Samrudhi Micro Finance Society
Transcript of Samrudhi Micro Finance Society
SAMRUDHI MICROFINANCE SOCIETY
Divya Boddu-007
Dhaval Parmar-025
Sachin Lakade-032
Raj Saxena-035
Shiraj Sherasia-039
Teena Deuri-043
Zahid Anwar-048
INTRODUCTION- A VERY SAD SITUATION India is said to be the home of one third of the
world’s poor. The World Bank estimates that over 600 million people in India are below poverty line !!!
INTRODUCTION- THE BIRTH OF SAMRUDHI
To bridge this gap, SAMRUDHI set out its operations in Gulbarga District, Karnataka , in the month of May, 2007 by using a using a fast track model-drawn upon the positive features of 'Grameen' methodology'.
SAMRUDHI is non profit organization registered under the Karnataka Societies Registration Act, 1960.
Mr.Sanju Kumar, Founder & CEO
WHAT SAMRUDHI BELIEVES ?
SAMRUDHI believes that the “poor are bankable”; they have “credit discipline”, and they have potential to improve income and productivity and can make profit. Access to
basic financial services can significantly increase socio-economic opportunities for
poor families and in turn help improve their standard of living"
Mission “Our mission is to empower the poor and
underprivileged to become economically self-reliant by providing cost effective and need based financial services in a financially sustainable manner”
Vision“ SAMRUDHI's vision is to provide financial
services to 200,000 poor households in Indiaby 2013 and to become most preferred developmental & livelihood service provider.”
CULTURE & CORE VALUES Core values set the norms of behaviour for
everybody in the organization. The following Core Values are the basis of competitive advantage, but not the reason for just following them. Thus they need to be deeply held beliefs and are meant to be expressed through day-to-day behaviors of all.
Professional (in management), Proactive (positive & down to the business) & Prosperous (self-sustainable flourishing organisation)
Realistic (practical & down to earth), Receptive (open for new ideas & innovations) & Responsible (for what we do)
CONTD…. Strategic (in every action), Simple
(uncomplicated operations) & Speedy action
Transparent (in every action we perform), Trustworthy (to all the stakeholders) & Technology Savvy
Cooperative (with all the stakeholders), Competitive (in terms of products and services) & Customer oriented (to achieve satisfaction and delight)
Innovative (in products and processes), Instrumental (in implementation of objectives) & Influential (in policies)
KEY OBJECTIVES
To organize rural poor, Dalits, tribal women and underprivileged groups for their development and empowerment through community participation and to create opportunities for socially disadvantaged, distressed and economically poor to get livelihood support.
To offer cost-effective livelihood based financial services to the rural and urban poor households.
To become most preferred livelihood opportunity
provider in the operational area by establishing SAMRUDHI Micro Fin Society as a highly professional & suitable service organization.
GEOGRAPHICAL COVERAGE SAMRUDHI covers
eight district of northern Karnataka and expand into other part of the state and slowly expand its operation to the part of AP and Maharashtra & in the first two year.
SAMRUDHI has initiated operations through one branch office in Gulbarga town of Karnataka
ORGANIZATIONAL STRUCTURE
ORGANIZATIONAL STRUCTURE
Governance, experience and strategy
Management and operations
Financial
1 Well qualified and experienced board 2 Innovative and diversified products and channels to suit market needs 3 Good strategic change in terms of building the organisational structure
1 Improvement in the development of more secure and flexible information systems
2 Good tracking system for overdues 3 Well developed financial planning and control systems
1 Improvement in portfolio quality 2 Productive deployment of assets in the loan portfolio
3 High yield to APR
GROWTH
Samruddhi has had an interesting growth pattern over the last three years.
While the key indicators of scale – portfolio and number of active clients – have shown consistent growth, there has been a slight decrease in the average loan size since the last rating
Growth in the portfolio can therefore be attributed to an increasing number of clients rather than an increase in the loan amounts given to these clients.
STAFF PRODUCTIVITY
By comparison, staff productivity in terms of portfolio handled by the field staff, has declined
Due to a marked increase in the number of CSAs recruited
This increase in the number of CSAs was due to new units being opened in Maharashtra and AP.
PORTFOLIO QUALITY
There has been a marginal improvement in the PAR ratio for Samruddhi
Was mainly due to a rapid portfolio growth
The subsequent improvement in the ratio by about 0.5% is, therefore, a more realistic indicator of delinquency management
WHAT SAMRUDHI DOES… SAMRUDHI uses the pioneering Grameen Bank
(Bangladesh) model to provide Micro-Loans , Micro-Insurance to the poor.
SAMRUDHI provides small & manageable loans to the poor.
Its main targets are rural & urban poor women because they are the most marginalized and tend to use resources more productively than men do.
Women undertake small, manageable enterprises rather than risky ventures that could bankrupt families
OPERATIONAL METHODS SAMRUDHI adapted the pioneering Grameen
Bank (Bangladesh) approach to local modification.
It lends to five-member groups of women and designates the group member the ultimate guarantor of each of its members.
If one member does not repay, no individual in the group is eligible to receive another loan.
Default member’s loan has to be paid by remaining members of the group.
CONTD….
Social Collateral. The poorest do not have physical assets that can be used as security. Instead,borrowers organize themselves into groups that take collective responsibility for repayment of one another's loans.
Doorstep Banking. Providing financial services in the villages enables the rural poor to collect thatday’s wages and avoid the costs of travel to mainstream banks. The illiterate poor are also unable to complete loan applications, which often require several trips.
CUSTOMIZED PRODUCTS. SAMRUDHI designs loans with small, weekly
repayments corresponding to wage structures, consumption and income generating loans to prevent emergency “distress sales” and small first loans to inculcate credit discipline and collective responsibility. Interest and loan repayments are made equal for easy comprehension.
Focus on Women. SAMRUDHI works exclusively with women because they are the most marginalized among the poor and because they tend to invest the majority of their income into the household and for their children. Women also typically undertake small, manageable activities
CONTD….
Loan purposes
− Farm loans − Non-farm loans − General purpose loans
Delivery channels
− Direct to clients − Direct with Joint Liability Groups − Self-help groups − Through on-lenders
PRODUCTS AND SERVICES
IMPACT OF PRODUCTS AND SERVICES TO THE POOR
INDUCTING MEMBERS IN THE PROGRAM
CRITERIA TO JOIN THE GROUP
GROUP AND CENTRE STRUCTURE
PARTNERDonor:-Asha for Education:-It is a non profit,volunteer-run Action group
dedicated to radical change in India by focusing on basic education ,in belief that education is a critical requisite for socio-economic change
Indians for Collective ActionIt was founded in 1965 by Indian students in Berkeley. Its objective is to support innovative ,
community-initiated development projects that empower low income people in India.
LENDER
Sharada MACS & Thrift Ltd.Hyderabad based Sharada’s Women Association for Weaker Sections (SWAWS) supported SAMRUDHI through a Short-Term Loan of INR 0.7 millions through Sharada Mutually Aided Cooperative Society and Thrifts Ltd.
Initiatives for Development Foundation (IDF) Grassroot work for R&D IDF supported SAMRUDHI through term loan of Rs.2.2 million .
ASSOCIATION
Mix Market:- It is a global web-based MFI platform,
which provide information to various MFI network, public & private fund that invest in microfinance.
Sa-Dhan:- Sa-Dhan was designed and developed as
that platform to share, understand and learn the different perspectives, competencies and experiences, the source and legitimacy of the microfinance in India.
TECHNOLOGY
The heart of SAMRUDHI is in its Management Information System (MIS) integrated with accounts that enables the electronic capture of all transaction such as, loan, repayment, loan outstanding, credit history, trail balances at field staff & management level.
KEY FEATURES OF SAMRUDHI'S MIS
Captures socio-economic information of a client Tracks loans and savings transactions at the
field Generation of pre-computed and pre-calculated
values for expected transactions pertaining to a day
Automated posting of vouchers into Accounts Module
Configurable product, loan purpose, income and poverty definitions
Linkage to Performance Monitor Scalability – helps for rapid expansion
INFRASTRUCTURE
Samruddhi has an adequate infrastructure base of Rs 5.8 million as on 31 December 2009
The fixed assets mostly include computers and other such professional equipment and some furniture and office equipment
The utilisation of fixed assets is extremely appropriate and efficient.
KEY FEATURES OF SAMRUDHI'S ACCOUNTS MODULE Configurable Chart of Accounts Accounts can be defined at 3 levels Maintains day book, ledgers, cash book, bank
book etc Maintains financial statements like balance
sheet, income statement and trial balance Automated Year Closing and creates the
opening Trial Balance for the next financial year
Linkage to Performance Monitor
FINANCIAL PERFORMANCE
Samruddhi’s credit performance is reasonable with a cumulative repayment rate of 97.3%
The PAR60 has also been improving, though not adequately, over the previous ratings
Samruddhi’s portfolio is reasonably well diversified with about 48% of loans disbursed during the year for a variety of non-farm activities, 22% for cropping, another 22% in animal husbandry and agri-allied and a small 8% for housing and general purpose
MOBILISATION OF FUNDS
Samruddhi has diversified its lender base
Cash security, still continues to form an important source of funds and has increased to 8.9% of total liabilities and equity
This could be due to an approximate 40% increase in portfolio as well as the introduction of a cash security component across products
ASSET, LIABILITY AND EQUITY COMPOSITION
Samruddhi has utilised its assets well with 72% being deployed in loans and about 10% in short term investments
These investments have been made from the unutilised equity funds and the focus is on instruments that have minimum risk followed by those which give good returns
Due to their efficient investment policy, the organisation has a low cash balance of around 2%.
CONCLUSIONS
Strengths Weaknesses
•Well qualified and experienced Board • Innovative and diversified products and channels to suit market needs • Good strategic change in terms of building the organisational structure •
Low depth of coverage in existing villages
Organizational
MANAGERIAL
Strengths Weaknesses
•Professionally trained and stable managerial cadre • Improvement in the development of more secure and flexible information systems • Good tracking system for overdues • Well developed financial planning and control systems
•Relatively relaxed system for the appraisal of loan to SHG federations •The graduation of senior FXs to UHs has left the FX levels to relatively new staff
FINANCIAL
Strengths Weaknesses
•Improvement in portfolio quality •Productive deployment of assets in the loan portfolio • High yield to APR • Good equity mobilisation and capital adequacy •
•Moderate portfolio quality and continues to be weak in the older areas • Low ROA •
SUCCESS STORIES
Name:-Devaki. Took loan from
SAMRUDHI to invest in her vegetable business.
Now she earn 150-200 every day
SUCCESS STORIES
Name:- Shainaz Begum Availed Rs. 5000/- loan to
invest in seasonable businesses, such as mango, banana & grape sales.
SUCCESS STORIES
Name:-Gundamma Availed loan from
Samrudhi Earn 100-150 every
week
Thank You