Svatantra Microfinance

Svatantra Microfinance () 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. Svatantra, which means independent in Hindi, received a licence for the microfinance business (made popular by Nobel laureate Muhammad Yunus), from the Reserve Bank of India in February, 2013. Svatantra aims to empower women in the under-served rural areas of Maharashtra and Madhya Pradesh. The organisation provides complete and affordable financial and non-financial solutions to rural women who are entrepreneurs themselves.

History

Initially funded by the Aditya Birla Group, Svatantra offers the lowest interest rate in the country and now operates 18 branches in seven districts in two Indian states. 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 44,919 ACTIVE clients and a total client portfolio of Rs 46.91 crore.

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.

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.