The COVID-19 pandemic has brought upon us the responsibility to create awareness, influence precautionary behavior, and drive the safety of State Rural Livelihoods Mission (SRLM) staff members and SHG members. We have developed engaging training material for SRLM staff members and SHG members in the form of conversational comics on COVID-19. These explain preventive measures through accessible, visual narratives and include aspects of workplace safety at the SRLM office, staff safety in the field, and ensuring customer protection. These booklets can be customized by concerned SRLM based on their specific guidelines if required. Feel free to share them and join us in fighting back. #staysafe.
Around the world, gender diversity remains a huge challenge for businesses. The profitability of businesses is on average 34% higher when they are led by a woman, according to the Roland Berger study for Women in Africa. However, although data is lacking for Africa, estimates indicate that women lead only 9% of start-ups in the subcontinent. This is despite Africa’s position as the only region in the world that has more female entrepreneurs than male ones, with 65% of the continent’s goods produced by women. However, female entrepreneurship in Africa continues to face challenges, especially in the digital world where women are underrepresented.
The financial industry, however, is evolving. It increasingly relies on information and communication technologies (ICT) as well as on big data to meet customer demands for products that are quicker and easier to use, as well as more transparent. The financial industry has been moving towards products and services exclusively centered on the customer, which has forced institutions to rethink their business models.
Africa is at the forefront of innovation and entrepreneurship. The FinTech industry is booming. An increasing number of young Africans, born in the digital age, have embarked on the FinTech journey. The FinTech sector has started to find solutions through new business models to alleviate many basic challenges, such as water, electricity, education, and health access. FinTech companies use technology to reach a larger customer base while avoiding infrastructure expenses. Through these new business models, they can manage their costs more effectively and offer a range of affordable digital financial services.
Professional african woman-vector
However, only 27% of female entrepreneurs in Africa work in technology. Few women embark on the tech entrepreneurship journey, mainly due to lack of knowledge, lack of financing, or, simply, lack of support. They also lack female role models to follow.
Culturalbarriers play a major role in adding to the reluctance of women to take up tech entrepreneurship roles. African women are less inclined to take risks or are less able to take risks compared to men. Traditionally, they are seen as the ones who manage their households, not the ones who take risks. Culturally, therefore, African women do not fit in with the world of tech entrepreneurship. They frequently limit their enterprising drive, especially in tech, out of a fear of social backlash.
“Cultural and religious conservatism in our societies leads to the development of a natural tendency for self-censorship among women”, says Ismaïl Douiri, CEO of Attijariwafa Bank, the leading Maghreb banking group.
Education is another major challenge to the adoption of tech entrepreneurship by women. In Africa, the literacy rate among boys is on average 1.3 times higher than among girls. Moreover, men are more likely to get secondary and post-secondary education than women.
According to Ismaïl Douiri, “in most African countries, education systems have been geared towards getting a degree rather than acquiring the qualifications and skills that support successful integration into the labor market.” Most students lack technical and sectorial skills. Information and communication technologies are virtually absent in the African education system. The high cost of education also makes it a significant barrier.
Women who overcome cultural and education barriers face challenges related to financing. Globally, men represent 92% of partners in the top 100 venture capital firms, and women-founded start-ups receive only 2% of the investments of these firms.
In its latest report, tech start-up investment fund Partech confirmed that across Africa FinTech start-ups raised USD 132.75 million in equity out of the total USD 1.163 billion raised by start-ups in 2018. FinTechs have benefitted from 39.7% of the total financing. However, estimates indicate that women-led start-ups globally receive only 2% of all venture capital funds, a figure that is even lower in the tech world.
Yet, supporting women’s involvement in technology start-ups offers a definite financial benefit. The purchasing power of women continues to rise across the continent. For technology companies, the ability to understand women’s needs and aspirations better creates a definite opportunity to serve them. Who is better positioned than women to design products that meet the consumer needs of women?
Initiatives are being implemented to address these challenges and empower women in the world of tech start-ups, most notably in French-speaking Africa. Banks and mobile network operators have been launching an increasing number of contests, awards, and programs dedicated exclusively to women and technology, such as the Linguère Digital Challenge, which works to advance women in the field of ICT. Similarly, The AFAWA Initiative (Affirmative Finance Action for Women in Africa), designed to improve access to financing for women in Africa, works to close the financing gap that is estimated at USD 42 billion.
Likewise, the eTrade for WomenInitiative launched by the United Nations Conference on Trade and Development (UNCTAD) works to empower women digital entrepreneurs to act as a force for inclusive wealth creation in developing countries.
In Senegal, women represent 30% of the digital ecosystem, compared to 10% in France. Senegal has a range of initiatives in place to support women and an increasing number of incubators and investment funds to help start-ups grow, with the country aiming to reach 35,000 direct jobs in the field of new technologies by 2025.
The ecosystem is buzzing with many initiatives that promote women who embark on the digital entrepreneurship journey and encourage those who hesitate.
Let us not ignore the great success stories of some women-led tech start-ups, such asQuickcash, founded by Patricia Zoundi, a money transfer company that has succeeded in taking into account the needs and realities of African people.
Arielle Kitio, heralded as the “Femme Digitale Africaine de l’année 2019” (African Digital Woman of the Year 2019) launched her start-up Caysti (Cameroon Youth School Tech Incubator), a tech awareness center for children from 6 to 15 years old, in 2017. “Thanks to our intuitive and game-based abcCode software, they learn coding in their native language—French, Hausa, or Wolof.”
In Cameroon, Rebecca Enonchong runs AppsTech, while also being a member of VC4Africa and chairing the board of AfriLabs, which brings together innovation centers and tech hubs from across Africa. Today, the AfriLabs network comprises 151 member hubs in 40 countries, which in turn supports more than 700,000 tech entrepreneurs across Africa.
Even though the numbers are evolving and mentalities continue to change, the start-up ecosystem in Africa still needs to work to enhance women’s representation. Nearly 24% of African women of working age are involved in starting businesses,which is much more than anywhere else. Women represent a strong opportunity, and they need to receive better support. They must be able to carve their role with conviction and self-confidence. To this end, they will also need tools, knowledge, and inspiration.
Are you worried about launching and developing your enterprise with little financial means? Visit the Digital Finance Hub, dedicated to the entrepreneurship ecosystem, that provides tools designed to support entrepreneurs on their journey. Creating a solid talent pool—including among women—is key to increasing the impact of tech start-ups and achieving greater economic, financial, and social inclusion. Ladies, don’t be shy, the tech ecosystem needs you!
This blog is about a startup in the Financial Inclusion Lab accelerator program, which is supported by some of the largest philanthropic organizations across the world – Bill & Melinda Gates Foundation, J.P. Morgan, Michael & Susan Dell Foundation, MetLife Foundation and Omidyar Network.
India has 15 million gig workers or around 40% of the freelance jobs offered globally, and this number has been growing steadily each year. A large proportion of the country’s school dropouts, college students, or partially employed people look out for part-time work to support themselves and their families. This kind of work, popularly known as “gig work”, is often unpredictable, unreliable, and unsustainable. In most cases, gig work arises out of a lack of full-time employment opportunities. Unsurprisingly, we find that the problem of underemployment is more acute in rural areas due to limited economic activities.
Sensing an opportunity to serve the gig economy, serial entrepreneur Lathika Regunathan founded MIMO or Minimum Investment Maximum Outcome. MIMO uses technology to help gig workers across India, especially in rural areas, enhance their earnings. Its mobile application intermediates between the service providers, such as banks and other institutions, and its field officers, typically underemployed youth. The application allows providers to set up a variety of regular and time-bound tasks that they want to outsource. MIMO assigns these tasks to geo-tagged and trained field officers within their chosen locations. The tasks typically include verification of credit card or loan application, collection of cash or documents, and so on. The app features also include analytics, dashboards, and a tracking management mechanism for service providers.
The light-bulb moment
The idea of MIMO came into being when Lathika was working in Latin America in the financial services sector. She observed that the costs of customer acquisition and operations were high in rural areas, which prevented providers from being able to serve customers at the bottom of the pyramid in a feasible manner. Moreover, providers were not able to use a cost-effective platform to serve those customers, especially in locations that were hard to reach. She realized that her home country India must also be in a similar situation, and decided to relocate there soon after to start working on this problem.
The unique pitch
MIMO’s objective is to help the rural and semi-urban workforce take advantage of the digital revolution. Its field officers are generally school or college dropouts in tier 2, 3, and 4 cities. They work with MIMO to earn a livelihood while learning in the digital world.
MIMO also helps financial service and other providers to reach rural markets cost-effectively. Providers find it difficult and expensive to serve customers due to a lack of last-mile infrastructure, distances, and remoteness of many areas. The cost of setting up an extended distribution network, particularly across dispersed rural areas, is high with low returns on investments.
While MIMO allows providers to gain access to the trained workforce and skills closer to the customers that they serve, its field officers get access to opportunities to earn within their localities.
Figure 1: MIMO using technology to connect service providers to its customers.
The impact on LMI segments
Lathika believes that MIMO has a positive impact on the livelihood of field officers. MIMO offers them an opportunity to do respectable work that enhances their social status in the eyes of their communities. They are a part of the digital world and become socially included.
Ram Sahay, one of MIMO’s field officers shared his perspective. “I am proud to work with MIMO because unlike my peers, who must carry loads of documents or application forms to their clients, I work through MIMO’s mobile app to complete the same chores in half the time,” he said with a wide smile. Field officers have said that completing tasks for MIMO has increased their income by 20-30%. They also mentioned how their productivity has improved, as they can plan their days better.
The roadblocks
Since its inception, one of the primary challenges MIMO faced was to gain and retain trust from its clients, primarily banks and other service providers. In the absence of visibility to the last mile, these clients had concerns about the credentials and capabilities of the field officers and lacked trust that the field officers could complete the work as per their requirements.
It was much easier for MIMO to overcome challenges while training field officers in technology and application. These included simple things, such as taking the picture correctly, understanding the meaning of a completed form, and so on. It took more time and repeated training to impart soft skills around communication, presentation, and confidence while dealing with customers.
Diversity in geographical regions has been another area of concern for MIMO. Nuances in work habits required MIMO to approach different states differently. In states, such as Bihar and Uttar Pradesh, MIMO struggled to get field officers to finish the tasks on their list in the allocated time. Field officers in the states in southern India are more disciplined and welcome additional tasks.
The FI Lab support
CIIE.CO and MicroSave Consulting (MSC) conducted boot camps and diagnostic sessions to support MIMO. MSC conducted a strategic business planning session with the top management of the company. This exercise helped them think strategically beyond just survival. Through this exercise, MIMO could set medium- to long-term objectives and smart goals. According to Lathika, this helped streamline their internal processes and brought the team together.
Before the workshop, the MIMO team faced issues that are typical to start-ups. The team lacked well-defined roles and responsibilities. For instance, one team member could end up performing an internal process that the other team member was an expert in, which reduced efficiencies. A lack of communication also contributed to such issues. The workshop allowed the heads of various teams to come together and understand the gaps in communication. They were subsequently able to allocate well-defined roles and responsibilities through mutual consent.
Today, MIMO has reduced the turnaround time of their processes by 25% through better work allocation and by setting up communication standards within the company. The workshop and further handholding also transformed MIMO’s management to be more focused and impactful by prioritizing tasks aligned to the broader vision of the company.
A quick diagnostic field study helped MIMO to understand different challenges that field officers face on the ground and to develop measures to address them. It also provided a fair commission structure based on industry standards.
COVID-19: Turbulent times for MIMO and gig workers
Starting with just a couple of clients and 250 field officers in late 2017, MIMO, until February, 2020 served more than 70 clients through 10,800 field officers. With its operations spanning across 19 states in India, the future for MIMO looked promising. Then the coronavirus struck. The entire country was locked down. MIMO’s field operations were shut down completely and the clients reneged on their commitments to continue their business in these times.
Determined to survive, MIMO toyed with the idea of a video verification process. This is not a big, innovative transformation but a minor tweak to make the best use of the resources available: video calling. What started as an interim solution during the ongoing crisis has quickly picked up steam with both clients and field officers, who have been working from home. The clients’ trust in MIMO’s quality of deliverables and the MIMO team’s ability to adopt the new process and train its willing field officers has started to show results. From almost zero transactions in the latter half of March to a couple of hundred today and a pipeline of two big clients joining in, MIMO could be doing even more transactions than the pre-COVID era.
This blog post is part of a series that covers promising FinTechs that are making a difference to underserved communities. These start-ups receive support from the Financial Inclusion Lab accelerator program. The Lab is a part of CIIE.CO’s Bharat Inclusion Initiative and is co-powered by MSC. #TechForAll, #BuildingForBharat
In Indonesia, large-scale social restrictions, falling consumer demand, and massive layoffs have affected all sectors of the economy. For the 64 million MSMEs operating in the country, this has caused severe disruptions in the supply chain and a drastic reduction in revenues.
Our report highlights the impact of COVID-19 on the MSME sector in Indonesia, particularly on micro-enterprises. We also provide policy recommendations to support the recovery of this sector.
* 0:00 – 2:30 – Graham Wright – Welcome Note, Introductions of the esteemed panelists, and introduction to the agenda – Role of digital financial infrastructure in situations like the COVID and beyond
* 2:30 – 3:30 – Graham Wright – Highlighted India’s achievements on its digital financial infrastructure by stating 3 recent achievements and introduced Topic 1: Role of digital financial infrastructure in situations such as COVID-19 pandemic
* 3:30 – 4:00 – Question 1 for Mr. Rakesh Ranjan NITI Aayog – We understand that payments under the relief package for COVID -19 were made to the beneficiary’s accounts April 1 onwards. Given the scale, how was the cash transfer to over 200 million women managed using Jan Dhan accounts?
* 9:42 – 10:10 – Graham Wright – Introduction to Topic 2:Establishing India’s digital infrastructure
* 12:20 – 12:40 – Question 2 for Mr. Rakesh Ranjan – Most countries want to develop a robust digital financial infrastructure – but (as we know) this is not an easy task. What allowed India to pull this off?
* 17:30 – 18:25 – Question 3 for Mr. Dilip Asbe NPCI – NPCI’s journey has been a hectic and very successful one. What were the key enablers and the key milestones?
* 23:30 – 24:55 – Question 4 for Mr. Rajnish Kumar – SBI is the largest bank implements policies of the government, has integrated with a range of payment systems, and has developed a huge agent network. What did it take at SBI to ensure these happened and what was the most challenging?
* 34:05 – 34:40 – Graham Wright – Introduced topic 3: Practical insights from rolling out the (emergency) cash support transfers, covering both CICO agents and payment infrastructure * 34.44 – 35.20 – Question 5 for Mr. Amitabh Kant – The payments were made to beneficiaries in April and May, and this is in progress right now as we speak for June. What are some of the challenges that the government faced?
* 41:00 – 41:50 – Graham Wright – Significant increase in the agent network and their roles
* 41:51 – 41:42 – Question 6 for Mr. Rajnish Kumar – How has SBI managed these cash transfers? Did you also see a regional variation? How did SBI support its remote branches and its agents during this time?
* 47:10 – 47:30 – Question 7 for Ms. Greta Bull from The World Bank For emergency cash support transfers, which you have seen in other countries as well, what are the lessons/best practices that governments could learn? In particular, how can governments extend these payments into rural areas?
* 55:11 – 56:34 – Graham Wright – Topic 4: What might other countries learn from India?
* 56:35 – 57:10 – Question 8 for Mr. Hari Menon from Bill and Melinda Gates Foundation What according to you are the key points that make the digital infrastructure in India, unique? What can other countries learn for both during the pandemic and more sanguine times?
* 1:04:46 – 1:05:19 – Question 9 for Ms. Greta Bull from The World Bank – How would you compare India’s journey with others? What are the key lessons that other countries can take away?
* 1:09:00 – 1:09:25 – Question 10 for Ms. Greta Bull from The World Bank – India’s journey has been long and it is still underway. While we understand a solution of this scale will take some time to shape up, what might governments do to quicken this pace? Any quick wins that they can take in the journey to digitize G2P transfers?
* 01:12:26 – 1:12:50 – Graham Wright – Introduction to Topic 5: How can countries build digital infrastructure amid the Covid-19 crisis?
* 1:12:55 – 1:13:07 – Question 11 for Mr. Dilip Asbe NPC – How has COVID 19 has challenged the digital infrastructure and what will change after this emergency?
* 1:18:06 – 1:18:33 – Question 12 for Mr. Amitabh Kant – How can India support other developing nations?
* 1:23:36 – 1:24:40– Question 13 for Mr. Hari Menon – What are key elements that can drive the digital financial infrastructure, other than scalability as pointed out? What initiatives are the BMGF supporting to help governments roll out digital financial infrastructure?
* 1:29:30 – 1:29:50 – Question 14 for Mr. Rakesh Ranjan – The digital divide is really important and in the Indian subcontinent, the exclusion of women is often a problem. What is India doing to ensure that women are also included in the digital infrastructure?
* 1:32:50 – 1:38:33 – All the panelists Concluding thoughts and comments
This blog is about a startup under the Financial Inclusion Lab accelerator program, which is supported by some of the largest philanthropic organizations across the world – Bill & Melinda Gates Foundation, J.P. Morgan, Michael & Susan Dell Foundation, MetLife Foundation and Omidyar Network.
Around the world, small and marginal farmers get a meager share of the overall value created in the agriculture supply chain. This is mainly due to three critical inefficiencies, as highlighted in Figure 1. PayAgri is a platform for farmers that works to overcome them and optimize returns for the farmers.
The founders of PayAgri, Rajeev J. Kaimal and Rajkumar KVM started their venture based on a strong need for a holistic solution that could improve the economic condition of farmers. They felt that piecemeal solutions are unlikely to create a desired and sustainable impact.
Figure 2: Rajeev J Kaimal and Rajkumar KVM, the founders of PayAgri
Rajkumar is an investment banker who comes from an agricultural family in Theni, Tamil Nadu. Rajeev G. Kaimal worked in the rural banking and financial services space for over 18 years. In 2014, Rajeev became the founding member ofSamunnati, a finance company that worked in the dairy value chain. Rajkumar joined later as a consultant to help build products and set up the company’s trading division. They saw the plight of small farmers in India as a problem that needed a solution—one they sought in the agricultural space.
Their shared interest and common passion in agriculture prompted them to conceptualize PayAgri in February, 2017. Its objective is to use technology to create an inclusive economy that takes care of the aspirations of every player in the agriculture value chain without compromising on the interest of farmers.
Connecting farmers to lucrative markets
At present, small and marginal farmers take the smallest share of the consumer’s rupee in the entire value chain—under 30%. A large part of that goes to various intermediaries and is absorbed in market (mandi) fees and commissions of the Agricultural Produce Market Committee (APMC) markets (Figure 3). While intermediaries perform a critical role in the value chain, some optimization is necessary to help small and marginal farmers get a larger share of the overall pie.
Typically, the farmers get fair prices for their grade A produce easily through retail vegetable vendors. Yet they struggle to find a market for grade B and grade C produce. Other factors like delay in payments by traders, non-transparent pricing, and limited technology go against the interest of small and marginal farmers.
Figure 3: Local supply chain
Rajeev and Rajkumar realized that they could support farmers in terms of both market and financial linkages. Of the two, market linkage has been their current focus as it is easier to achieve and provides immediate relief to farmers. The FI lab supported PayAgri and its registered farmers to help farmers get a better price for their produce. This support also strengthened PayAgri’s forward linkages by:
Scoping out the existing purchase practices of vegetable vendors and small hotel owners in and around Chennai;
Expanding markets for the farmers and providing a better pricing structure for their grade B and grade C produce;
Identifying market avenues for their produce in smaller hotels, roadside eating-outlets, and restaurants and by developing a suitable pricing strategy.
Further, PayAgri constructed a warehouse near the consumption hub to store farmers’ produce. Through these strategic steps, they were able to eliminate a few intermediaries and ensure better price realization for the farmers.
In the next round of technical assistance, the FI lab helped PayAgri conduct a baseline assessment to identify potential intervention areas and ascertain the priority to digitalize the Agri value chain in the Nilgiris district of Tamil Nadu. The findings of this study helped PayAgri assess the efficacy of its intervention to help the community to get higher returns on investment from the value chain of root vegetables. The program also initiated a pilot diagnostic study that supported PayAgri to build an impactful medium-term strategy on digitalization.
The impact on small and marginal farmers
Based on the digitalization strategy, most of the interventions from PayAgri fall under different types of linkages, such as:
Input linkage (directly with input manufacturers)
Financial linkage (access to finance through banks or NBFCs)
Market linkage (directly with institutional buyers)
Risk mitigation through insurance and
Technical support
The immediate requirement for small and marginal farmers is to facilitate market linkages and to help them to grade, sort, and package their produce. With its agri-hub model running in a few cities, PayAgri has been able to support the farmers in all these areas, resulting in better prices to farmers for their produce.
With farm-gate procurement followed by grading and sorting, PayAgri offers 10-30% more to farmers, depending on the crop—zucchini, capsicum, carrot, coconut, grains, and fruit, among others. This has been a result of the elimination of intermediaries from the value chain and partnerships with last-mile corporates and other retailers (Figure 4). Until 2019, PayAgri had an impact on over 2,000 farmers in terms of better incomes, through its platform with transaction values totaling over INR 60 million (USD 790K).
Figure 4: Tech-enabled supply chain
Besides driving market linkages, PayAgri has influenced farmers to improve the soil quality by sourcing organic inputs, which will help the farmers in the long run. PayAgri’s plan to provide holistic support and digitalize the entire Agri value chain for such small and marginal farmers will not only bring about reforms and efficiencies into the value chain but also help these small farmers build digital footprints. These digital records will make them creditworthy for the formal lending or banking institutions to lend against.
Roadblocks
“Working at the ground level is not an easy task”, says Rajeev, while speaking of the many hurdles that they encountered in the process. Although the current impact is a good start, PayAgri seeks to scale its operations and make the impact sustainable. Some of the major challenges that PayAgri faced or still faces are:
Convincing the farmers and Farmer Producer Companies (FPC) to work together;
Extensive reliance on cash transaction through the entire value chain, with no recordkeeping;
Lack of digitized records of farmers that otherwise would have helped them get better access to financial services;
Gaining the farmers’ trust to share data remains just as elusive as getting them working capital from formal institutions at reasonable rates of interest.
COVID-19, the unlikely catalyst to PayAgri’s success
Due to the current pandemic situation, PayAgri has delayed implementing its long term strategy. However, in general, the pandemic has been a blessing in disguise for the start-up and for the farmers and clients it serves.
PayAgri has been able to find a product-market fit for itself. Since the lockdowns started, the government has permitted the delivery of essential goods and services alone. PayAgri has been quick to respond to this situation, as highlighted in Figure 5, by aligning its logistics and distribution infrastructures to procure essential goods, such as food items. It has obtained licenses to transport and deliver the goods to its customers through its warehouses in Chennai and Theni, Tamil Nadu.
PayAgri has validated its business model by earning sustainable margins and becoming a strong enabler in the agri-supply chain . PayAgri’s customers are mostly retail or institutional buyers of farmer produce. They have shortened their pay cycles to PayAgri from a week to a day as they value PayAgri’s timely and quality assured deliveries of goods. This has led to improved cash flows for the start-up, which has, in turn, utilized these gains to maintain prompt payment to farmers and mitigated the risk to the farmers’ financials. Overall, PayAgri’s business model translates to gains for both the supply and demand sides.
Figure 5: PayAgri successfully delivered 12 trucks of rice and pulses to six cities in seven days, serving the farmers and the community
PayAgri has been experimenting with the farm-to-home model and has been piloting deliveries of its warehouse inventory directly to homes while cutting out the intermediaries.
PayAgri has also been trying to scale up. It has started to pilot a franchisee model in Coimbatore, Tamil Nadu. In this model, while PayAgri links the relevant FPOs to the Coimbatore franchisee, the franchisee is responsible for taking care of logistics to procure from FPOs and sell to PayAgri’s customers. The franchisee pays a fixed fee to PayAgri per year. Through this franchise model, PayAgri will offload the CAPEX costs to its franchisees and become profitable and scalable in a short span of time.
This blog post is part of a series that covers promising FinTechs that are making a difference to underserved communities. These start-ups receive support from the Financial Inclusion Lab accelerator program. The Lab is a part of CIIE.CO’s Bharat Inclusion Initiative and is co-powered by MSC. #TechForAll, #BuildingForBharat
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Lathika believes that MIMO has a positive impact on the livelihood of field officers. MIMO offers them an opportunity to do respectable work that enhances their social status in the eyes of their communities. They are a part of the digital world and become socially included.
