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Category: Sustainable Livelihoods

Strengthening Communities: Introducing the Four Vital Indices by 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

Mobilising Resources for Women Entrepreneurs: The Women Entrepreneurship Development Program

Mobilising Resources for Women Entrepreneurs: The Women Entrepreneurship Development Program

Mobilising Resources for Women Entrepreneurs: The Women Entrepreneurship Development Program

Mobilising Resources for Women Entrepreneurs:
The Women Entrepreneurship Development Program

In today’s rapidly evolving world, empowering women to embark on entrepreneurial journeys is crucial for driving inclusive economic growth and societal progress. This blog explores the pivotal role of skill enhancement in enabling women to succeed as entrepreneurs, and various aspects such as financial and digital barriers for women entrepreneurs in India. Central to this narrative is the Women Entrepreneurship Development Program, a collaborative initiative with DXC Technology, which equips women with the knowledge and resources needed to navigate the entrepreneurial landscape.

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In communities worldwide, women often face limited access to formal employment opportunities due to various socio-economic factors such as lack of education, mobility constraints, and gender norms. Micro-entrepreneurship offers a pathway for women to generate income and contribute to the economic development of their communities.

The ‘Women Entrepreneurship Development Program: Promoting Inclusion and Financial Empowerment,’ a collaborative effort by Samhita-CGF and  DXC Technology,  stands out in this regard. This program is not just about skill development ; it aims to transform  the entrepreneurial landscape, enabling women to flourish in the business world.

Addressing the Financial Challenges of Women Entrepreneurs in India

Micro, Small, and Medium Enterprises (MSMEs) are pivotal to India’s economy, significantly contributing to both employment and GDP. Despite their vital role,  women entrepreneurs within the MSME sector face numerous obstacles that hinder their growth and sustainability. 

In India, there are approximately 15 million women-owned MSMEs, however, about 90%  of these women entrepreneurs haven’t accessed formal financial institutions for funding. This challenge has been intensified by the COVID-19 pandemic, which disproportionately affected women entrepreneurs, particularly those who lacked access to formal financial support networks.

In rural spaces, the dynamics differ significantly. Here, women entrepreneurs face unique challenges stemming from limited access to resources, infrastructure, and markets. Unlike urban environments, rural and semi-urban areas may lack established business networks and support systems, making it difficult for women to start and grow their ventures. The need for tailored financial literacy programs becomes important to not just foster inclusivity but also for driving economic development at the grassroots level, ensuring women entrepreneurs can thrive and contribute significantly to India’s economic landscape.

Leveraging Digital Technology for Empowering Women Entrepreneurs

Skill enhancement efforts delve into the realm of digital literacy to equip women with the tools they need to thrive in modern business environments. Recognizing the disparities highlighted by the program, where only 29% of women in India are digitally literate compared to 59% of men, it’s evident that bridging this gap is essential for inclusive economic growth.

Moreover, in addressing the financial hurdles encountered by women entrepreneurs in India, digital technology plays a pivotal role. Educating women on digital payment systems facilitates secure transactions, while insights into data analytics empower them to make informed decisions about their businesses’ financial health. By integrating digital literacy components into skill enhancement programs, women entrepreneurs are equipped not only to navigate the complexities of the digital realm but also to overcome financial barriers and thrive in dynamic business landscapes.

Women Entrepreneurship Development Program: A Case Study for Transforming Communities 

The program stands as a comprehensive blended learning initiative aimed at empowering women to embark on successful entrepreneurial journeys. Spanning 100 hours across three phases, this initiative is meticulously designed to equip women with the knowledge, skills, and resources necessary for entrepreneurial success.

  • The first phase is characterised by nearly 500 women also known as Village Level Entrepreneurs (VLEs), who are given training in Financial Literacy, Digital Literacy, and Menstrual Health Education.
  • From the initial group, champions are identified from the trained VLEs for the second phase. These champions will serve as leaders responsible for building the capacity of future entrepreneurs by facilitating and mentoring future participants.
  • The trained women from the second phase will further identify, enrol, and train 300+  future women entrepreneurs in the third phase. These women will acquire skills and accelerate livelihoods through four distinct skill sets: Fashionpreneur, Edupreneur, Spoken Tutorial and Swasthya Sakhi.

The program’s innovative approach not only focuses on individual skill development but also emphasises community transformation and leadership development. By empowering women to become entrepreneurs and mentors in their communities, the program aims to create a ripple effect of empowerment, driving societal change and economic growth. 

It’s time we realise that when women succeed, communities flourish, underscoring the transformative impact of women’s entrepreneurship on society at large. Only through comprehensive and targeted efforts can we truly unlock the full potential of women entrepreneurs across the spectrum of our society.

This article was authored by Aakriti Singh and Ayushi Bhatnagar

Empowering Women Entrepreneurs: Unveiling the Women Economic Empowerment Index

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

Can the Microcredit Model Be Improved?

Can the Microcredit Model Be Improved?

The problem here is not a lack of microcredit programs or their execution but rather something in the model itself. This leads us to ask: Can we modify or extend certain aspects of the microfinance model to achieve better outcomes for recipients?

Vikas Dimble, Director of Knowledge and Research at Samhita and Ahmed Moshfiq Mobarak, Professor of Economics at Yale University write on how microcredit can be used to help poor communities pull through unexpected shocks if the microcredit model is modified to incorporate inclusivity and flexible lending practices.

Click here to read the article

Innovative lending practices can improve traditional microfinance

Innovative lending practices can improve traditional microfinance

Research on the traditional microfinance model reveals the alterations that can be made to further small businesses and welfare gains. Vikas Dimble, Associate Director of Knowledge and Research at Samhita, and Ahmed Moshfiq Mobarak, Professor of Economics at Yale University emphasize the importance of flexible lending models, using local information to select eligible beneficiaries and allowing beneficiaries to make use of microcredit beyond entrepreneurial purposes.

Click here to read the article

The most vulnerable dictate the strength of our value chains

The most vulnerable dictate the strength of our value chains

COVID-19 has exposed the weakest links in our supply chains, the largest impact of which has been felt by the poor. As we rebuild rural livelihoods, we need to innovate towards decentralisation, write Harish Hande and Jeffrey Prins in India Development Review (IDR).

While we take a fresh look at how we innovate in value chains, they need to be understood from the perspective of the most vulnerable.

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Empathy and economic sense call for direct cash transfers

Empathy and economic sense call for direct cash transfers

During a Leaders with Purpose webinar hosted by Samhita and IDFC Institute on 11 May 2020, Nobel Laureate and Director of J-PAL, Esther Duflo emphasized that direct cash transfers to the poor is both the morally correct and economically wise action required to be taken by larger society.

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Protecting human capital to emerge from the crisis

Protecting human capital to emerge from the crisis

Corporate leaders recommend fortified social security provisions for gig economy workers. Business leaders called for reimagined approaches to social security and employer-employee relationships in the gig economy in light of the gaps that the COVID-19 crisis has revealed.

The revival of the informal sector is crucial to our economy

The revival of the informal sector is crucial to our economy

‘It is evident that there are strong linkages between the formal and informal, as well as between large and small segments of the economy. In order to comprehend the extent and scale of these linkages, it is important to take a closer look at the labour force participation data for the Indian manufacturing sector.’

LSE’s blog article serves as an important reminder that India must make the effort to secure its supply chains, especially in the manufacturing sector.

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