bank. When I go there (government bank), they shoo me away.’ His frustration is apparent, as he shows me a file full of carefully arranged documents and receipts. I am surprised he has all the documents at his shop but Usman tells me he carries the file wherever he goes. To prove his credibility to banks, Usman started using a credit card. He uses it judiciously and has a credit score of more than 800 points. He also has the required documents needed to avail a loan. Despite all this, no bank is willing to lend him money. ‘I have borrowed a total of Rs. 60,000 from my friends. They have been generous. But there is a limit to begging/asking.’ Usman has even tried approaching a government lending scheme for affordable housing but it just added to his list of disappointments. ‘I have given up on the government and the banking system. They only make you go around in circles and waste your time.’ Usman feels the only other option is to work harder and use his monthly savings to pay for the construction of the house. He also feels that expanding his business is difficult in the rural area as demand is very limited.

Usman has extensive knowledge about government loans for micro and small enterprises. Despite this, he has been unable to secure a loan. He has a smartphone on which he gets calls from private banks almost every day. At first these calls would offer him a ray of hope, but he would quickly lose interest when they disclosed their interest rates, terms and conditions. ‘Once they called to tell me that I had availed a loan. I was so happy, until they told me it was for only four thousand rupees. Are they trying to make a fool out of me?’ The bank told him that this was the maximum amount allocated to businesses such as his.

I enquire about the tiny, stuttering air-conditioner in a corner of the shop. Usman’s smile reaches his eyes as he says, ‘This is the one thing that I bought solely for myself. The cloth keeps flying in the fan’s breeze and working the whole day in this weather is hard. To work well, one needs to be comfortable.’ I ask him about the two young boys who appear to work for him. ‘Their families are poor, and they needed work. I taught them whatever I knew about stitching and now they’re nearly as good as me. I pay them Rs. 2,000 rupees each every month.’

Usman tells me his children are performing competently in mathematics and science subjects at school. He hopes they take after their uncle in their studies, and aspires to get them educated from one of the IITs in India. I have a feeling Usman derives immense personal satisfaction from being the sole bread-winner supporting a family of seven. His mother, wife, brother and children all live together in his three-room house. As I get ready to leave, I compliment him on his grit and tenacity in running his own business. He replies by saying, ‘I am just trying to make life better for myself (and my family). It’s everyone’s right, isn’t it?’


About the Author:

Simran Panesar is an economics student at Miranda House, Delhi. Her research interests include legislation, economic policy and child health.

Valerie Mendonca is a Research Associate at CIIE.CO, India’s foremost entrepreneurship centre housed at IIM Ahmedabad. Her research interests are women, entrepreneurs, society and storytelling. She tweets @ValerieHood17.

About Bharat Inclusion Initiative (BII):

Bharat Inclusion Initiative (BII) is an incubator platform at CIIE.CO that provides entrepreneurs the domain knowledge, training, financial support, mentorship, and market access they need to bring inclusive, for profit-business to life. BII’s core design is to promote technology-driven entrepreneurship towards the delivery of affordable services to the “Bharat Segment- the poorest 200 million households in India who survive on less than $5 per person a day” through programs, fellowships, and funding where possible.

The program focuses on solutions leveraging technology, especially the India Stack. It integrates financial inclusion research with entrepreneurship and training to transform these solutions into scalable, viable and high impact businesses. We are keen on partnering with entrepreneurs who are driven by building next-generation digital services for India. Reach out to us at bharatinclusion@ciieindia.org or ask your questions in the comments section below.

BharatInclusion

Bharat Inclusion aims to build knowledge, foster innovation & entrepreneurial activity towards improving financial inclusion and livelihood for the poor.

Bharat Inclusion Initiative

Written by

We aim to build knowledge, foster innovation & entrepreneurial activity towards improving financial inclusion and livelihood for the poor.

BharatInclusion

Bharat Inclusion aims to build knowledge, foster innovation & entrepreneurial activity towards improving financial inclusion and livelihood for the poor.

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