Nyotra – A Tradition of Community Lending

Policy Research and Consulting

Nyotra – A Tradition of Community Lending

August 6, 2018 Uncategorized 0

Tribal farmers in Southern Rajasthan, in districts of Banswara and Dungarpur have a traditional practice of collecting money from the community for a number of occasions. It could be for social occasions like celebrating marriages or childbirth, for meeting financial requirements in case of a death in the family or for meeting sudden medical emergencies. This practice is called a Nyotra. One must not confuse this with nyota, a commonly used word in Hindi for ‘an invitation’. When a farmer (or any person in the village or community) calls for or announces a Nyotra, it means that she is asking upon her social circle in the community for immediate monetary assistance.

On hearing about the Nyotra, people in the community visit that household and pool in money by making their own individual contributions. The receiving household becomes indebted to each of these individuals who contributed money. This also means that anytime in the future now if any of these contributing individuals calls a Nyotra, then the people who have borrowed from her must also contribute their share, usually the same amount that they had borrowed from that individual.


A Nyotra therefore is a way of borrowing and repaying within the community, usually in the form of cash. Repayments are neither guided by timelines nor are subject to interest payments. A moral code of sorts in the underlying mutual understanding within the community ensures that this structure of borrowing money does not fall apart. Individual keeps their personal records, though informally and adjust it each they participate in or call for a Nyotra. The practice has been going on for generations and has created a unique network of credit within the tribal communities.

However, this traditional practice of borrowing is not all roses and has created a number of challenges for the community. Though the practice still continues, it often becomes a burden for the participating individuals. Of late, a number of farmers reported a sharp rise in the Nyotras being called. If person A calls a Nyotra and had earlier contributed in Nyotras of B, C and D then following customs, B, C and D must contribute to A without delay. B is therefore under social obligation to pay to A in such a situation and likewise would be under obligation to pay say X, Y and Z too at any time they call for a Nyotra. This puts additional burden, both financially and in terms of the expectations that the individual must meet being part of the community.

Nyotras in this manner are resulting in farmer distress as the farmers at all times do not have cash savings to contribute. The tribal communities in this region are largely dependent on agriculture and livestock and do not hold much cash at all times of the year. A number of transactions can take place through barter. When financial requirements are relatively high, say for buying agricultural inputs, paying for tuition of children or medical requirements, farmers choose to sell their goats.

Farmers choose to sell goats for cash when they have urgent payments to make and in that way the goat serves as a valuable asset for the household. Almost every household rears goats which is a part of their daily living. They own other livestock like cattle but goats are like a moving ATM for the famer owing to its high liquidity. There is a large network of buyers and local markets for goats which ensures that farmers are able to sell their goats in very little time from when they decide to sell the goat. However, owing to the growing liability of farmers in the form of the Nyotra, many are forced to sell their goats to make contributions as selling a goat is the quickest and least risky way of arranging cash for the farmer. This in turn affects their ability to meet other financial requirements which they would have met through selling their goat.

Community lending is an important component of the social fabric which exists for generations within the tribal community in Southern Rajasthan. It supports the households in overcoming immediate financial requirements without having to look outside the community. However, it has also become a tool for many to call upon the society in a more insensitive manner to borrow money which is growing to become a financial burden for the community. It continues to be a practice of immense importance but not without its caveats and distress inducing outcomes.

Our team from Creative Agri Solutions was studying the goat value chain in Banswara and Dungarpur, Rajasthan. The project involved studying the production and marketing aspects of goat rearing, the stakeholders involved and the potential of supporting livelihoods through developing the goat sector. We had come across the practice of Nyotra during the Focus Group Discussions with women farmer groups in the region and explored how it had an impact on their decision to sell goats and overall household income.


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