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Author: Samhita - CGF

Strengthening Communities: Introducing the Four Vital Indices by Samhita-CGF

In the pursuit of comprehensive financial inclusion innovations, Samhita-CGF’s pioneering network alliance is steadfastly working towards addressing the credit gap experienced by underbanked communities and micro-entrepreneurs. To assess our progress in this initiative, we are excited to introduce a revolutionary method for measuring and improving credit impact outcomes for informal sector enterprises by introducing four key indices – the Income Index, Economic Empowerment Index, Women Economic Empowerment Index, and Resilience Index. These indices are intricately crafted to offer in-depth insights into the economic well-being and resilience of communities. Let’s explore the significance of these indices and understand their vital role in evaluating the impact of informal sector enterprises and the households they support.

The significance of indices

Indices are vital tools for tracking progress and measuring the change in various aspects of communities. For instance, the Reserve Bank of India’s Consumer Confidence Index reveals that consumer sentiment rebounded significantly in the last quarter, reaching an index value of 118.8, indicating a growing confidence in the economy. This data points to the importance of understanding the sentiments and perspectives of consumers for effective economic policies. An index is thus “a single, unique numerical value tracked over a given period as a time-series”. Some of the other common indices measured in India are MoSPI’s consumer price index (CPI), BSE Sensex, air quality index (AQI), RBI’s financial inclusion index, etc.

In 1990, the United Nations Development Program (UNDP) transformed the landscape of development theory, measurement, and policy with the publication of its first annual Human Development Report (HDR) and the introduction of the Human Development Index (HDI). The HDI, born from Amartya Sen’s revolutionary “capabilities approach,” emphasized the importance of human well-being beyond income. This pioneering index inspired the creation of other impactful measures, with the latest HDR published in 2022.

More recently in July 2023, NITI Aayog came out with the progress report on multidimensional poverty index, which derives its methodology from the Global Multidimensional Poverty Index (MPI) published by Oxford Poverty and Human Development Initiative (OPHI) and the United Nations Development Programme (UNDP). 

The choice of the indices by Samhita-CGF

In an increasingly interconnected world, the need for robust indices cannot be overstated. Traditional economic indicators often fall short in capturing the nuanced challenges faced by different segments of the population. The Income Index, Economic Empowerment Index, Women Economic Empowerment Index, and Resilience Index are tailored to bridge this gap. Below is a snapshot of the same.

According to a recent UNDP report, the global Gender Development Index (GDI) shows progress, but it also highlights the persistent gender disparities in education and income in various regions. This underscores the importance of specialized indices like the Women Economic Empowerment Index to address these specific challenges. Similarly, the Resilience Index aims to measure the ability of the proprietor’s household to withstand any exogenous or endogenous shock, given the sustainability offered by the growth of the enterprises through capital and other intervention support provided by Samhita-CGF.

Indices as a means to track our commitment to the vision for supporting the informal sector

Through the REVIVE Alliance, Samhita- CGF envisions to empower communities through data-driven insights and targeted interventions. Our recent impact assessment shows that through this alliance, we have catalysed the advancement of livelihoods for over 5,50,000 informal workers and entrepreneurs in just three years. This includes more than 4,40,000 women who have benefited from multiple interventions under the alliance, showcasing the potential for transformative change. We believe that by accurately measuring and understanding economic empowerment and resilience, we can implement interventions that have a lasting impact on the lives of individuals and families.

The resounding success of REVIVE looks at the next phase where we aim to irreversibly increase incomes and improve the livelihoods of 2 million participants over the next 3 years, and 10 million workers and MSMEs in 5 years (with at least 50% being women) through multi-year, multi-intervention support of participants. We aim to not only facilitate the graduation of small businesses into the formal economy, but also provide evidence to demonstrate the creditworthiness of these segments as a whole and create a new market for formal lending for banks, NBFCs, and other FIs. Our co-created pre credit score (PCS) will be used as a proxy for a formal credit rating and be required as a scheme prerequisite. (We elaborated more on PCS here.)

In a world where change is the only constant, it is imperative that we have the tools to adapt and grow. The Income Index, Economic Empowerment Index, Women Economic Empowerment Index, and Resilience Index are the embodiment of our commitment to creating a brighter, more prosperous future for all. (We deep dive into one of the indices, Women Economic Empowerment Index, here.) With these indices as the basis of measurement of impact on each beneficiary’s life, we can assess not only the number of beneficiaries but the degree to which the impact was created in the life of each individual. These indices would give a deeper insight into the impact REVIVE is creating and will aid the alliance to dive deeper into the challenges and opportunities to support and impact many more lives. 

 

This article was authored by Abhishek Gupta, Ipsita Gupta, and Varnika Jain

Chetna Gala Sinha

Samhita-CGF’s expertise in supporting women entrepreneurs perfectly complemented Mann Deshi’s mission of empowering rural women with the tools and knowledge they need to break free from poverty’s grip.Supporting Mann Deshi through REVIVE, we supported more than 5,300 vulnerable women across Maharashtra with Returnable Grants and consistently saw close to 100% repayment rates in spite of the pandemic and multiple economic crises that the women had weathered. 

 Chetna Gala Sinha, Founder – Mann Deshi Foundation, talks about how this partnership provided holistic access to credit and livelihood support to women entrepreneurs at a time when they needed it the most.

Sapna Prabhakaran

Samhita-CGF, through REVIVE, and its approach to livelihood recovery was closely aligned with Avendus’ program on promoting entrepreneurship among rural women communities. Together, we addressed critical issues faced by women entrepreneurs: viz. access to finance, market linkages, and income diversification. We are on our way to impacting 800 women through Returnable Grants, with an astounding 97% repayment rate.

 Sapna Prabhakaran, Executive Director and Head – Marketing & Corporate Communications, Avendus talks about this amazing initiative.

Dr. Megha Phansalkar

Samhita-CGF’s collaboration with Tisser brought together multiple partners and funders committed toward the holistic growth of vulnerable women artisans by layering on complementary interventions. Google, MSDFF, Vinati Organics supported access to credit for the artisans, with an RG repayment rate of over 97%. The participants also received digital and financial literacy/prudence training through Linkedin as well as access to at least 2 social security schemes/entitlements through Samhita-CGF supported by CMS Swasti.

Dr. Megha Phansalkar, Founder – Tisser Artisans Trust, talks about how the partnership with Samhita-CGF through REVIVE ignited their entrepreneurial spirit in these women artisans, and paved the way for a brighter, more inclusive future.

Creating the Hygiene Culture: Impact of Dettol School Hygiene Program

COVID-19, the most severe public health crisis of our times, amplified our need for hygiene & sanitation. Governments, policy makers, health workers and civil society swiftly ramped up hygiene infrastructure and education in their drive for a disease-free world.

Following this trend Samhita & Collective Good Foundation partnered with Reckitt Benckiser to launched the Dettol School Hygiene Education Programme in the State of Andhra Pradesh in 2015 and extended the programme to Telangana by 2016 and to Tamil Nadu by 2018.

The programme builds knowledge, attitudes, practice and behaviour around hygiene in children by engaging children as collaborators, letting them drive the change. It builds their leadership and critical-thinking skills and enables them to solve hygiene problems in creative, sustainable ways, like solving the problem of access by setting up soap banks, ensuring hygiene through Child Parliaments and more.

In a boost to the programme, the curriculum was translated into several local languages, easing the path to adoption and engagement across South India. In another first, Collective Good Foundation introduced digital learning through government education portals. Andhra Pradesh was the first state to upload digital video episodes on their DISHA portals. These videos are accessible to all schools and teachers at the touch of a button and now reach 2.5 million students across 42,000 schools.

Click below to read the full report on how the Dettol School Hygiene Education Programme is developing a culture of hygiene in India’s children.

Empowering Women Entrepreneurs: Unveiling the Women Economic Empowerment Index

To push towards sustainable development goals, the voice and agency of women are catalysts for change and progress. Recognizing this, Samhita-CGF has taken a bold step towards quantifying and fostering women’s economic empowerment through an initiative: the Women Economic Empowerment (WEE) Index. This comprehensive tool is designed to measure and monitor the progress of women entrepreneurs in India’s dynamic semi-formal and informal sectors, recognizing their pivotal role in driving economic growth and societal transformation. 

 

Measuring Progress: From UN’s GEM to WEE Index

In 1995, the United Nations introduced the Gender Empowerment Measure, a landmark effort to measure the advancements made by women globally. This was followed by two critical indices—the Gender Development Index and the World Bank’s Women, Business and the Law Index – evaluating gender inequalities across health, education, income, and specific economic empowerment indicators. While these global indices provide valuable insights, they often overlook a significant population: women operating in India’s informal sector. It became imperative henceforth, to recognize this gap and develop an index tailored exclusively for women-run microenterprises in India’s semi-formal and informal sector.

 

Unpacking Empowerment: The Six Dimensions of WEE Index

The WEE Index delves into six key dimensions that shape economic empowerment. These dimensions are carefully crafted to provide a comprehensive view of the multifaceted journey towards empowerment. They reflect not only economic progress but also the social and personal factors that influence a woman’s ability to thrive in her entrepreneurial endeavours. By addressing each dimension, the index helps to create a holistic framework that uplifts women not only as economic contributors but as leaders and change-makers within their communities. 

The selection of these six dimensions for the Women Economic Empowerment (WEE) Index is rooted in the need for a nuanced and comprehensive evaluation of women’s economic progress. Each of these dimensions serves as a broad category, further broken down into specific sub-dimensions and tangible indicators. For instance, within “Enterprise Performance,” aspects such as formalization, including registration under Udyam and GST, as well as the adoption of digital technologies for business growth is scrutinized. Similarly, “Intra-household Decision-Making” recognizes that empowerment extends to a woman’s ability to influence decisions within her household and community. This is evaluated through indicators like her confidence in handling banking transactions independently and active participation in women’s groups for networking and advice. 

 

Thus, these six dimensions, along with their respective sub-dimensions, form the building blocks of the WEE Index, ensuring a robust and inclusive assessment of women’s economic progress. The weightages are also assigned to the dimensions according to the influence they wield on overall women economic empowerment. 

 

Integrating the Women Economic Empowerment Index

The integration of the WEE Index into REVIVE Alliance is a monumental stride towards advancing livelihoods. Over the past three years, REVIVE has empowered over 5,50,000 informal workers and entrepreneurs, of which more than 4,40,000 are women, benefitting 1,76,573 MSMEs. The aim is to reach an ambitious target of impacting and empowering 5 million women beneficiaries in the next 5 years through multiple interventions. Integrating the Women Economic Empowerment (WEE) Index into REVIVE, is a significant step towards advancing economic empowerment for women. This strategic move allows to continuously assess and track the progress of women entrepreneurs within the chosen cohort. Through a structured panel design survey, one can gain invaluable insights into the economic empowerment journey of these entrepreneurs. This data-driven approach not only refines the multiple interventions under REVIVE Alliance, but also enables targeting resources effectively, ensuring that women receive the support they need to thrive.

 

From Index to Impact: How the WEE Index Drives Change

The true power of the WEE Index lies in its ability to catalyze change on the ground. As an actionable tool, it empowers organizations, policymakers, and stakeholders to make informed decisions and craft targeted interventions. By understanding the nuances of women’s economic empowerment, we can design programs that address specific challenges, provide tailored support, and amplify impact. The WEE Index isn’t just a measurement; it’s a catalyst for meaningful, sustainable change!

 

Through initiatives like the WEE Index and strategic collaborations, we are steadfastly building a future where women entrepreneurs are not just participants but leaders, not just beneficiaries but catalysts of change.

 

This article was authored by Ipsita and Abhishek Gupta

India Inc buckles up to mitigate the impact of the COVID-19 pandemic

“Whether to safeguard their workers or help strengthen the country’s COVID-19 response, companies across India are stepping up to strategically utilize their resources to address the here-and-now but also shoring up for the future in ways that are beneficial to both business and society.”

Samhita’s CEO & Founder, Priya Naik and Visiting Scientist at The Banyan Academy of Leadership in Mental Health, Dr. Nachiket Mor, illustrate the virtuous cycle of mutual benefit that can be created between business and society, especially in times of such crisis when the chasms between the haves and have-nots are wide.

click here to read the article

Why the health of sanitation workers needs to be our society’s concern?

“In a world without sanitation workers, business and daily life would come to a halt”.

It may seem too extreme to state but is nevertheless true. Without sanitation workers, the functioning of our ecosystem will halt as supply chains of products and services are adversely affected.

Samhita believes that it is essential to ensure preventive health care for our sanitation workers to not only ensure the smooth functioning of our society but also enable them to live a life of dignity. Our WASH platform and, more recently, our IPA platform aims to put money where our mouth is.

To know more about our approach, read this article written by Priya Naik, Ragini Menon and Tushar Carhavlo for CNBC-TV18.

Click here to read the article

Frequently Asked Questions: Compliance & The Returnable Grant

Returnable Grants (RGs) have emerged as a transformative financial instrument, driving economic empowerment and livelihood for vulnerable communities.

A Returnable Grant (RG) provides short-term, affordable, and flexible capital (zero interest and zero collateral) to individuals and entrepreneurs. The RG levies individuals with a moral (and not legal) obligation to repay.

Organisations such as Godrej, S&P Global, 360 One, Michael Susan, and Dell Foundation have embraced RGs as a central component of their projects aimed at supporting financial inclusion and livelihoods of informal workers, microentrepreneurs, farmers, artisans, and beauty entrepreneurs, and have seen its transformative impact through increased financial knowledge, increased incomes, and access to new skills and jobs.

This blog addresses frequently asked questions on compliance of Returnable Grants.

Here’s how it works

Donors who are interested in adopting Returnable Grants as a feature in their projects onboard a technical partner (Collective Good Foundation), who designs and structures the returnable grant, provides performance management support, and identifies the donor’s choice of recipients.

The criteria for selection are as follows:

  • First-time participants who are in need of capital, also known as ‘New to Credit’ or NTC, and can be introduced to the credit ecosystem through the returnable grants model
  • Potential ability of selected participants to repay as a cohort
  • Existing engagement or relationship with non-profit partners, to understand if the Returnable Grant can be a good layer on other interventions

Where does the Money Go?

Returnable Grants allow money to be directly credited into the  beneficiaryaccounts or given out as cash equivalents such as vouchers. This process is supported by non-profit organisations or non-banking financial company (NBFC) partners. Once a returnable grant is repaid, it is circulated back into the repayment ecosystem to support additional participants with similar needs.Returnable Grant Fund Flow

 

What are the FCRA/CSR norms, and how does it apply to organizations (donor and non-profits) using the RG model?

Compliance from an FCRA lens

What is the FCRA, and how does it apply to organizations using the RG model?

  • The FCRA is a regulatory framework that aims to regulate foreign contributions for economic and social programs.
  • This applies to foreign funds from foreign donors (foundations, bilateral agencies, multilateral agencies, HNIs, etc.)
  • RGs, designed within the FCRA guidelines, fall within the ambit of an economic and social program under Section 11(1) of the FCRA, 2010. This ensures the utilization of funds aligns with the intended purpose.

How does the RG model comply with FCRA regulations?

  • RGs are implemented through trusted partners, such as Non-Banking Financial Companies (NBFCs).
  • These partners distribute the funds to selected participants, who repay the partners instead of repatriating the money to the original funders.
  • This continuous circulation within the beneficiary ecosystem maximizes outreach and impact while complying with the FCRA guidelines.
  • Funds given by CGF (registered under FCRA) to the beneficiary Is not considered as sub-granting under FCRA as amended In September 2020.
  • Also, the NBFC Is simply the channel for transfer of FCRA funds to the beneficiaries Bank Account

Compliance from a CSR lens

CSR regulations apply to corporates registered under the Indian Companies Act.

How do RGs align with CSR regulations?

  • RGs can be categorized under Schedule VII of the Companies Act, 2013, which outlines eligible CSR activities.
  • By deploying RGs for approved initiatives, organizations fulfil their CSR expenditure obligations and contribute to social impact.

How is the utilization of RG funds tracked to ensure CSR compliance?

  • Once RG funds are received by the first set of beneficiaries, they are deemed to be utilized, satisfying the company’s CSR obligation.
  • As participants repay the funds, they are recirculated within the participant ecosystem and tracked to ensure compliance with CSR regulations. The recirculation within the beneficiary ecosystem Is purely a value added advantage of this model.

Common compliance:

  • Once the first round of RGs are disbursed, funds are recorded as utilised for the project – fulfilling FCRA and CSR regulations
  • Repaid funds are given to other deserving participants within the eco-system. Money is never returned to the donor and continues to rotate in the participant ecosystem until all funds are utilized.
  • Alternatively, at the end of a certain period, the donor can choose to spend the money as a grant for aligned activities, compliant with CSR and FCRA norms
  • Donors can choose to receive updates and impact reports until all funds are exhausted

 

What are some key considerations for non-profits using the RG model to ensure compliance with CSR regulations?

  • Adhering to FCRA guidelines when utilizing foreign funds for RGs.
  • Aligning RG activities with the approved categories in Schedule VII of the Companies Act, 2013.
  • Ensuring beneficiaries receive the funds in their designated bank accounts.
  • Verifying that the funds are used for specific business use cases and not for activities prohibited by law.

Are Indian not for profits typically tax exempt? Who are the secondary recipients who can recover and redeploy Returnable Grants

  • Yes, Indian non-profits are tax exempt.
  • Secondary recipients can only be not for profits, or designated intermediaries on behalf of the NGOs such as NBFCs (Non Banking Financial Corporations)

What are the factors affecting the returnability of a Returnable Grant?

  • The timeline of a Returnable Grant depends on nature and requirement of the cohort.
  • It may be returned during any time period – from a few months or within a few years – depending on the size of Returnable Grant, nature of cohorts and changed field conditions.

Are there any restrictions on the use of RG funds for CSR activities, and if so, what are they?

  • While there are no specific restrictions, organizations must ensure that the utilization of RG funds aligns with approved CSR activities as per Schedule VII of the Companies Act, 2013.

What reporting and monitoring requirements are associated with the use of RG funds for FCRA/CSR activities?

  • Organizations must maintain proper records of fund utilization, prepare periodic reports, and ensure transparency in reporting.

Returnable grants (RGs) provide a compliant and transformative approach for donors and non-governmental organizations (NGOs) to create sustainable impact in communities they service. By embracing RGs, donors can unlock greater financial resources to drive economic empowerment and improve livelihoods for vulnerable individuals and entrepreneurs. The unique design of RGs instils a sense of responsibility and empowerment among recipients, fostering a culture of self-sufficiency and long-term success.

Through the adoption of RGs, donors and NGOs have a powerful tool to effect long term positive change with vulnerable and at-risk communities.

Enabling Stakeholders to Take Purposeful Action for Large-Scale Social Impact

“Beyond CSR, we believe in companies integrating social responsibility into their business practices. We have developed the Responsible Corporate Citizenship Continuum (RCCC) to articulate the role of the private sector in society and to provide companies with a framework to conceive human rights and social and environmental responsibility in their business practices as well as CSR.”

Priya Naik, Founder and CEO, Samhita Social Ventures is interviewed by CSR Mandate where she shares Samhita’s strategies and learnings over the last 10 years while collaborating with a variety of stakeholder such as companies, social enterprises, NGOs, governments, multilaterals and donors. Samhita has curated a number of collaborative platforms to address challenges such as gender inequality, water and sanitation and sustainable livelihoods, with each contributing stakeholder honing their core competencies to collectively create significant impact. In response to COVID, Samhita set up the India Protectors Alliance (IPA) to provide support and equipment to India’s frontline health care and sanitation workers, and REVIVE to pave the path for sustainable recovery of jobs and livelihoods by providing financial and technical assistance.

Read the complete article

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