Financial inclusion

Improving financial literacy and inclusion for informal workers and micro-entrepreneurs
Improving financial literacy and inclusion for informal workers and micro-entrepreneurs

Financial inclusion

Improving financial literacy and inclusion for informal workers and micro-entrepreneurs
Improving financial literacy and inclusion for informal workers and micro-entrepreneurs

Need for financial inclusion in India

Why Financial Inclusion Matters

Empowering Entrepreneurs

Access to financial services through returnable grants and access to credit enables aspiring entrepreneurs to start and grow their businesses, driving economic growth and job creation.

Enhancing Livelihoods

Financial inclusion allows individuals to save, invest and access credit through financial and digital literacy, leading to improved income generation and overall livelihoods.

Resilience and Security

A strong financial foundation provides a safety net during times of crisis through affordable and timely credit, insurance and social security to help individuals plan for the future.

Barriers to Financial Inclusion

  • Privacy concerns and data security issue
  • Technology limitations in rural areas
  • Low financial literacy and awareness
  • Insufficient infrastructure in rural areas
  • Lack of proper authentication mechanism
  • Poor last mile connectivity in rural areas

Barriers to Financial Inclusion

  • Privacy concerns and data security issue
  • Technology limitations in rural areas
  • Low financial literacy and awareness
  • Insufficient infrastructure in rural areas
  • Lack of proper authentication mechanism
  • Poor last mile connectivity in rural areas

Samhita-CGF’s Theory of Change

Samhita-CGF’s Financial Literacy Process

Financial Literacy

    The Samhita-CGF Advantage

    Catalytic impact
    Funders

    Our blended finance instruments have been developed to be sustainable in terms of both leverage and in naturally facilitating the graduation of participants towards formal credit

    Market making
    NBFCs

    Our facility is the first of its kind that focuses on supporting NTC and NTI segments, who otherwise remain unbanked, and aim to facilitate their graduation by supporting our RG participants who demonstrate good repayment behaviour.

    Sourcing participants
    NBFCs

    We will support NBFCs in sourcing participants through our strong network on NGOs, implementation, and training partners with pan-India reach. We are working with government organisations like SIDBI who will also support the sourcing of participants.

    Technology enablement and robust MEL tracking
    all

    We are working with Societal Thinking to develop our technology platform for scale where we will onboard and monitor REVIVE participants, not only through the course of the program but after completion as well.

    We are creating indices to gauge the effectiveness of our interventions, including the Income Index, Resiliency Index, and the Women’s Empowerment Index.

    Supporting long term, holistic impact
    Participants

    Our participants often face a knowledge and/or skills gap which access to finance alone cannot bridge.

    We therefore support participants by providing additional intervention support (digital / financial literacy, skilling, enterprise development, etc.) to build their capabilities and bridge this gap.

    Participants receiving holistic support will be more capable to repay loans

    Our blended finance instruments have been developed to be sustainable in terms of both leverage and in naturally facilitating the graduation of participants towards formal credit

    Our facility is the first of its kind that focuses on supporting NTC and NTI segments, who otherwise remain unbanked, and aim to facilitate their graduation by supporting our RG participants who demonstrate good repayment behaviour.

    • We will support NBFCs in sourcing participants through our strong network on NGOs, implementation, and training partners with pan-India reach.
    • We will support NBFCs in sourcing participants through our strong network on NGOs, implementation, and training partners with pan-India reach.
    • Our participants often face a knowledge and/or skills gap which access to finance alone cannot bridge.
    • We therefore support participants by providing additional intervention support (digital / financial literacy, skilling, enterprise development, etc.) to build their capabilities and bridge this gap.
    • Participants receiving holistic support will be more capable to repay loans
    • We are working with Societal Thinking to develop our technology platform for scale where we will onboard and monitor REVIVE participants, not only through the course of the program but after completion as well.
    • We are creating indices to gauge the effectiveness of our interventions, including the Income Index, Resiliency Index, and the Women’s Empowerment Index.

    Challenges to generating livelihoods

    There is a massive credit gap of $530 billion in the MSME sector in India. Out of more than 64 million MSMEs, only 14% have access to credit. 

    47% of the debt demand is unaddressable as it comes from "enterprises which are not financially viable or prefer financing from informal sources.”

    Only 6% of all MSMEs actively sell on e-commerce platforms. Owing to the informal nature of businesses, entering and navigating the market can be a daunting task. Limited market knowledge and resources exacerbate the challenges. 

    • The Indian government spends over 7% of its GDP on welfare services. But there’s still a huge gap in the demand and supply, resulting in unspent funds

    India’s FLFPR is abysmally low at 23%, as compared to other emerging economies like Vietnam (~70%). while more women have a bank a/c now, with no gender gap, the number of women aged 15-49 who have money that they can decide how to use has grown very tepidly, from 44.6% to 51.2% between NFHS-3 IN 2005-06 and NFHS-5 IN 2019-21.

    Latest News