Tourism in the Mount Everest region of Nepal can cause unintended consequences and significant socio-economic disparity. While tourism may bring higher daily wage rates for porters and casual workers, it also causes inflation and is highly dependent on the season. This situation worsened during the COVID-19 pandemic when the tourism industry collapsed. Furthermore, indigenous and minority communities like Rai and Dalits are often the first to be excluded from the economic opportunities that international tourism presents despite living and working in the region.
Families in the Mount Everest region of Nepal face three primary challenges, including:
Many of the families in this region have low financial literacy and only 45% of the adult population in Nepal has a bank account (World Bank Report 2017). Basic financial literacy is crucial to managing finances within the household. This includes learning to prioritize or save for essential items, learning to make longer-term plans and delineating between personal and business money. However, the combination of irregular income and a lack of access to financial literacy education can leave these families vulnerable to unsafe or high-interest loans and an endless cycle of debt. In turn, running and managing profitable or sustainable businesses becomes nearly impossible.
“Ensuring a greater deal of financial literacy in Nepal will require the active engagement of three parties,” Mimu Raghubanshi, Good Return’s Nepal Country Coordinator, explains. “Namely, the regulatory agencies, banking and financial Institutions, and financial capability focused NGOs and educational institutions.” Financial inclusion is starting to become recognized as a challenge that needs to be addressed at a greater level and is increasingly high on the national agenda (Nepal Rastra Bank 2022).
Additional pressures on women as men are forced to look for work abroad
There are a number of gendered obstacles that continue to make building sustainable pathways out of poverty difficult in these communities.The precarious economic situation means that male community members must pursue work opportunities abroad as migrant workers. Nepali Overseas Migrant Workers are estimated to contribute over a quarter of Nepal’s GDP through remittance payments back to Nepali households (Nepali 2021 Census). When a large proportion of male community members leave for economic opportunity it impacts on the women. Women are left to manage the household, children, day-to-day finances and small businesses. However, these women are not adequately equipped with appropriate resources and tools to do so – with estimates putting the male literacy rate at 73.4% and at 55.7% for women in the wider district (UNESCO 2013). In this context, a contradictory situation can also occur. On one hand, many women are left to run the daily finances and household. On the other hand, historical and gendered norms persist, meaning that major financial decisions remain unilaterally dominated by male community members or elders.
Beyond the household, low levels of literacy and numeracy present further barriers for women entrepreneurs wanting to expand and grow beyond subsistence operations. Good Return’s for on the barriers facing women entrepreneurs in Nepal revealed that gendered social norms in Nepal restrict women’s mobility and their opportunities to network or to join business associations. Ultimately, this can put these women at a disadvantage both when navigating financial and legal bureaucracy, and understanding and negotiating loans and financial agreements.
Lack of access to capital
There are also obstacles to accessing capital in this region. Accessing capital is crucial for weathering economic hard times, starting or managing a business, or building sustainable livelihoods outside of the unreliable tourism industry. Microfinance has been a popular development program in Nepal for decades. However, because of the high visibility of the region’s tourism industry, an assumption that the district does not need as much Government or donor assistance persists. In practice, this means microfinance and adult education are better funded and managed in urban areas. In rural areas such as Solukhumbu very few major development banks operate. Small cooperatives continue to be the main financial service providers because they are more accessible geographically and are community led. Moreover, whilst there are numerous small savings and credit groups, a needs assessment field visit conducted by World Education Nepal revealed that many of these groups were inactive or operating poorly. Without strong account keeping and regular meetings, members lose confidence, fail to take advantage of the opportunities group membership should provide and risk paying extortionate loan interest rates.
How can these challenges be addressed?
A diverse group of financial capability and education focused organizations strive to support local communities to overcome these challenges. For example, Good Return and World Education Nepal are working with a range of international partners including Femi Foundations and local partners such as Sapana Village Lodge Social Impact (in Chitwan), Hill Development and Conservation Group and Solukhumbu Development Society (in Solu) and Women Awareness Centre Nepal (in Kavre) to deliver Good Return’s financial literacy program, Consumer Awareness and Financial Empowerment, or, CAFE. With a curriculum adapted to suit the needs of the local context, the financial capability program strives to empower low-income women to make informed financial decisions, plan their family and business budgets and understand their legal rights, in order to build long-lasting and safer livelihoods for themselves and communities. The urgent need for these programs became clear during the pandemic as pottering families in the Sotang, and Manakulung rural municipalities of Solukhumbu District had to adapt to changing livelihoods (read World Education’s Helen Sherpa and Mimu Raghubanshi’s experience here). This urgent need for training and resources will only continue over this winter season.
Financial capability programs must always strive to be timely, contextual and innovative. That’s why Good Return and local partners are looking to complement existing programs through:
- Implementing the CAFE Small Business Support Program
The CAFE Small Enterprise and Business Development program is a second round of training for participants and women in this area who have already undertaken the first round of CAFE training. The project values local leadership and will support Dalit women trainers (from the first round of training) to facilitate training with small groups of women in their community. The program also focuses on providing in-kind support to promote their entrepreneurship journey after the training.
- Strengthening saving and credit groups
This project aims to strengthen existing saving and credit groups in the region. Partner NGO staff will attend regular meetings of savings and credit groups to provide support, technical coaching, and feedback on how the group is functioning. The project will also provide ledgers and passbooks to the groups, as many need more basic materials to support smooth group functioning. Crucially, these women-led savings groups already exist and are central community hubs. This means that Good Return and partners’ role aims at bolstering the existing capacity of these groups and equipping these entrepreneurial women with the skills they want, led by their own community leaders.
- CAFE Digital
The CAFE Digital project will take the curriculum online with the increase in smartphone usage and internet accessibility in Nepali communities. Digitizing existing content and developing purpose-built interactions, the move seeks to increase the number of people who have access to this knowledge by thousands to maximize impact and accessibility.
Given adequate resources, appropriate information and training, there is no stopping what these women can do.
Good Return’s CAFE Initiative is delivered in partnership with the Australian Government through the Australian NGO Cooperation Program (ANCP) and with support from the Accenture Australia Foundation #ANCP.