With earthworms and an oven, she built a better life for her family

Ms Lilis Suhartini, 36, pulls a tray from the large oven in her kitchen, carefully inspecting the batch of brown particles.

These are not ingredients for pastries; they’re finely ground powder made from dried earthworms which she supplies to a local pharmaceutical company. The powder is commonly used as a traditional remedy for treating typhoid fever in Indonesia.

In the rural village of Pengalengan in West Java, Ms Lilis runs a business producing earthworm powder.

She employs four workers in her home-based operation – a traditional village house spanning 75 sq m, about the size of a three-room Housing Board flat, with a kampung-thatched roof.

Each month, Ms Lilis produces over 100kg of earthworm powder, which is sold for about 100 million rupiah (S$8,190). 

This was made possible with an investment she made in 2022: The large 150cm by 70cm oven that sits in her kitchen.

Ms Lilis bought it after taking out a microloan of 4 million rupiah from Amartha, an Indonesia-based fintech firm.

Amartha was founded in 2010 as a microfinance institution. It provides small loans to micro, small and medium-sized enterprises in rural Indonesia, particularly those run by women.

In her rural village, making earthworm powder is a trade largely dominated by men, Ms Lilis explains. Many women in the community shy away from the work, put off by the wriggling worms and having to toil under filthy conditions.

But Ms Lilis never flinched.

A decade ago, she was a housewife. Her husband worked as a silkworm farmer, earning just $200 a month. They worried about not having enough money for the education of their two sons, now 16 and 10.

In the rural areas, she shares, cattle farms generated organic waste, attracting earthworms. And in her village, these earthworms were prized for their medicinal properties. 

Seeing the potential, Ms Lilis decided to make a business out of supplying earthworm powder. She taught herself every aspect of production – from harvesting and washing the worms to carefully drying them in the oven. 

Her husband left his job to build the business with her.

Initially, Ms Lilis produced small batches of earthworm powder, selling it to a local traditional herbal drink shop. She earned about 5 million rupiah a month back then.

Small loans, big steps

Women micro-entrepreneurs in rural areas of Indonesia face challenges like financial literacy and lack of access to funding, says Mr Andi Taufan, founder and chief executive of Amartha. 

Amartha provides them with microloans, which range from $400 to $1,330, as working capital to start and scale their businesses.

Ninety-nine per cent of Amartha’s borrowers are women in rural villages who run small stores selling items like cassava chips, steamed cakes and Siamese fighting fish. 

To meet growing borrower demand, says Mr Taufan, Amartha became a fintech firm after attaining a peer-to-peer lending licence from the Indonesia Financial Services Authority (OJK) in 2016. 

The company now connects borrowers from rural villages with institutional and individual lenders in urban areas. 

In 2019, UOB Venture Management provided Amartha with capital to scale rapidly. Within six years, what started as support for 343,000 women-led micro-enterprises in 5,200 villages grew to over 2.6 million across 50,000 villages in Indonesia (see box below).

Safer, more accessible

Why the focus on women? “Many of them are unbanked, lacking the formal credentials (or) know-how to access funding from formal sources such as banks,” says Mr Taufan, 38. “Others are ineligible because of a lack of formal credit history.” 

As a result, some of them turn to informal lenders like loansharks – often at a steep cost.  

These loans are an easy but risky option, and often come with extremely high interest rates at about 140 per cent per annum, explains Mr Taufan. When borrowers struggle to pay, the loansharks would intimidate and seize belongings.

With transparent interest rates that are in accordance with or below Indonesia’s regulatory ceiling, Amartha aims to provide a better – and safer – alternative for female business owners in rural areas. 

In 2023, Indonesia’s OJK instructed peer-to-peer lenders to

set their daily interest rates at a maximum of 0.3 per cent

Mr Taufan explains that Amartha developed a unique credit scoring system that leverages artificial intelligence to assess borrowers using alternative data points. 

For example, the type of tiles used in a borrower’s home can serve as a “valuable proxy for formal credit scoring indicators”, he says. 

Such information is gathered by Amartha’s army of over 9,000 field agents who are on the ground, assessing the borrowers and their assets.

“(These) indicators differ from one area to another. You (need) first-hand knowledge and experience when it comes to the grassroots, especially in Indonesia with its enormous cultural and geographic diversity,” Mr Taufan adds.

When women business owners borrow from Amartha, they repay the loans via a joint responsibility model.

Under this system, the borrowers are grouped into joint liability groups of 15 to 20 members from the same village. 

Every week, they gather to make loan repayments. An Amartha field agent is at each meeting to provide financial literacy training. 

If one member struggles to make a payment, the rest of the group steps in to cover the amount. This helps to reduce the risk of defaults, Mr Taufan says.

Beyond dollars

For Ms Lilis, the small initial loan of 4 million rupiah (S$327) from Amartha was the spark that changed everything. 

With that first step, she managed to grow her business – and build a better future for her family.

The increase in income from selling earthworm powder allowed Ms Lilis to pay for her sons’ education. 

She subsequently took on two more loans – 5 million rupiah in 2023 and 7 million rupiah in 2024. These enabled her family to upgrade to the current larger house that comes with a spacious backyard, which she used to expand her business further.

Ms Lilis is currently servicing her 2024 loan, which has a repayment period of 50 weeks. During the weekly repayment sessions, Amartha’s field agent taught Ms Lilis basic bookkeeping skills so she could track her cash flow. 

This has enabled her to manage her business more efficiently, she shares in Bahasa Indonesia. “I’m the financial manager who keeps the cash flowing, (while) my husband is the operational manager, making sure production runs smoothly.” 

In the past, loan repayment was time-consuming for Ms Lilis. The weekly gatherings for loan repayment can take up to two hours. 

After the AmarthaFin digital app was introduced in 2024, she could make payments digitally with just a few taps on her smartphone – saving her time to focus on her production. 

What’s next? Ms Lilis has bold ambitions. 

She plans to buy more ovens, expand her operations, and tap into e-commerce to reach a wider market.

Ms Lilis also hopes to inspire other women in her village to join the earthworm powder business. 

“Earthworm powder has helped many people recover from illness – (it is) a good and profitable business,” she says.

This is the fourth of a six-part series titled “Right by you”, in partnership with