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As a Dalit, one of India's “Untouchables,” Pentamma was relegated to life of poverty and squalor until she discovered microfinance. In this excerpt from Transforming Lives $40 at a Time by Dana Whitaker, Pentamma begins her journey to a new future thanks to Grameen Foundation partner SKS, 2005 winner of our Excellence in Microfinance Award.

The branch manager wends his way through Village Singeetam, drawing an ever-swelling crowd of curious onlookers. Finally he arrives at the far edge of the village where Dalits ("Untouchables") have been relegated to live. Pentamma is waiting. Though she has never been visited by so many people, she greets the crowd with a calm nod of resolve.

With clipboard in hand, the manager begins the first phase of his assessment to see if Pentamma qualifies to become an SKS borrower. Using SKS's Housing Index, he scores the quality of her home’s roof and walls, and whether there is running water and electricity. Only if Pentamma’s house scores below a ten, thus ranking her among the poorest of the poor, will she be eligible to proceed with the qualifying process. Her husband earns just Rs30 ($.68) a day, while she earns Rs20 ($.45) for the same job as a day laborer when there is work. With the gaping straw roof covering her miniscule two rooms for four people, lacking both running water and electricity, Pentamma's house scores a six, well within range of eligibility.

Pentamma and four other Dalit women proceed to a neighbor's dirt courtyard where they must now pass the Group Recognition Test. Pentamma clutches a large white piece of paper as she sits cross-legged on a straw mat with her group, their SKS trainer and the branch manager. The crowd presses in from all sides to witness the challenges ahead.

For the past five days, the trainer has been teaching these women about SKS microloan policies and procedures: the 50-week loan cycle, 15 percent interest and $.10 weekly savings requirements. They have also learned about SKS’s democratic system of borrower groups, a concept totally foreign to women wh o -- according to Hindu culture -- have no value. They sit in a circle, have elected a group leader, and take turns speaking.

The branch manager signals the test to begin. In unison, the women successfully recite the SKS pledge. Then, placing a pile of smooth green-gray stones in the middle of the circle, the manager asks each woman to configure a symbolic borrower group. Since this group will join six other groups to create a center, he watches as they arrange a circle of 30 stones representing an SKS center.

Satisfied with that portion of the test, the manager next assesses the group’s ability both to count out loan amounts that a borrower may receive (between Rs1,000 and 10,000, or $23-$230), and to calculate weekly loan repayments, interest and savings. They answer each of his questions, and he puts the money away. Now is the time for the ultimate test.

Pentamma unfolds her piece of paper and flattens it out beside her. Finally, it is her turn. She is handed the notebook and pen. Taking a deep breath, she awkwardly weaves the unfamiliar implement between her fingers. Placing the point onto the page in front of her, she very slowly begins to write. She stops, checks her work against what is written her own paper, and readjusts the pen. Pentamma’s marks get larger and start to drift downward, but she continues across the page until the last oversized curve has been made. Pentamma has just accomplished, at age 25, what others more fortunate than her accomplish by age four or five. This illiterate Dalit has just written her own name. It is the only word she can write, but it is enough.

The branch manager nods and everyone, including the onlookers, erupts with applause. A new SKS borrower group has just been born.

Since this story was written, Pentamma has purchased a water buffalo that yields six liters of milk per day. She sells five and keeps one to feed her children. With her profits, she is buying more nutritious food for her family.

Edited excerpts from Dana Whitaker's Transforming Lives $40 at a Time. Reprinted with permission.

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