Digitization in Svatantra Microfin has enabled true financial inclusion i.e., savings, credit, insurance, investment in respect of over 4 mn women borrowers in deep rural India:
Svatantra Microfin has emerged as one of the most differentiated process and technology driven microfinance entities. It is one of India’s fastest growing MFIs, serving rural women customers. It provides complete and affordable financial and non-financial solutions to rural women, who are entrepreneurs themselves.
Svatantra Microfin’s tech-effort is reflected in its day to day working. The business team for a long time would carry prints of the loan applications and take wet signatures of customers on these forms. In the past, where Svatantra reached 10,000 rural women customers per month, now it reaches at least 100,000 per month. The process, which used to take 12 days, has reduced to one day, impacting the rate of financial inclusion, which has gone up 10X.
Ananya Birla, Chairperson, describes: “In the challenging environment, we have successfully integrated digital penetration of about 32% of our customer base, who transact using our customer facing App ‘Saksham’. Today Svatantra is 100% paperless with the help of loan origination system, ‘Saathi App’ and e-signature. Moving to the app and e-sign has proven a big leap towards complete paperless operations.”
Even before government’s Digital India flagship campaign was introduced, Svatantra Microfin was determined to create an ecosystem which enabled the unbanked rural customers become part of the formal banking space. It enables customer to access their accounts, credit and payment mechanisms along with obtaining other investment products. From inception since 2012, Svatantra has helped financially include more than 4 million women in deep rural India.
Digitization includes use of mobile app, cashless collection through tech/digital media, etc. Ananya elaborates: “Digitization in Svatantra has enabled true financial inclusion i.e., savings, credit, insurance and investment. At Svatantra, creating differentiation through innovation and tech-led initiatives have been pivotal. This included helping the rural women customers open their bank accounts and disburse the loan amount directly to their account. We have enabled them to join financial mainstream e.g. payments (UPI, BHIM, BBPS), access to credit, etc.”
Svatantra Microfin has pioneered and maintained cashless disbursement to all its rural customers. This has led to save customer’s time, who are depended on daily earnings for sustaining their livelihood. During the covid pandemic Svatantra Microfin introduced a 24×7 tele-med services, availing OPD consultation for rural clients from the comfort of their home. It created a seamless work environment supporting work from home of many employees through infrastructure support at home. The last 2 years have been nothing but extraordinary, with the uncertain outburst of pandemic and related lockdowns. As the entire country grappled with the second wave of covid, the company’s top priority remained employee and client safety. A health monitoring mechanism was set up with real-time information and a dedicated task force for proactive action in emergency management. Special monetary coverage for employees was given to financially support them during emergencies. As a result of these measures, the company has not experienced significant business disruptions.
Ananya points out: “In the times where contactability was an issue, company’s unique cashless payment system came to the rescue. We encouraged customers about digital transaction, thereby avoiding in-person meeting. In the microfinance more than 30% of collections were made cashless and remaining through cash management alliances. We have been encouraging cashless disbursement, and enabling financial inclusion. We aim to emerge as an impactful tech-differentiated NBFC-MFI.”