Can we distribute the burden of recovery from the pandemic more equitably?

As India and the world prepare for any successive waves of COVID-19, many have still not recovered from the economic impact of the previous ones.

Moving forward, we should keep the needs and experiences of the most vulnerable at the center of our approach. While many have shown and continue to show tremendous self-reliance, there is a crucial need to reduce the burden of recovery on individuals.

This article details policy recommendations to ensure a more resilient future for India’s most vulnerable communities. It follows three business owners in India whose livelihoods have been crippled by the COVID-19 pandemic. All of them are participants of the our REVIVE initiative.

Returnable grants: Reimagining credit for a better normal

The pandemic and its harsh impact on informal workers and macro and nano enterprises inspired the creation of the Returnable Grant (RG).

RG is one where there is no legal obligation to repay; the expectation is only ‘moral’, i.e., the recipient is encouraged to repay when she has achieved some intended milestones of financial recovery.

RGs are designed to fill a specific gap in India’s credit ecosystem for small businesses: dealing with short term emergency situations or external shocks.

Our CEO, Priya Naik and Varad Pande (वरद पाण्डे) from Omidya Network India write about how Revive Alliance is deploying the Returnable Grant to aid recovery and resilience of informal workers and small businesses in the recent edition of Economic Times.

The RG enables funders to benefit 5-7x the number of individuals when compared to a simple grant. Once an RG is repaid, it circulates back into the system to support others with similar needs.

A comprehensive learning and evaluation plan built into the REVIVE platform will provide further data on suitability, behaviours, utilisation and so on.

Using Blended Finance to sustain informal workers during Covid-19

According to the International Labour Organization, more than 400 million informal sector workers in India are at risk of falling into severe poverty due to the COVID-19 pandemic. This situation is exacerbated by the fact that informal workers have no health, social, or legal protections to fall back on. Without access to formal financing, their ability to survive serious economic shocks is handicapped.

This is the challenge that the REVIVE Alliance aims to address at its core. By bringing together industry leaders and philanthropic capital, REVIVE provides zero cost Returnable Grants and skill training to help India’s workers bounce back from the most severe economic crisis of the 21st century. 

To know more about how REVIVE and it’s parters are helping families and communities build sustainable livelihoods, read this article by our co-funder USAID. 

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