UPSC Prelims 2021 Q14: Indian Economy – Digital Payments & Financial Inclusion
- (a) 1 and 2 only
- (b) 2 and 3 only
- (c) 1 and 3 only
- (d) 1,2 and3
Answer: (c) 1 and 3 only
Explanation
WaterCredit: Concept and Origin
| Statement | Claim | Verdict | Detail |
|---|---|---|---|
| 1 | Puts microfinance tools to work in water and sanitation | TRUE | WaterCredit is a microfinance-linked initiative that provides small loans to poor households for building water connections, toilets and sanitation facilities. |
| 2 | Launched under WHO and World Bank | FALSE | WaterCredit was pioneered by Water.org, an NGO founded by Gary White and Matt Damon in 2009 (through the merger of WaterPartners and H2O Africa). It is NOT a WHO or World Bank initiative. |
| 3 | Aims to help the poor meet water needs without depending on subsidies | TRUE | WaterCredit's core philosophy is market-based solutions - it moves poor households from waiting for subsidies to accessing affordable microfinance for water/sanitation. |
Statements 1 and 3 are correct.
Answer: (c) 1 and 3 only.
Why each option is right or wrong
- (a) Incorrect. WHO/World Bank did not launch WaterCredit - Water.org (Matt Damon's NGO) did.
- (b) Incorrect. Statement 2 is wrong - Water.org is the founder, not WHO/World Bank.
- (c) CORRECT. Statements 1 (microfinance for water/sanitation) and 3 (market-based, no dependence on subsidies) are true. Statement 2 wrongly attributes WaterCredit to WHO/World Bank.
- (d) Incorrect. Statement 2 is factually wrong.
Key point
WaterCredit = microfinance loans for water/sanitation. Pioneered by Water.org (Matt Damon and Gary White, 2009), NOT WHO/World Bank. Philosophy: market-based, subsidy-independent. Empowers the poor to buy their own water/toilet access.
Remember
WaterCredit puts microfinance tools to work in the water and sanitation sector (statement 1 correct) and aims to help the poor meet water needs without depending on subsidies (statement 3 correct). It was launched by Water.org (NGO founded by Matt Damon and Gary White), NOT by WHO or World Bank (statement 2 wrong). Answer: 1 and 3 only.
Common mistakes
- Assuming any global initiative must be UN/WB. Many innovative water/sanitation programmes are led by NGOs like Water.org, WaterAid and BRAC.
- Not knowing microfinance can fund WATER access, not just consumption or micro-enterprise. Water/sanitation loans have <5% default rates globally.
- Confusing WaterCredit with government subsidy schemes like Swachh Bharat Mission or Jal Jeevan Mission.
Exam tip
When a UPSC statement attributes a private initiative to WHO/World Bank/UN, be suspicious. Many programmes look like they must be UN-led but are actually NGO or private-sector initiatives. Water.org, Gavi Alliance, and Global Fund are examples of hybrid initiatives.
Sources
- Water.org - WaterCredit Program Documentation
- Ministry of Jal Shakti - Financing Water and Sanitation