Expanding rural MSME credit: The SIDBI–RRB co-lending initiative

Access to timely and affordable formal credit remains a challenge for many micro, small, and medium enterprises (MSMEs) in rural and semi-urban India, particularly for small and first-time borrowers. To address this gap, the Small Industries Development Bank of India (SIDBI) and participating regional rural banks (RRBs) are piloting a co-lending initiative. The initiative combines SIDBI’s expertise in MSME finance and digital infrastructure with the extensive rural and semi-urban reach of RRBs. It seeks to create a more efficient, transparent, and scalable mechanism to expand productive credit for underserved rural MSMEs. 

The initiative is being piloted as a co-lending arrangement between SIDBI and participating RRBs. Both institutions jointly fund and service loans while sharing risk, returns, and responsibilities under an agreed framework. SIDBI provides access to low-cost funding and specialized MSME lending expertise. At the same time, RRBs contribute their extensive branch networks, local customer relationships, and deep understanding of MSME clusters and rural markets. Together, these strengths can help broaden access to formal credit for enterprises that conventional lending channels often underserve. 

The scale and potential of the initiative lie in its ability to combine institutional risk sharing, tailored MSME lending products, and an end-to-end digital lending journey. RRBs’ last-mile presence can enable faster and more transparent loan processing. The model can help reduce barriers to formal finance and improve the overall credit delivery experience for rural enterprises. As the model scales, it has the potential to support enterprise growth, strengthen local economic resilience, and generate employment across rural and emerging business markets. 

MSC (MicroSave Consulting) has been providing focused technical and implementation support to SIDBI for the launch and operation of the co-lending initiative. MSC works alongside SIDBI, participating RRBs, borrowers, and the digital lending platform provider. We have been supporting operational readiness through policy documents and product notes, user acceptance and scenario-based testing of the lending platform, and training and handholding for RRB staff throughout the loan onboarding journey. We also developed marketing and communication collateral in video and print formats to support awareness and adoption of the initiative. 

Through these interventions, we helped translate the co-lending framework into a practical, implementation-ready model that can be strengthened and scaled over time. The initiative brings together institutional expertise, digital infrastructure, and last-mile banking networks to address persistent gaps in rural MSME finance. The program has the potential to deepen access to formal financial services across more than 700 districts in India, with the participation of 28 RRBs and a combined network of more than 22,000 branches. It can also create a scalable pathway to expand MSME credit in rural economies. 

The project is funded by the Gates Foundation.  

Operationalization of an AI Sandbox for responsible AI adoption across public-sector departments in Haryana

Artificial intelligence (AI) can help governments improve public services. Yet, its use in public systems requires more than promising technology. Governments need a safe way to test if solutions are accurate, useful, secure, and accountable before they affect citizens or government decisions.  

The World Bank-supported AI Sandbox has created one such pathway in the state of Haryana in India. The sandbox provides a secure, governed environment where AI solutions can be built, tested, and validated for real government challenges using approved, controlled, or representative public-sector data. 

Located in northern India near Delhi, Haryana has active digital public systems and service-delivery workflows in which AI can support improved classification, prioritization, risk detection, and decision-making. MSC (MicroSave Consulting) worked with the World Bank and the Government of Haryana to identify opportunities for AI adoption. The MSC team engaged with government departments to understand their operational challenges, review available datasets, assess data readiness, and translate these needs into structured challenge use-case briefs for innovators. 

The identified use cases span multiple public-service domains. In education, AI can support teacher deployment planning and resource optimization. In healthcare, it can assist with TB screening and radiology-based decision support. In citizen services, AI can improve grievance classification, routing, and response management through Jansamvaad, Haryana’s citizen grievance platform. In infrastructure and utilities, it can support road defect detection through Mhari Sadak, Haryana’s road complaint and monitoring platform, and strengthen water quality risk intelligence for the Public Health Engineering Department.  

Following the challenge design phase, where use cases were refined into clear problem statements, data requirements, and application expectations, the Sandbox will open for applications from startups, technology providers, research institutions, and consortiums. MSC will support the development of application guidelines, evaluation criteria, and screening processes to identify solutions that show strong problem fit, technical feasibility, data readiness, and responsible AI practices. Teams selected through this process will then build and validate their solutions in the Sandbox using approved data and defined testing criteria, with successful solutions progressing toward pilot implementation. 

Monitoring and evaluation of the DPI-enabled social assistance delivery (Perlinsos pilot) in Indonesia

MSC conducted monitoring and evaluation (M&E) of the Perlinsos initiative’s pilot in Banyuwangi, East Java, in 2025 and 2026. The pilot’s goal is to evaluate the adoption of digital public infrastructure (DPI) for the end-to-end delivery of Indonesia’s flagship social assistance programs: Program Keluarga Harapan (PKH) and BPNT (Sembako)   

As a development partner that supports the evaluation, MSC assessed the pilot to generate evidence and recommendations for future scale-up. The M&E assessed the registration and grievance stages. It covered implementation processes across both stages, beneficiary journeys and perceptions, local implementation readiness, and the operational performance of the portal and its supporting technologies. 

The registration stage engaged more than 350,000 potential beneficiaries and 4,000 Perlinsos agents, which indicated a strong public interest in the on-demand registration model. 

The evaluation revealed that the Banyuwangi pilot achieved strong operational execution and validated the feasibility of the DPI-enabled approach. At the same time, it highlighted several operational challenges and proposed mitigation strategies to strengthen system security, operational safeguards, and implementation readiness before the initiative scaled up. 

The evaluation results have been officially shared with the Committee for the Acceleration of Government Digital Transformation and other development partners. It helped inform program improvements ahead of the pilot’s scale-up across 43 cities and regencies in Indonesia. 

Client: Committee for the Acceleration of Government Digital Transformation, Government of Indonesia 

Donor: The Gates Foundation

MSC’s support for DPI-enabled social assistance delivery through Perlinsos to reform Indonesia’s social protection system

MSC supported the Government of Indonesia in implementing the digital public infrastructure (DPI)-enabled social assistance delivery reform: The Perlinsos pilot. The Committee for the Acceleration of Government Digital Transformation led the initiative. Piloted in Banyuwangi, the initiative used digital identity verification and authentication along with interoperable data exchange to enable on-demand registration and grievance processes. The pilot also tested government-to-person (G2P) account nomination by beneficiaries to promote broader financial inclusion. 

As the committee’s technical partner, MSC has provided end-to-end support for the Perlinsos pilot’s design, implementation, and evaluation. This engagement has since expanded to include project management unit (PMU) functions, technical support for the Perlinsos portal, policy and regulatory advisory, and strategic guidance to support the reform’s scale-up and institutionalization.  

The pilot demonstrated the feasibility of using digital public infrastructure (DPI) to streamline beneficiary onboarding and improve the accuracy of social assistance targeting. In Banyuwangi, the pilot reached more than 350,000 residents and engaged more than 4,000 field agents. It generated the evidence needed to scale the Perlinsos model. Built on these results, the initiative is now being expanded to 43 cities and regencies as a key step toward nationwide implementation. 

Client: Committee for the Acceleration of Government Digital Transformation, Government of Indonesia 

Donor: The Gates Foundation 

Expansion of EV charging infrastructure in Indonesia: Financing pathways to roll out scalable and inclusive charging and battery-swapping stations

Indonesia’s transition to electric mobility is central to its net-zero targets by 2060, as the country’s transport sector accounts for nearly 23% of national emissions. The government has set ambitious targets of 2 million electric four-wheelers and 12 million two-wheelers by 2030. Yet, adoption remains limited.  

Only 359,000 EVs as of 2025 represent about 2.6% of the target. A key bottleneck is the severe gap in charging infrastructure. Fewer than 5,000 public charging stations are available against a target of 63,000, with most concentrated in urban regions, such as Java and Bali. High upfront costs, limited access to financing, and centralized institutional structures further constrain private participation and last-mile deployment.  

At the same time, MSMEs, particularly women-led enterprises, remain an untapped channel to enable decentralized, community-based infrastructure expansion. They account for more than 60% of micro and small businesses. 

MSC supports this push toward electric mobility and has developed a policy-oriented white paper on Indonesia’s EV ecosystem. The paper synthesizes the key bottlenecks that constrain EV charging scale-up, including operational challenges, institutional constraints, and financing limitations. Multiple stakeholders across the government, state-owned enterprises, EV developers, think tanks, and MSMEs have validated the white paper. 

The paper identifies the most feasible and scalable models for infrastructure expansion, presents priority recommendations for relevant stakeholders, and introduces an implementation plan. This plan would be operationalized within Indonesia’s existing policy and institutional environment to enable the participation of women-led MSMEs. 

MSC’s work will catalyze the operationalization of inclusive EV charging models, new EV supply chains, such as BaaS among others.   

Over time, this engagement will help enable more commercially viable and geographically distributed infrastructure that catalyzes EV penetration in rural Indonesia. It will simultaneously accelerate EV adoption beyond urban centers. The engagement will also strengthen women’s economic participation in the green economy and contribute to Indonesia’s broader clean mobility and climate transition goals. 

The Gates Foundation supports this engagement. 

Environmental safeguarding assessment for climate adaptation interventions in the Hindu Kush Himalaya (HI-CAS Project)

The Hindu Kush Himalaya (HKH) spans 3,500 kilometers across eight countries and supports critical freshwater, biodiversity, and ecosystem services for up to 2 billion people, which includes communities in Bangladesh, Bhutan, and Nepal. It serves as the headwaters of major transboundary river basins. This makes it central to regional ecological stability and sustainable development.  

However, the region is highly vulnerable to climate change, where rising temperatures drive glacial retreat and disrupt hydrological cycles. Communities in mountain areas depend on spring water as their primary source of drinking water and small-scale irrigation, yet its availability has fallen sharply across the region. 

Without structured safeguard assessments, well-intentioned interventions may cause unintended ecological disruption, exclude marginalized communities, or fall short of international compliance standards. Gaps in site-specific evidence constrain the ability of implementing organizations to manage risks, realize co-benefits, and align with national and donor requirements. 

The International Center for Integrated Mountain Development (ICIMOD) engaged MSC to conduct environmental safeguards (ES) and gender equality and social inclusion (GESI) assessments. These assessments were done across Nepal, Bhutan, and Bangladesh. This work was carried out under the HI-CAS project, supported by Global Affairs Canada. It focused on three key climate adaptation interventions: Springshed management, solar-powered irrigation, and agrobiodiversity practices. 

MSC conducted extensive review and mapping of  environmental risks, regulatory requirements, and co-benefits across different intervention types. This was followed by in country field work to engage with community members, indigenous peoples and local communities (IPLCs), farmers, water and forest user groups, and government representatives. MSC used  Driver-Pressure-State-Impact-Response (DPSIR) framework and developed site-specific environmental management plans (EMPs). Through  subsequent consultations and cocreation processes MSC refined the ES and GESI assessment of outputs and strategies. 

MSC delivered site-specific EMPs with mitigation measures, monitoring indicators, and compliance requirements. It also developed an evidence base to support environmentally sustainable and inclusive adaptation scaling across mountain ecosystems. 

The ICIMOD commissioned the project as part of the HI-CAS initiative, with support from Global Affairs Canada.