Accion in India 2013
Our Vision To build a financially inclusive world with access to economic opportunity for all. Our Mission To give people the financial tools they need to improve their lives. Front cover: Husnara Khatum, client of Accion partner Saija Finance in Patna, Bihar
A Letter from Our Regional Head Dear Friends, Nowhere is the full breadth of our work better exemplified than in India. Since Accion launched operations in the country in 2005 by establishing Accion Technical Advisors India a charitable institution under Section 25 of the Companies Act of 1956 we have expanded our reach and efforts to meet the financial needs of hundreds of thousands of people living in poverty. In a country where the needs are as great as the opportunities, we have made a significant impact by strengthening microfinance institutions with management, investments and governance; supporting social enterprises that serve people living at the base of the economic pyramid; training industry professionals; teaching clients financial literacy and business skills; working tirelessly to implement strong consumer-protection measures through the Smart Campaign and expanding inclusion through our Persons with Disabilities initiatives. The following pages provide a snapshot of our efforts and successes on all of these fronts. Despite our achievements, much more work remains. I thank you for your support and hope you will continue to join us in building a financially inclusive world with access to economic opportunity for all. Sincerely, Victoria White Regional Head, Asia Accion
Our Approach Accion s mission in India, and globally, is to give people the financial tools they need to improve their lives. Our approach is based on three strategic pillars: Building the next generation of microfinance institutions (MFIs) by helping MFIs achieve greater scale, sustainability and efficiency; Pushing the frontiers of financial inclusion beyond MFIs by providing impact-investment funding for new technologies and promising start-ups that serve the base of the economic pyramid; Building a stronger industry with higher standards by redoubling industry commitment to consumer protection, transparency and social-performance measurement.
Our Initiatives in India Building Strong Microfinance Institutions We are supporting partners Saija Finance Private Limited and Swadhaar FinServe Private Limited with management and technical services, investments and strategic direction. Impact Investing Accion s Frontier Investments Group and Accion s Venture Lab have made investments in promising young Indian start-up companies that serve low-income families with financial products and services, from affordable mortgages to education loans, health insurance and more. Client Education Since 2008, we have been working in India on this key non-financial component of economic development through two major focus areas: financial literacy for low-income families through our Money Plan program, and business skills for microentrepreneurs through our award-winning Dialogue on Business program. Industry Training and Capacity Building We provide technical and management training to microfinance industry professionals through our Regional Training Center. Client Protection and Inclusive Finance The Smart Campaign for client protection, managed by the Center for Financial Inclusion at Accion, is working with microfinance leaders in India to provide the industry with the tools and resources they need to deliver transparent, respectful and prudent financial services to all clients. Among the campaign s principles is meeting the needs of persons with disabilities.
Our Work at a Glance Since Accion launched operations in India in 2005, we have expanded our reach to meet the financial needs of hundreds of thousands of people. 2013 Key Statistics Microfinance Institutions Impact Investing INDIA HIGHLIGHTS 144 THOUSAND 10.6 MILLION entreprenuers reached through our microfinance partners Saija Finance and Swadhaar FinServe as of September 30, 2013 dollars invested in Indian MFIs and other companies serving the poor through financial services, affordable housing, education and more Client Education Industry Training Client Protection 73 THOUSAND 10.8 THOUSAND 2 MILLION people taught financial literacy and business skills, to date, by Accion and its partners microfinance professionals trained since 2008, through our Regional Training Center clients served by the three MFIs certified, to date, by the Smart Campaign for client protection
Sudha Sawant and her daughter, jewelery maker and client of Accion partner Swadhaar FinServe in Mumbai, Maharashtra.
Baby Devi, snack stand owner and client of Saija Finance in Patna, Bihar.
Building Strong Microfinance Institutions Key Statistics 144 thousand entrepreneurs reached through our microfinance partners Saija Finance and Swadhaar FinServe as of September 30, 2013 In line with our first strategic pillar building the next generation of top-tier microfinance institutions we partner with Swadhaar FinServe, headquartered in Mumbai, and Saija Finance, based in Patna, Bihar. We provide management services, investment and governance to both institutions, which, as of September 30th, 2013, were collectively delivering microfinance services to more than 144,000 microentrepreneurs in Maharashtra, Gujarat and Bihar. Learn more about our microfinance partners in India on our website: www.accion.org/india SWADHAAR FINSERVE PRIVATE LIMITED Swadhaar was established in 2006 with the initial goal of developing financial products for the low-income urban families of Mumbai. Between 2006 and 2008 Swadhaar, in cooperation with Accion, adapted and tested a number of products to meet the needs of two distinct urban market segments: low-income working women and microentrepreneurs. Based on its successful experience in Mumbai, in which Swadhaar demonstrated that urban lending can work in the Indian market, Swadhaar expanded its reach to cities in Gujarat and Maharashtra. With the support of Accion, Swadhaar has 1) developed, piloted and implemented new, clientfocused products; 2) redesigned systems and processes for more efficient operations; 3) strengthened organizational capacity and management; and 4) adopted responsible finance practices that keep clients at the center of all business decisions. As of September 30th, 2013, Swadhaar was serving 112,667 active clients with an active portfolio of INR 1,449,401,923. SAIJA FINANCE PRIVATE LIMITED Saija was founded by two professionals with careers in banking and human resources in Bihar, a state that remains one of the poorest in India. With Accion s support, Saija is strengthening its credit methodology, delivering client-centered microfinance products and services and developing alternative delivery channels to improve efficiency. Saija seeks to prove to other social entrepreneurs that profitable and national-scale businesses can be run out of Bihar. Accion is providing management services and technical assistance to Saija to support the scale-up of microfinance operations.two Accion seconded staff members and various shortterm specialists are assisting in the development of procedures, mechanisms and strategies so that Saija can improve its operations and attract additional investors and capital. As of September 30th, 2013, Saija was serving 31,967 active clients with an active portfolio of INR 301,838,073.
Impact Investing Key Statistics 10.6 million dollars invested in Indian MFIs and other companies serving the poor through financial services, affordable housing, education and more We support economic development in India through our second strategic pillar: pushing the frontiers of financial inclusion beyond microfinance institutions. We are executing that strategy through two impact-investing initiatives: Accion s Venture Lab, which provides seed funding and technical assistance to promising startups committed to broader financial inclusion but which are often labeled pre-investable ; and Accion s Frontier Investments Group, a hands-on equity partner investing in early-stage, post-revenue companies that have moved beyond the seed stage. Learn more about our impact investing in India: www.accion.org/india ACCION S VENTURE LAB To date, Venture Lab has made investments in two start-up Indian companies, Varthana and MeraDoctor. Varthana provides specialized loans and other support to affordable private schools, promoting access to and quality of education for India s poor and emerging middle class. MeraDoctor provides a comprehensive health protection product to low-income Indians, combining 24/7 doctor-on-call helpline services with health insurance products to protect its customers from poverty-inducing health shocks. Find out more online: www.accion.org/venturelab. ACCION S FRONTIER INVESTMENTS GROUP Frontier Investments Group has made early-stage investments in, and provides governance to, two promising young Indian companies, Vindhya and Shubham. Vindhya e-infomedia Private Limited, located in Bangalore, is the only company of its kind to provide business process outsourcing services to global and local markets by recruiting differently abled employees. Vindhya is a for-profit company that provides clients with data entry and data management, processing and conversion services. Shubham Housing Development Finance Company is an affordable housing lender headquartered in New Delhi that serves low-income, self-employed families in urban and semi-urban areas. Access to credit, delivered in a systematic and professional manner, is a key enabler in increasing people s ability to purchase or improve the quality of their homes, and Shubham has developed an innovative credit model for customers with informal incomes by leveraging new technologies and practices to obtain impressive operating efficiency. The company currently operates 25 branches in seven states. Find out more online: www.accion.org/frontier.
Accion partner Mann Deshi Foundation s clients attend a Dialogue on Business class in a mobile classroom in Mhaswad, Maharashtra. Client Education Key Statistics 73 thousand people taught financial literacy and business skills, to date, by Accion and its partners Learn more about our client education work in India: www.accion.org/clienteducation/india We believe client education is integral to the long-term success and sustainability of the microfinance industry. Since 2008, we have been working in India on this key non-financial component of economic development through two major focus areas: financial literacy for low-income families through our Money Plan program, and business skills for microentrepreneurs through our award-winning Dialogue on Business program. FINANCIAL LITERACY Our financial literacy program, Money Plan, is a workshop-based training initiative. It focuses on seven topics: financial planning, cash flow management and budgeting, savings, debt, insurance, investing and banking, and business correspondence. The program is available in audiovisual and print formats, catering to both literate and non-literate audiences, and it offers an alternative where audiovisual technology is unavailable. The program is available in English, Hindi, Kannada, Tamil and Marathi. DIALOGUE ON BUSINESS Dialogue on Business is a business-training model that uses interactive games and roleplaying to help microentrepreneurs solve real-life business challenges. Dialogue was developed specifically for adult learners and based on the knowledge and experience of participants. Because the workshops are based on the real situations of its participants, rather than textbook cases, they are especially engaging for people with little formal education who may not learn effectively in a traditional classroom setting. Among the 54 training modules available in our curriculum are courses on business feasibility, entrepreneurial management, leadership, communication and promotion, cash management, savings, investing and debt. Languages: English, Hindi, Tamil, Marathi, Malayalam, Kannada. To date, Accion in India and its partners have taught financial literacy and business skills to more than 73,000 entrepreneurs, with the goal of training 100,000 by the end of 2014.
Microfinance professionals attend a session by Accion s Training and Capacity Building unit in Bangalore. Industry Training Key Statistics 10.8 thousand microfinance professionals trained in India since 2008, through our Regional Training Center Learn more about our industry training initiatives in India: www.accion.org/ training A key part of our commitment to strengthening the microfinance industry and expanding financial inclusion is training microfinance professionals around the globe. We help them prepare to become managers and leaders in the industry through specialized training programs, workshops and exposure visits. TRAINING AND CAPACITY-BUILDING We provide high-quality training programs and cross-regional learning experiences that connect participants in the classroom and virtually, building core skills and promoting knowledge sharing. Regional training centers in China, Ghana and India allow us to customize our programs and tools for local institutions and professionals looking to expand their services and outreach. Our courses leverage more than 50 years of rich industry knowledge and expertise within our organization and across our network of partners, and they are constantly evolving to incorporate best practices, trends and innovations. Recognizing that not all learning happens in the training room, we offer structured, peerto-peer learning activities exclusively to technical staff and managers of our microfinance partner institutions. These capacity-building activities include exposure visits to model institutions, workshops on industry topics and webinars led by subject matter experts. Our Training and Capacity-Building team works closely with our Indian partner MFIs to build the technical, managerial and leadership capacity of their staff across all levels of the organizations. We offer courses that address the training needs of field, mid- and senior-level staff. Since 2008, we have trained 10,800 microfinance professionals in India.
Client Protection and Inclusive Finance Key Statistics 2 million clients served by the three MFIs certified, to date, by the Smart Campaign for client protection We support pioneering industry initiatives that keep clients first in the microfinance industry and secure equal and fair access to quality financial products and services for persons with disabilities. THE SMART CAMPAIGN In line with Accion s strategic goal of building a stronger industry with high standards, in 2009 the Center for Financial Inclusion at Accion, whose founding sponsor is Credit Suisse, launched the Smart Campaign the industry s first-ever consumer-protection campaign. The campaign s goal is to ensure that the microfinance industry remains both financially sound and socially focused. Learn more about the Smart Campaign online: www. smartcampaign.org The Smart Campaign is working with microfinance leaders in India to provide the industry with the tools and resources it needs to deliver transparent, respectful and prudent financial services to all clients. The campaign includes the assessment and certification of microfinance institutions that comply with its consumer-protection principles. With support from the International Finance Corporation, the campaign has conducted 10 client-protection training sessions, covering 98 microfinance institutions. It has also conducted 18 in-depth assessments of large MFIs, which collectively represent 14.4 million clients. Those assessments have enabled the campaign to establish the first benchmarks on Client Protection Principles in the country. The campaign has also partnered with Micro-Credit Ratings International Ltd, the largest ratings agency in India, to launch its certification. PERSONS WITH DISABILITIES Learn more about our work on financial inclusion for persons with disabilities on the Center for Financial Inclusion s website: www. centerforfinancialinclusion. org/programs-a-projects/pwd Disability inclusion represents an opportunity to do well by doing good an achievable win-win for nations, their citizens and inclusive financial service providers. This is particularly true in India, which is the largest and most dynamic microfinance market in the world and home to at least 15 million financially excluded persons with disabilities. Microfinance institutions in India have an extensive reach and have achieved admirable levels of operational efficiency. Yet, there is much work to do for people with disabilities.accion has developed a roadmap to disability inclusion and is piloting these activities with several MFIs in India. In the longer term, the project aims to catalyze cultural and operational transformation within the MFIs so that they become more inclusive at all levels.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION ACCION TECHNICAL ADVISORS INDIA ON MARCH 31 2013 2012 ASSETS CURRENT ASSETS Inventories INR 378,784 INR 229,184 Trade receivables 7,251,720 2,240,930 Cash and cash equivalents 2,755,397 796,278 Short-term loans and advances 646,775 650,739 Other current assets 146,250 - TOTAL CURRENT ASSETS 11,178,926 3,917,131 NON-CURRENT ASSETS Fixed assets Tangible assets 403,499 524,566 Intangible assets 13,498 94,452 Long-term loans and advances 6,639,328 6,316,754 TOTAL NON-CURRENT ASSETS 7,056,325 6,935,772 TOTAL ASSETS INR 18,235,251 INR 10,852,903 EQUITY AND LIABILITIES SHAREHOLDER S FUND Share capital INR 570,500,000 INR 570,500,000 Accumulated deficit in the income and expenditure account 48,828,734 61,501,873 CURRENT LIABILITIES Short-term borrowings INR 2,787 INR 7,540,835 Trade payables 1,422,721 1,806,066 Other current liabilities 3,828,120 2,807,948 Short-term provisions 1,940,866 1,534,104 TOTAL CURRENT LIABILITIES 7,194,494 13,688,953 NON-CURRENT LIABILITIES Long-term provisions 2,369,491 1,165,823 TOTAL LIABILITIES INR 18,235,251 INR 10,852,903
CONSOLIDATED STATEMENTS OF ACTIVITIES ACCION TECHNICAL ADVISORS INDIA YEAR ENDED MARCH 31 2013 2012 INCOME Donations and grants INR 66,112,338 INR 42,213,321 Revenue from operations 12,774,393 12,360,982 Other income - 27,810 TOTAL INCOME 78,886,731 54,602,113 EXPENSES Cost of training materials sold 16,800 547,848 Employee benefits expense 42,309,760 34,716,368 Finance costs 663,975 1,151,555 Depreciation and amortization expense 390,938 345,788 Other expenses 24,321,923 18,388,982 TOTAL EXPENSES 67,703,396 55,150,541 EXCESS OF INCOME / (EXPENDITURE) BEFORE PRIOR PERIOD ITEMS 11,183,335 (548,428) PRIOR PERIOD INCOME 1,489,804 - EXCESS OF INCOME / (EXPENDITURE) FOR THE YEAR INR 12,673,139 INR (548,428) Prepared by Anupam Kumar, Partner, Walker, Chandiok & Co Chartered Accountants for and on behalf of the Board of Directors: Ashok Kumar Nedurumalli and Sarayu Kamat.
Bainabai Sagar, client of Mann Deshi Foundation and participant in Accion s Dialogue on Business training program, operates a tea stand in Mhaswad, Maharashtra.
The family of a Mann Deshi Foundation client and Dialogue on Business participant gathers for a group photo after a training session in Mhaswad, Maharashtra. Our Supporters Our work in India is made possible in part thanks to the support of the following organizations: CITI FOUNDATION CREDIT SUISSE THE DEPARTMENT FOR INTERNATIONAL DEVELOPMENT (DFID) FIRST DATA INTERNATIONAL FINANCE CORPORATION RUMSFELD FOUNDATION SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA Our Board of Directors in India We thank the members of our Board of Directors for their commitment to our work in India: MR. ASHOK KUMAR NEDURUMALLI MS. SARAYU KAMAT
About Accion in India Accion is legally represented in India by Accion Technical Advisors India (Accion India), an Indian charitable institution, organized under Section 25 of the Companies Act, 1956. Accion India was formed for the purpose of providing counsel and advice to governments, government bodies, microcredit and microfinance institutions, banks and other financial institutions that provide assistance to the poor. Accion India also undertakes, encourages, reviews and invests in research and development activities in order to acquire, create, and/or develop new technologies and products designed to serve the financially excluded.
Investing in individuals. Improving our world. Accion in India BANGALORE, INDIA No. 9/3, Kaiser-E-Hind, 1st Floor Richmond Road Bangalore 560 025, India Tel. +91 80.41120008 Fax +91 80.41120009 Other Offices BOSTON, MA, USA 56 Roland Street Suite 300 Boston, MA 02129 USA Tel. +1 617.625.7080 Fax +1 617.625.7020 WASHINGTON, D.C., USA 1101 15th St., NW Suite 400 Washington, D.C. 20005 USA Tel. +1 202.393.5113 Fax +1 202.393.5115 BOGOTA, COLOMBIA Carrera 45 A Numero 128 B 41 Local 14 Centro Comercial Rosetta Bogota, Colombia Tel. +571 748.0707 Fax +571 520.3373 ACCRA, GHANA No. 46 5th Norla Link North Labone, PMB KD. 61 Accra, Ghana Tel. +233 302.769.860 +233 302.769.587 Fax +233 302.782.170 BEIJING, CHINA Room 606, Building 3 Wan Da Plaza No. 93 Jianguo Road Chaoyang District, Beijing China Tel. +86 1 058208757 Fax +86 1 058208830 12_13