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Author: Samhita - CGF

Demystifying the CSR law: with Nishith Desai

Demystifying the CSR law: with Nishith Desai

Nishith Desai, founder of Nishith Desai Associates led an enlightening discussion on approaching CSR strategically, building knowledge about the CSR and the various legislations affecting the development sector. The discussion was held with CSR and sustainability heads of India’s biggest and most recognisable firms. This discussion was part of the release of Transforming India: The CSR Opportunity, a report by Samhita Social Ventures supported by The Rockefeller Foundation.

The Five Ways CSR Heads Can Create Lasting Change

The Five Ways CSR Heads Can Create Lasting Change

The  inaugural session of CSR Café was held on July 4, 2018 and at Cafe Zoe, and was facilitated by Luis Miranda, Trustee – Collective Good Foundation, Chairman – Centre for Civil Society and Chairman – CORO, The session was focused around the ‘The Five Ways CSR Heads Can Create Lasting Change.’

Participants shared their insights and experiences on managing multiple mandates as a CSR Leader, the struggle with engaging stakeholders, the need for more sectoral research and the potential for collaboration among themselves and with the government. The following is a summary of themes explored:

  • The role CSR plays in addressing social issues has evolved. CSR leaders, the board and other stakeholders must now re-assess their definitions and approaches to CSR, and explore how it can play a role in inspiring change and social action in the wider ecosystem. This re-alignment must become part of both strategy and implementation for CSR to become an effective catalyst for social change.
  • Effectively communicating about CSR can build engagement with internal and external stakeholders, and keep them invested in the organization’s CSR activities.
  • Many articulated the need for continuous, rigorous research that analyzed what was going right, and how to manage what was going wrong. Forums such as CSR Café and a seminal industry publication, are required to share research and explore areas that need research while identifying relevant tools, models and resources.
  • Collaboration is the way forward for many. Of the many forms of collaboration, the following were the most commonly articulated:
  • The Government while being the largest delivery agent for social welfare, struggles to deliver effectively to the last-mile. Companies could bridge this gap by using their expertise and CSR funds to help the government deliver its solutions to the end beneficiary; and help beneficiaries access the government’s social welfare pool.
  • The sheer jump in the number of CSR interventions has led to replication of efforts with little cross pollination or dialogue. Companies, by working together, could increase the scope and scale of their CSR and impact. For instance, small companies can scale up effective solutions, while larger companies can create and sustain stronger grassroots network & linkages.

Follow us on social media to keep updated about the valuable learning from this formidable community of CSR leaders. If you and your company are interested in participating in this forum, do reach out to us at team.comms@dev.samhita.org.

Investing CSR in Incubators – A Unique Model of Partnership

Investing CSR in Incubators – A Unique Model of Partnership

Authored by P.R. Ganapathy, President ( India), Villgro Innovations Foundation 

After, USA and China, India has the largest incubator and accelerator ecosystem in the world. But few companies have sufficient information on this ecosystem to be able to invest in it.

Samhita, and Villgro, supported by GIZ are addressing this information asymmetry and facilitating partnerships between companies and incubators and social enterprises(SEs).

The traditional model of CSR involves selecting an NGO working in an area of your interest (livelihoods, education, etc.) and funding them for a specific project, say, training 500 women artisans, or setting up a computer lab in a school.

But, the smart CSR managers of today are asking harder questions of this model.

What happened to those women artisans after the training was completed? Who buys their products and connects them to consumers? Is the model sustainable? What do children actually learn from the computer lab? Who teaches them? What content is available? Who maintains the computers and the lab to ensure it continues to deliver value?

One way to find these answers is to partner with social enterprises or for-profit entities who use market-based approaches to solve social problems.

The next logical question is : “Is it legal?” Does the Companies Act permit CSR funding to be used for support for-profit social enterprises?

The answer is a resounding Yes! Under Section (vii) of the Companies Act, CSR funds can be used to support Government-approved Technology Business Incubators (TBIs) located within academic institutions. A subsequent clarification also specifies that any TBI can be supported using CSR funds.

So, why should your company invest its CSR in social enterprises and incubators?

Innovation: Social enterprises, by definition, use innovative approaches to solving social problems. From the Biosense non-invasive anemia measurement device to the Adhyayan school transformation rubric, these enterprise use fundamental new ways of approaching social challenges, with significantly better outcomes.

 More resources:Because social enterprises attract financing from impact investors, they have significantly more resources than traditional non-profits or NGOs. This allows them to leverage your CSR money for much greater impact.

Focus on talent:More resources and a for-profit structure means the ability to pay better salaries, and attract the talent they want. They can also offer stock options. We’ve see our social entrepreneurs capitalize on the start-up craze to attract experienced and seasoned talent, leading to significantly better execution.

Sustainability:Because social enterprises have a revenue model, they have high potential for sustainability. Which means that even after your CSR funding project finishes, their solution and service continues to live on.

Scale: The combination of a sustainable revenue model, more resources and focus on talent means that these organizations have the potential for scale far greater than the traditional NGO/Non-profit model. Which means that the small amount of CSR funding you provided at the beginning is leveraged multi-fold, to achieve outsized, national-level scale and impact.

How should your company engage with social enterprises through a TBI ?

From my experience working with many corporates and social enterprises, I believe there are five dimensions to consider while designing your engagement.

Money: Social enterprises need money, especially at the early stages when they’re being incubated by a TBI, to hire the initial employees, develop their product, test-market their solution, etc.

You could fund a TBI to fund a social enterprise in four different ways:

  • Select a specific company from their portfolio that aligns with your CSR priorities – for example, agriculture or education. Your MOU with the TBI then specifies which social enterprise the funding should go to, and perhaps also what that funding should be used for and the milestones that should be achieved. Most CSRs currently work in this model.
  • Select together from a pipeline that the TBI surfaces around your CSR theme areas — you’re leveraging the TBI’s network and processes for selection and diligence, and also having a say in the process by participating in their “Investment Committee.” This way you can fund new ideas, and yet have a say in the process. Marico worked with Villgro to find and select a social enterprise working in the field of diabetes, their focus area.
  • Provide an open grant and leave it to the TBI to select and incubate enterprises within your theme areas. This stage implies you have developed trust in the TBI’s selection processes, and can depend on them to find good enterprises that fit your mandate. A corporate recently engaged Villgro to find and support skill training social enterprises, which is their CSR theme area.
  • Fund the TBI’s program costs like incubation staff, mentors, knowledge building sessions, etc., and not fund incubatees directly. This often allows the TBI the flexibility to provide the much-needed handholding that plays an equally important part in the incubation process. A large IT multi-national in Bangalore funded IIT Bombay’s incubator for the costs of running an accelerator program.

Mentoring: Your corporate has several experienced, seasoned, senior executives, and social enterprises are often founded by relatively inexperienced founders who are trying to do something radical to solve a social problem. In our experience, mentoring from senior executives is at least as valuable as the funding we provide our incubatees. By engaging your senior management in mentoring these entrepreneurs, you’re giving them a chance to “give back” while adding significant value to the incubatee. Mphasis senior management were closely involved with one of Villgro’s incubatees, providing mentoring and guidance.

Expertise: You may have technical experts in your organization who can add great value to social enterprises by giving them advice from time to time. For example, GE’s 5.38 accelerator for med-tech social entrepreneurs provides access to technical experts within GE Healthcare. That sort of expertise is hard to come by, or well-nigh impossible to access, and can significantly assist a med-tech social enterprise in product development. Your employees also benefit by using their expertise for social good, and it enhances their sense of goodwill for their employer, because they can witness first hand the social impact of their company’s CSR program.

Facilities: A social enterprise, especially one working on an innovative new physical product like a medical device, doesn’t have the capital required to invest in labs, fabrication facilities, etc. However, it does need access to these facilities for product development. Corporates have these assets, and they are generally under-utilitized. By creating a way by which social enterprises can leverage these facilities, you could provide they a valuable and timely resource that reduces the cost, improves the quality, and cuts the time of product development.

Go to market: Lastly, social enterprises need partnerships to take their products to market. Established distribution channels are often out of their reach, because of their innovative product, lack of market demand, and low marketing resources. A corporate that can distribute a social enterprise’s product through its own distribution channels will provide that social enterprise significantly value. A large agri conglomerate’s recent tie-up with one of Villgro’s agriculture social enterprises is an example of how this could work.

In conclusion, we’re seeing the shift from tactical, project-based CSR, to strategic, programmatic CSR. By adding social enterprise support to your CSR program, and engaging corporate resources such as senior management mentors, technical experts, leveraging facilities and using distribution channels to make the support strategic, you can maximize your impact and effectiveness.

Interested? GIZ, Villgro and Samhita are working to help Corporates find TBIs and engage with them. So, if you are a corporate or an incubator, looking to explore new horizons of partnerships, get in touch.

Optimising CSR for Rural Development

Optimising CSR for Rural Development

According to the 2011 census, 69 per cent of India’s population lives in rural areas, amounting to roughly 833 million people. The reality of rural India is far from the idyllic scenes of bucolic farmlands. However, there is a significant role that CSR can play if employed effectively.

Read Samhita’s analysis on the challenges and opportunities for CSR in rural development, as part of the 12th International Conference on Corporate Social Responsibility & Presentation of Golden Peacock Awards.

Click here

Beyond Safety Nets: Navigating India’s Social Protection Landscape

Beyond Safety Nets: Navigating India’s Social Protection Landscape

In the vast and diverse landscape of India, a multitude of social protection schemes have been crafted to support the country’s extensive informal workforce. These programs hold the promise of offering a safety net to millions of individuals and families navigating the precarious terrain of informal labour. However, many of these schemes remain underutilised due to various constraints. This blog delves into India’s pressing need for social security programs, the obstacles impeding their adoption, and innovative models to enhance access. 

 

In times of personal crises or livelihood disruptions, Social Protection Schemes serve as a cornerstone for individuals and their families, offering a path to prosperity through economic growth and inclusion. These programs provide the resilience needed to rebound and shield individuals from the debt traps that often perpetuate poverty cycles. They  empower marginalised communities to achieve overarching goals such as promoting social inclusion and ensuring income security.

 

From Obstacles To Opportunities: Sachita Bhoir’s Success Story

Group of women from rural area

Amidst India’s rural landscape, Sachita Bhoir’s traditional life faced a challenge – the absence of a common service centre for government schemes in her village, Chane. To bridge this gap, the team at Samhita-CGF conducted a field visit, which became a big turning point for the village’s residents. 

Through painting courses, the experts provided community members with information on various social security schemes like Sukanya Samridhi Yojana (SSY), Atal Pension Yojna (APY), Pradhan Mantri Suraksha Bima Yojana (PMSBY), and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY). 

Sachita’s interest in the SSY scheme was evident, as she wanted to secure her daughter’s future. Unfortunately, there wasn’t a bank within the village that could help her with the necessary paperwork. So the team reached out to the nearest branch of a bank and proposed organising a camp, to bring door-to-door banking services for the community members. During the camp, Sachita successfully linked her mobile number with her bank account and applied for the scheme. Her determination, combined with the unwavering support of the team, yielded positive results.

Sanchita’s story serves as a significant illustration of the importance of closing the divide between community members and the government’s social security initiatives.

 

The Need for Social Security Programs in India

The Need for Social Security Programs in India is an issue of paramount importance, given the challenges faced by the vast informal workforce in the country. This group comprises an astonishing 92% of India’s labour force, encompassing casual and contract labourers who toil across a wide array of industries. Unfortunately, they operate outside the scope of formal employment benefits, leaving them vulnerable to a multitude of economic shocks and uncertainties.

This demographic of informal, blue-collared workers further highlights the issue of systemic marginalisation that urgently requires attention. An estimated 72-76% of non-agricultural workers within this cohort find employment in industries like construction, retail, manufacturing, and wholesale. These industries often expose them to various occupational hazards, and many of them possess limited educational qualifications, exacerbating their economic vulnerability.

Women within the informal workforce face even more formidable challenges, such as sexual exploitation, lower wages, and diminished bargaining power, further compounding the issues of inequality and social exclusion.

Despite the Indian government’s commendable efforts to provide a wide range of social security programs, a significant portion of eligible individuals remain either unaware of these crucial safety nets or lack the knowledge required to access them. This awareness deficiency is striking, with approximately 55% of individuals having no knowledge of the government’s social security initiatives.

Furthermore, the issue of inadequate access is a matter of critical concern, as an astonishing 88% of India’s labour force, approximately 400 million people, presently lacks proper access to these essential social security programs. This substantial disparity between the existence of these programs and their successful extension to those in need underscores the urgent requirement for holistic solutions to close this gap and safeguard the well-being of India’s informal workforce.

 

The Effects of Inadequate Social Protection

The limited access and utilisation of social protection schemes have had significant consequences. There’s room for improvement in financial inclusion, with approximately 15% of small businesses currently having access to essential financial products and services like affordable bank credit. 

India’s performance in the United Nations Sustainable Development Goals (SDGs) presents opportunities for growth, As highlighted in the 2021 SDG report, the country ranked 121st out of 169 nations. While there is work to be done, India’s commitment to SDGs like No Poverty (SDG 1), Zero Hunger (SDG 2), Quality Education (SDG 4), Gender Equality (SDG 5), and Reduced Inequality (SDG 10) indicates a clear need for enhanced social protection measures.

The development of robust safety nets can bolster individual resilience during unforeseen crises. The insurance penetration rate, currently at 3.2% in India according to the Economic Survey 2022-23, presents an opportunity for growth. 

Rural areas, in particular, can benefit from increased access to life insurance products, where only 22% of the rural population currently holds such policies. This highlights the need for comprehensive social protection reforms to bridge these gaps and enhance financial security for all.

 

A Comprehensive Approach for Social Protection

To address these multifaceted challenges, a comprehensive social protection system becomes essential. Such a system must provide robust protection throughout an individual’s entire life cycle, combining a variety of assistance mechanisms and aligning them with government priorities. 

Stages of Social Protection System

 

Models to Facilitate Access

The adoption of innovative models is crucial to overcoming the barriers hindering access to social protection programs, and two notable approaches have emerged:

  • Fixed Centre Model: One pioneering strategy is the Fixed Centre Model, which capitalises on Common Service Centers (CSCs). These centres are efficiently managed by Village Level Entrepreneurs (VLEs) and function as central hubs for unlocking access to various government entitlements, particularly for underserved populations. This approach synergises with the Digital India Mission, aligning itself with the nation’s broader digital transformation goals. 

It operates through multiple touchpoints spread across the vast expanse of India, effectively fostering sustained access to social protection. By utilising the extensive network of CSCs and the expertise of VLEs, this model brings government support closer to those who need it the most.

  • Change Agent Model: Another innovative strategy is the Change Agent Model, which deploys camp-based initiatives in various settings, including workplaces and residential colonies. Under this model, a cadre of Community-Based Change Agents is trained to bridge the digital divide and facilitate access to government schemes.

These agents are well-versed in basic digital literacy, government programs, and the application process. Furthermore, they play a crucial role in fostering Community Champions who emerge as local leaders, capable of mobilising their communities and imparting essential knowledge about government schemes and services. 

This model embodies an end-to-end facilitation approach, encompassing everything from initial awareness campaigns to hands-on assistance with application submissions and diligent follow-ups with relevant government departments. By embedding support within the communities themselves, the Change Agent Model empowers individuals, enhances awareness, and ensures a more inclusive and sustainable impact.

 

Empowering Communities: The Pathway to Social Protection

In the intricate tapestry of India’s social protection landscape, forging a clear path toward inclusive access is important.  Samhita-CGF has made a significant impact, reaching over 166,000 individuals across India. Our efforts have facilitated government scheme applications, including e-shram, BOCW, artisan cards, and various financial inclusion initiatives such as bank accounts, life insurance. Initiating this transformative journey necessitated a multifaceted approach that addressed the core challenges hindering social protection schemes  effectiveness.

Raising Awareness and Enhancing Accessibility: The cornerstone of this approach lies in democratising information. By making government schemes more accessible, transparent, and user-friendly, the barriers between citizens and vital services are dismantled. 

Community-Centric Focus: Within communities, a specialised focus, especially on women and their families, is pivotal. Understanding the unique challenges faced by these groups enables tailored solutions.

Comprehensive End-to-End Support: A robust support system, starting from document collection to scheme enrollment, is imperative. This holistic approach ensures that the complexities of bureaucracy do not deter individuals from availing themselves of their entitled benefits.

Continuous guidance ensures that beneficiaries navigate the system effectively, securing sustained benefits over time. Establishing multiple touchpoints, both physical and digital, guarantees that support is always within reach, eradicating the sense of isolation that often plagues those in need.

By overcoming challenges, nurturing communities, and cultivating a culture of support, the nation is actively advancing towards a future where social protection serves as more than just a lifeline – it becomes a driving force for comprehensive societal progress.

Within this vision, communities are not mere beneficiaries; they evolve into valued partners. Encouraging active participation and nurturing a cadre of Community Agents of Change transforms passive recipients into advocates. Aligning strategies with government priorities creates a cohesive, responsive system, ensuring that efforts resonate with national objectives. 

 

This article was editorialised by Aakriti Singh and Ayushi Bhatnagar

 

Empowering the Underbanked through the Innovative Pre-Credit Score Initiative

Empowering the Underbanked through the Innovative Pre-Credit Score Initiative

In a world striving for new innovations in pursuing holistic financial inclusion, Samhita-CGF takes a bold step forward with its innovative network alliance to bridge the credit gap faced by underbanked communities and micro-entrepreneurs. In partnership with SIDBI, CGTMSE, and NSDC, Samhita-CGF is introducing the Pre-Credit Score (PCS), an innovative credit scoring framework that empowers first-time borrowers. Unlike traditional scoring models, which rely on past credit history, the PCS delves into income and expense patterns, as well as lifestyle indicators, providing a comprehensive view of creditworthiness. This revolutionary approach opens doors for New To Credit (NTC) and New To Business (NTB) segments, offering them access to formal credit.

The challenge: Access to commercial capital

As per SIDBI, only 2.5 Cr. or less than 40% of the MSME have ever been provided formal credit, which means over 60% of this sector has no access to formal credit. This glaring credit gap persists, particularly in the informal sector, where businesses are often funded by non-transparent, high-interest informal sources. Further, there is a glaring gender disparity in credit usage. Women in India receive credit equivalent to only 27% of the deposits they contribute, while men receive credit equal to 52% of their deposits. 

Lending to underbanked individuals, especially those operating informal enterprises, has been a longstanding challenge. The lack of access to adequate and affordable credit faced by the informal sector enterprises is a typical market outcome of information asymmetry, adverse selection and moral hazard. These enterprises essentially have a ‘thin file’ character, with varying degree of quantity and quality of firm-level financial data.

Samhita-CGF recognizes the critical need to provide access to commercial capital for sustainable livelihoods. Given that the majority of our workforce falls under the informal economy, it is imperative to provide access to commercial capital that is able to create sustainable livelihoods for the unbanked. The pre credit score (PCS) aims to solve this. It assigns a risk-adjusted rating to an informal enterprise, the proprietor and the household. Feeding into the credit-guarantee backed loan, it allows for injection of sufficient growth capital to help alter the subsistence character of the informal enterprise. 

 

Samhita-CGF’s pre-credit score for informal sector

A pre-credit score represents the risk-weighted profile of the informal enterprise proprietor and his/her household. It uses a 4Cs framework – Capacity, Character, Collateral, and Connectivity. Below is a snapshot of the same.

Each of the four aspects offers unique insights into informal businesses, creating a comprehensive picture. It assesses creditworthiness by considering financial resources, educational background and other credentials, possession of assets, and access to digital platforms. The individual indicators within these dimensions work together to gather information about the borrower’s capacity and inclination to repay the loan.

4 C's Framework for Pre-Credit Score

 

 

Pre-credit score unlocking commercial capital through credit guarantees 

Samhita-CGF envisions a transformed landscape for informal workers and microentrepreneurs, where financial empowerment is not a distant dream, but a tangible reality. Through the REVIVE Alliance, established in 2020, Samhita-CGF has exemplified its unwavering commitment to this cause. 

This pioneering initiative stands as one of India’s most substantial philanthropically funded blended finance and livelihood acceleration facilities, expressly designed to uplift individuals and MSMEs operating within the informal sector. With over 5,50,000 informal workers and entrepreneurs, including more than 4,40,000 women, benefiting from REVIVE over the past three years, Samhita-CGF’s impact is a testament to its resolute dedication to promoting economic equity and sustainable livelihoods. 

As 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. In partnership with CGTMSE, Samhita-CGF are co-creating India’s first new to credit (NTC) and new-to-business (NTB) focused credit guarantee scheme, to support entrepreneurs obtain access to formal credit. While credit guarantee schemes are not new to India, this scheme will be targeted to supporting only NTC and NTB entrepreneurs to provide a pathway to graduation to the formal economy. 

Through this systematic approach, 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 PCS will be used as a proxy for a formal credit rating and be required as a scheme prerequisite.

Samhita-CGF’s pre-credit score framework is a beacon of hope for millions in the informal sector. By extending lending opportunities, we aim to create sustainable livelihoods and promote economic equity. The initiative draws inspiration from data-driven insights and embraces collaborative synergy with external partners and industry experts to build a robust scoring model.

 

This article was authored by Varnika Jain and Abhishek Gupta

Bridging the Gap: Skilling Initiatives for a Changing Workforce

Bridging the Gap: Skilling Initiatives for a Changing Workforce

In India, the need for skilling initiatives is paramount, as they hold the key to equipping individuals with the essential skills required to thrive in a rapidly changing job landscape. This blog delves into the challenges faced by Skilling programs that hinder the program effectiveness. It also highlights Samhita-CGF’s innovative approach to tackle these obstacles, emphasising on the significance of skill development in driving individual success and broader economic development in the face of rapid change.

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India’s demographic dividend, characterised by a youthful population, could potentially be a significant driver of economic growth. However, to harness this effectively, India needs a skilled and job-ready workforce. Unfortunately, India’s current skilling ecosystem grapples with a multitude of challenges that hinder its capacity to prepare individuals for the demands of the modern job market. In this context, let’s delve into the challenges confronting India’s current skilling ecosystem and explore potential solutions to address them.

Young adult learning tailoring

 

Challenges with India’s Current Skilling Ecosystem

1. Limited  access to skilling programs  

 A significant stumbling block in India’s skilling journey is  the inadequate access to programs. Geographical barriers, lack of infrastructure, and financial constraints often stand in the way. This exclusion hampers social mobility and perpetuates income inequality. Empowering marginalised communities with readily available and affordable skilling initiatives is imperative. 

2. Need for Greater Accountability for Training Institutes or Participants 

One of the most pressing concerns within India’s skilling sector revolves around accountability. Numerous training institutes currently fail to deliver high-quality capacity-building opportunities, resulting in a lack of motivation among participants. To address this issue effectively, there is a critical need to establish stringent quality standards and implement robust monitoring mechanisms. 

3. Lack of Placement Focus and Post-Placement Support

Insufficient emphasis on placement support and post-placement assistance within current skilling initiatives leaves a critical gap in the journey towards gainful employment. To address this deficiency, skilling programs must pivot their attention towards providing essential resources like financial aid, mentorship, and networking opportunities for facilitating a seamless transition into the workforce.

 

A  holistic approach for empowering the workforce

India’s diverse workforce necessitates a multifaceted approach, encompassing financial aid and technology. These comprehensive strategies enable individuals to excel in an evolving work environment and navigate the challenges of the modern world, fostering sustainable progress.  

  1. One Individual, Multiple Interventions: It is crucial to provide a range of tailored interventions aligned with different stages of an individual’s career journey. These encompass skill-focused training, financial accessibility, and workplace support.
  2. Access to Finance for Skilling: Overcoming financial barriers necessitates a gradual approach to financial assistance, encompassing initiatives like returnable grants and loans with credit guarantees. This empowers individuals to invest in skill development without financial constraints.
  3. Create Public Goods for the Good of Everyone: Emphasising the creation of public goods that benefit not only individuals but also the broader skill development ecosystem is essential. Innovations such as pre-credit assessments boost confidence among ecosystem participants, supporting first-time borrowers.
  4. Skilling for Sustained Labor Force Participation: Emphasising the significance of ongoing skill enhancement, it is essential to provide comprehensive, long-term training programs that equip individuals not only for career transitions but also for rapid advancements in their professional journeys.
  5. Technology to Accelerate and Sustain Impact: Harnessing technology plays a pivotal role in expanding the reach and sustainability of these efforts. Advanced tracking systems facilitate progress monitoring, streamline onboarding, and provide ongoing support to workers throughout their career lifecycles.

 

 

Our skilling initiatives have made a significant impact, training over 52,000 individuals across 16 states through a network of 70+ centres, with a commendable 70% placement rate.

 

Skills for Life-Program

Acknowledging that India’s economic prosperity and global competitiveness relied on a skilled workforce, HSBC partnered with Samhita-CGF to initiate the Skills for Life Program. This dynamic initiative was designed to uplift unemployed and underskilled youth from disadvantaged socio-economic backgrounds. The program addressed the specific needs of these individuals by providing training opportunities for aspiring drivers while also equipping them with necessary skills to excel as General Duty Assistants within the health sector. 

HSBC - Samhita Skilling workshopSamhita - CGF Skilling workshop


Covering a wide spectrum of 330 participants across three states – Delhi, Haryana, and Tamil Nadu – across 7 dedicated centres, this program served as a holistic training solution for young individuals, nurturing both their personal and professional development. Beyond the in-depth training, participants also received certification and benefited from the job placement support, enriching the education of unemployed youth with invaluable practical expertise.

By empowering individuals across various profiles, providing access to finance, and leveraging technology, Samhita-CGF is making a significant impact in bridging the gap between education and employment, ultimately contributing to India’s economic growth and development.

 

This article was editorialised by Aakriti Singh and Ayushi Bhatnagar

 

 

Small-Scale Financial Literacy Projects: Catalysts for Transformation

Small-Scale Financial Literacy Projects: Catalysts for Transformation

Financial literacy has long been recognized as a key driver of economic growth and prosperity. This blog delves into the urgent requirement for financial literacy programs in India, especially in the backdrop of remarkable economic progress. Despite the broader accessibility of financial services, a substantial portion of the population lacks fundamental financial knowledge. The blog underscores how these programs can empower women, stimulate entrepreneurship, mitigate debt-related pitfalls, and contribute to economic advancement. It also examines the difficulties encountered by smaller-scale initiatives and draws valuable insights from REVIVE’s endeavors in promoting comprehensive financial empowerment. 

 

THE NEED FOR FINANCIAL LITERACY INITIATIVES IN INDIA

India’s financial system combines formal and informal elements, yet a significant portion of the population lacks basic financial access despite impressive economic growth. India has made notable progress in improving financial inclusion, leading to the creation of millions of new bank accounts. However, mere access to financial services falls short. Often overlooked is the essential aspect of financial literacy, with a substantial portion of the population lacking even a basic understanding of the financial system.

  1. Empowering Women: Women in India often play a pivotal role in managing the household budget and making financial decisions. Equipping them with financial literacy tools is crucial as it empowers them to make informed choices, not only about daily expenses but also about savings and investments. This, in turn, can lead to greater financial security for their families.
  2. Fostering Entrepreneurship: Financial literacy is a powerful tool for promoting entrepreneurship, particularly among women. When women entrepreneurs have access to foundational financial knowledge and are provided with small-scale business opportunities, they can create a significant impact on their families and communities. This can lead to economic growth and poverty reduction on a larger scale.
  3. Avoiding Debt Traps: Lack of financial literacy often leads individuals to make poor financial decisions, such as taking on high-interest loans or falling prey to unscrupulous financial practices. With better financial education, people are more likely to make sound financial choices, thus avoiding debt traps and financial distress.
  4. Enhancing Economic Growth: A financially literate population is better equipped to contribute to the overall economic growth of the country. When people understand the importance of saving, investing, and responsible financial management, they are more likely to participate in the formal economy, leading to increased economic stability and development.

Financial literacy in

CHALLENGES ENCOUNTERED BY FINANCIAL LITERACY INITIATIVES ON A SMALL SCALE 

 Small-scale financial literacy projects in India encounter a multitude of challenges that can hinder their mission to empower individuals with essential financial knowledge. These challenges include:

  1. Limited Funding: Securing adequate financial resources to sustain and expand their initiatives is a constant struggle. Small projects often rely on donations, grants, or volunteer efforts, making it challenging to maintain consistent operations.
  2. Lack of Awareness: Many small-scale projects struggle to reach their target audience due to limited marketing budgets. Building awareness about the importance of financial literacy and the availability of these programs is a significant hurdle.
  3. Behavioral Change: Encouraging individuals to adopt better financial practices and break existing habits is complex and time-consuming. It requires ongoing support and reinforcement.
  4. Evaluation and Impact Measurement: Demonstrating the tangible impact of financial literacy programs is crucial for securing future funding and expanding the reach, but it can be resource-intensive.
  5. Scalability: Expanding their initiatives to serve more people is a goal for most small projects, but scaling up while maintaining quality and impact is a delicate balancing act.

Rural couple making digital payment

REVIVE’S LESSONS FOR INCLUSIVE FINANCIAL EMPOWERMENT  

REVIVE’s commitment to empowering small-scale projects through transformative initiatives for financial inclusion and literacy has undoubtedly yielded valuable lessons that can be applied to drive larger-scale development. Here are some key lessons that can be drawn from REVIVE’s efforts:

  1. Localized Strategies: Recognizing the diversity of India, these projects emphasize the need for localized strategies and language-specific materials to effectively reach all segments of the population.
  2. Partnerships: Collaborations with local NGOs, government agencies, and financial institutions enhance the reach and impact of these projects.
  3. Technology Integration: Leveraging technology, such as mobile banking and digital financial tools, can greatly enhance financial literacy efforts, particularly in remote areas.
  4. Long-Term Commitment: Sustainable change requires a long-term commitment. These projects emphasize ongoing support and follow-up to ensure that financial literacy gains are retained and utilized.

Small-scale financial literacy initiatives are serving as a cornerstone in the empowerment of individuals, with a particular focus on women and communities across India. These projects are actively tackling the obstacles associated with financial literacy and offering tailored education and resources, ultimately making significant contributions to broader development and transformation efforts.

 

From Opportunity to Success: Microsoft’s Holistic Approach to Supporting Women Entrepreneurs

From Opportunity to Success: Microsoft’s Holistic Approach to Supporting Women Entrepreneurs

When it comes to keeping up with the digital age, women in India face several challenges, which have a significant influence on the growing digital gap in the country. Microsoft, through its CSR Program, has supported a total of 10,000 women entrepreneurs, with the last 5,000 beneficiaries benefiting from a comprehensive approach that includes digital and financial literacy, bookkeeping, mentoring, advanced training for participants, and access to government schemes, all of which are aligned with the theme of sustainable entrepreneurship.

Weaving Entrepreneurial Dreams, One Stitch at a Time: Manisha from Nuh, Haryana 

“After the program, I felt that in order to grow the business, I need to be educated further.”

 

Manisha, is a determined young entrepreneur, from Bichhor village in Nuh district, Haryana. At the age of 19, she found herself in a challenging situation where she had to drop out of school to support her family financially. The conservative environment in Nu district further exacerbated the impact on Manisha’s life as her family opposed her desire to pursue education. As a result, she was confined to her home, without any opportunities for formal learning.

Despite facing these challenges, Manisha’s determination led her to seek guidance from her sister, who was skilled in tailoring. She quickly learned from her and began taking orders directly from home. However, the income from her limited customer base within the village was insufficient. 

A major turning point for her was when she became a part of the REVIVE program, spearheaded by Microsoft. This program taught her how to utilise digital tools and effectively manage her cash flow, enabling her to expand the business and reach a larger customer base. Moreover, it made her realise the untapped potential of her own phone for conducting various business related activities beyond mere communication.

Additionally, the program’s impact extended well beyond the realm of business, positively influencing the overall wellbeing of the community. Nu district, known for its persistent problem of financial fraud and crime, had long been a burden on its residents. However, with the implementation of the REVIVE program, individuals like Manisha gained valuable skills to safeguard themselves from such incidents, fostering a newfound sense of resilience and empowerment that surpassed societal gender constraints. 

Encouraged by such transformative effects and positive changes within the community, Manisha’s parents had a change of heart and agreed to support her in pursuing higher education. This marked the beginning of a promising chapter in her life, where she could simultaneously nurture her business and embrace the educational opportunities she had longed for. 

Manisha’s case study exemplifies the impact of Microsoft’s holistic approach in supporting women entrepreneurs. By providing digital and financial literacy, access to tools and resources and mentoring, Microsoft has empowered women like her to overcome challenges, achieve business growth, and pursue their dreams. 

 

UNDERSTANDING THE CHALLENGES

Entrepreneurship among women is a vital component of the overall solution. However, women-owned enterprises in India face a number of challenges, including:

  • Inadequate access to skilling: Women entrepreneurs often lack the skills and training necessary to run a successful business. This might make it harder for them to compete with more established businesses.
  • Lack of market linkages: This may be attributed to a lack of knowledge of their products and services, as well as social and cultural barriers that restrict women from accessing the market. 
  • Limited access to finance: Women frequently experience difficulties acquiring loans or other sources of funding. This might make it difficult for them to establish or grow their businesses.
  • Socio-cultural barriers: Constraints such as inadequate access to skilling, lack of market linkages, limited financial access, and societal biases represent substantial hurdles for women entrepreneurs. These barriers impede their long-term viability and ability to innovate.

Moreover, the digital divide exacerbates these challenges, making it difficult for them to leverage technology for business growth and success. Therefore, addressing these challenges is essential to unlocking the full potential of women entrepreneurs.

 

MICROSOFT’S PROGRAM INTERVENTION

Microsoft’s CSR Program stands as a shining example of a holistic approach to bridge the digital divide and support women entrepreneurs in India. Recognising the significance of digital tools as a leapfrog intervention in economic empowerment. Microsoft aims to support women micro-entrepreneurs by providing them with the necessary tools and resources to thrive in the digital age. 

Initiated as a pilot program targeting 5,000 women entrepreneurs in rural India, with the goal of providing them with digital and financial literacy skills as well as the capacity to effectively operate, manage, and develop their enterprises. 

 

HOLISTIC SUPPORT FOR WOMEN ENTREPRENEURS

Using a blended support model, Samhita’s partnership with Microsoft has aimed to address barriers and strengthen the women’s entrepreneurship ecosystem across 10 states by focusing on the following key areas:

  • Digital and Financial Literacy (DFL): Capacity Building Sessions were conducted to enhance women entrepreneurs’ digital and financial literacy. These sessions covered topics such as concepts of banking, insurance, and using digital tools such as mobile devices, internet, social media, email, and awareness of e-security and safety.
  • Digital Bookkeeping Tools: Women micro-entrepreneurs were introduced to user-friendly digital bookkeeping tools that streamlined their financial processes. By using the tools, they were able to improve accuracy, enhance cash flow visibility, and make informed decisions based on real-time data. These tools, built on Microsoft Azure, provide flexibility so that they can be used both online and offline, ensuring accessibility even in areas with limited internet connectivity. 
  • Performance-linked incentives: To encourage and motivate digitization in the first phase, high-performing women entrepreneurs or those with progressive engagement were rewarded with incentives. 
  • Handholding support: To promote sustained use of digital tools, and follow-ups for additional resources or support.

 

THE PROGRAM’S OVERALL IMPACT

The first phase of the program successfully trained 5000 women entrepreneurs in digital and financial literacy, and provided them with access to user-friendly digital bookkeeping tools. These efforts yielded the following achievements:

  • 44.1% of participants continue to actively maintain digital account books for their businesses.
  • 62% of women began tracking their borrowing and lending by the end of the program as compared to only 27% at the start of the program. 
  • The number of women tracking inventory, banking operation, and payments increased by 10%, 14%, and 19%, respectively. 

A significant proportion of women entrepreneurs were able to digitize their bookkeeping practices, and were also able to obtain small formal bank loans because of these efforts. These included women entrepreneurs from various cohorts such as artisans, street vendors, dairy farmers and tailors.

 

SCALING UP AND ADDRESSING ADDITIONAL NEEDS

In the second phase, the program has been scaled up to support an additional 5,000 women entrepreneurs and it includes multiple interventions, in addition to digital literacy:

  • Access to Finance: Access to formal financial resources remains a significant challenge for women entrepreneurs, which was addressed by facilitating access to credit and connecting women with financial institutions. By building relationships with banks and fostering partnerships, the program enabled the participants to secure financial resources. This support empowered them to invest in their business, expand their operations, and achieve sustainable growth.
  • Social Protection: By unlocking relevant government schemes and services, women entrepreneurs were able to leverage them to access funding, business development resources, and market opportunities. This strategic approach propelled their enterprises forward by providing them with the necessary support and resources to overcome barriers.
  • Mentoring and Peer Support: Through mentorship, these women entrepreneurs received valuable guidance, industry insights, and access to networks, enabling them to make informed decisions and seize new opportunities. Additionally, the program created peer support networks that fostered a sense of community, allowing women to share experiences and learn from one another.

 

KEY LESSONS FOR DRIVING IMPACT

Microsoft’s program has provided valuable lessons for scaling up and replicating holistic support models for women’s entrepreneurship. There are two key lessons that have emerged from this program:

  • Customisation: It is essential to address the specific needs and contexts of women entrepreneurs. By tailoring interventions, organisations can effectively address the specific requirements of women entrepreneurs, increasing their chances of success.
  • Partnerships: Collaborations with financial institutions, government agencies, and community organisations create a comprehensive ecosystem of support that helps in offering assistance and guidance to women entrepreneurs in their businesses. 

 

These lessons serve as valuable guidelines for organisations aiming to develop impactful programs for women entrepreneurs, and Microsoft’s Program stands as a testament to the effectiveness of such an approach. Ultimately, when organisations combine tailored approaches with strategic partnerships, they can create an environment for women entrepreneurs to thrive.

This article was editorialised by Ayushi Bhatnagar and Evans Rebello.

The REVIVE Alliance – Creating A Sustainable Future For India’s Informal Sector

The REVIVE Alliance – Creating A Sustainable Future For India’s Informal Sector

 

India’s informal sector makes up a significant portion of the country’s workforce ~43% and provides employment opportunities for millions, especially those from the marginalized communities. 

However, despite its huge contribution to the economy, the informal sector operates without formal recognition. Currently only ~16% of all MSMEs have access to formal credit, creating a huge credit demand for working capital and capacity building support. This gap is further exacerbated for women, with 92.1% of women-owned MSMEs being unregistered / informal, and are therefore unable to access formal finance. 

As majority of the micro enterprises are either New to Credit (NTC) or New to Income(NTI), they are not deemed to be creditworthy, and are considered “high-risk customers” by formal lending institutions (LIs). 

This lack of support leaves individuals vulnerable to economic shocks, hindering their growth and preventing them from realizing their full potential.

Informal workers, including micro-entrepreneurs, have a huge potential to contribute to India’s economic growth, social progress, inclusive growth, and reduced poverty.

Samhita Revive Alliance clients

The REVIVE Alliance: A Catalyst for Change

Over 80% of solo, nano and micro entrepreneurs are either NTI, NTC, or New to Formal Credit (NTFC), have not completed basic KYC, GST, and other formalization activities, and do not have access to diverse markets. 

This shows the dire need for support from the private, philanthropic, financial and public sectors to band together to bridge this credit gap, and enable the rapid formalization and growth of these entrepreneurs. 

To support these efforts, Samhita-CGF founded the REVIVE Alliance, a collaborative platform that aims to increase incomes, improve livelihood opportunities, and enable the formalization of micro-entrepreneurs, making them more resilient to potential future shocks.

Through a multi-year, multi-intervention approach, REVIVE addresses critical challenges faced by informal workers, providing them with comprehensive support across 5 key interventions.

 

     1 . Financial Literacy and Inclusion

REVIVE focuses on enhancing financial literacy, facilitating access to formal credit through the Returnable Grant, as well as offering savings and investment support. 

Training programs and workshops are conducted to enhance financial literacy and promote savings habits. Additionally, REVIVE collaborates with financial institutions to facilitate access to formal credit and capital, catalyzed by the Returnable Grant that facilitates a graduation model. 

By enabling participants to navigate the financial landscape, REVIVE paves the way for financial inclusion and improved financial stability. 

 

     2. Skills Development and Job Progression

Limited skills and job opportunities often result in low wages for informal sector workers. REVIVE addresses this challenge by offering skill development programs that upskill / reskill job seekers and entrepreneurs. 

By partnering with training institutions, sector skills councils, and industry experts, REVIVE is able to deliver skilling programs to enhance technical and management skills, as well as entrepreneurial capabilities.

Woman artisan painting a pot

     

3. Enterprise Strengthening and Market Linkages

REVIVE aims to bridge this gap by providing enterprise development support and facilitating market linkages, so as to bridge the network gap and equip micro-entrepreneurs with the resources they need to thrive. 

Through these connections, micro-entrepreneurs are able to scale their businesses and expand their customer base.

     

     4. Digital Empowerment

REVIVE bridges the digital-divide through digital literacy and empowering participants with the necessary digital skills, covering topics like digital safety, financial tools as well as platforms that can help them with employment opportunities.  

Rural man and woman making digital payment

 

     5. Social Protection

REVIVE unlocks government schemes and facilitates access to affordable healthcare, insurance, pension schemes, trade-specific benefits and other social security benefits that provide a safety net for informal sector workers for income security and protection against unforeseen risks.

 

Fostering an Enabling Environment

REVIVE brings together a whole ecosystem of players – the government, corporates,, foundations, financial institutions, nonprofits, and other such stakeholders to create an enabling environment. 

Blended finance tools, such as the Returnable Grant, play a crucial role in providing NTC and NTI workers with access to capital on favorable terms, allowing them to invest in their businesses, scale their operations, skilling, get formal loans, etc. 

Through the co-creation of public goods, such as a pre-credit score, REVIVE aims to enable micro-entrepreneurs to access formal finance easily. The pre-credit score, backed by a credit guarantee, can be used by financial institutions to offer credit to first time borrowers, acting as a proxy for credit ratings and proof of ability to repay.

 

Impact and Potential for Scale

The REVIVE Alliance has the potential to create a transformative impact on the lives of millions of informal workers. By enhancing their livelihoods through improving access to finance, and enabling skills development, REVIVE aims to uplift micro-entrepreneurs and drive socio-economic progress. 

The ripple effect it can create extends beyond the immediate participants, positively impacting their families and communities.

With an initial target of impacting 10 million individuals, the REVIVE Alliance aims to scale its interventions and reach an even larger segment of the informal sector in the coming years.

By empowering informal workers through financial literacy, skills development, enterprise strengthening, and digital empowerment, REVIVE aims to build a thriving future where every individual has the opportunity to succeed and reach their full potential.

 

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Nagar, Goregaon East, Mumbai,
Maharashtra 400063, IN

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