Industry Financial services Founded 11 February 2012 | Products Microfinance Founder Ananya Birla | |
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Type Microfinance Organisation Area served Maharashtra, Madhya Pradesh Areas served Maharashtra, Madhya Pradesh | ||
Svatantra microfinance
Svatantra Microfinance (Sanskrit: स्वतंत्र) is an Indian microfinance organisation founded by Ananya Birla, the daughter of Indian industrialist Kumar Mangalam Birla. Launched on February 17, 2012 (with operations officially commencing on March 1, 2013), it is India's youngest microfinance firm, and is among the top three microfinance companies in India. Svatantra, which means independent in Sanskrit, received a licence for the microfinance business (made popular by Nobel laureate Muhammad Yunus), from the Reserve Bank of India in February, 2013. The organisation provides complete and affordable financial and non-financial solutions to rural women who are entrepreneurs themselves.
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Svatantra microfinance poetry
History
Initially funded by the Aditya Birla Group, Svatantra offers the lowest interest rate in the country and now operates 40 branches in 21 districts of Maharashtra and Madhya Pradesh. It offers credit of as much as Rs.10,000 to women in villages in Maharashtra to buy sewing machines and start businesses to make papadums. Currently, the organisation has 1,20,249 active clients across three states (Maharashtra, Madhya Pradesh and Uttar Pradesh) and a total client portfolio of 128 crores. The core management team of Svatantra has wide experience in the microfinance business. Their prudent lending policies with cashless disbursements and good systems for loan monitoring and collections has ensured good asset quality profile.
Application of Microcredit
Svatantra's microcredit policy is based on a group lending model where members take unsecured loans to fund a business or other income generating activity and stand guarantee for one another in their group ensuring credit discipline and prompt repayments through peer pressure.
It offers livelihood-related loans at 22% interest rate, as compared with standard microfinance companies whose interest rates range between 25-26 %. The organisation has a 100% cashless disbursement through National Electronic Funds Transfer (NEFT); and also helps its clients open bank accounts, adhering to one of its core missions of financial inclusion. Svatantra follows the practice of cashless disbursals to borrowers through their bank accounts. Agents and field officers do not carry money with them. Joint lending groups in villages ensure everybody stands guarantee for the other. The company uses an integrated software, developed by Infrasofttech, for its loan management and accounting requirements, with branches being fully computerised. In addition, the field staff uses an Android app for updating the collection data on-field itself, on a real-time basis.
Honours
Within just a year since its inception, Svatantra Microfinance had 10,000 customers, 51 employees, 9 running branches in two states and zero repayment default. This won the organisation a Gold Award in the start-up category at the Skoch Financial Inclusion and Deepening Award in 2014. Beginning 2016, the ICRA assigned the long-term rating of ICRA A- with stable outlook for the Rs. 100.00 crore bank facilities and an MFI grade of M3+ for Svatantra's ability to manage its microfinance activities in a sustainable manner.