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Save the Farmer

Govt. of Karnataka Page 1

“SAVE THE FARMER”

PROPOSAL FOR

A MODEL CSR PROJECT

IN TUMKUR DISTRICT

Save the Farmer


Contents

1. Executive Summary ......................................................................................................................................3

2. Introduction ............................................................................................................................................... 11

Vattikuti Foundation .......................................................................................................................................... 11

Community Based Organization & Federation .................................................................................................. 11

3. Approach ................................................................................................................................................... 14

4. Stakeholders .............................................................................................................................................. 16

5. Mobile Digital Technology Platform .......................................................................................................... 18

AltiFin – Key Functional Modules ...................................................................................................................... 18

AltiFin – CBO ...................................................................................................................................................... 19

6. Roles and Responsibilities ......................................................................................................................... 21

7. Programme Financials……………………………………………………………………………………………………………………………24

8. Summary……………………………………………………………………………………………………………………………………………….24

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1. Executive Summary

The Government of Karnataka is seized with the immediate plight of the stressed farmers with a spate of suicides in the state. With an urgent need to address the issue in a holistic and comprehensive manner, the Govt. has invited support from the corporates and social organizations in finding both an immediate as well as a long term solution.

It is with this view that the Govt. has joined hands with Vattikuti Foundation (VF), its technology partner – Davinta, NGO and BC partner, to offer an integrated programme of Financial Freedom and Livelihood through tying up with local Community Based Organizations (CBO) in Tumkur District. The programme is for three years and is extendable to further term.

Objectives:

This Programme along with the relevant stakeholders will

o Immediately ameliorate the current stressed condition of the farmers in Tumkur District

o Make Agriculture Profitable for the farmers by providing them skills inputs and market

linkages

o Prevent Farmers suicides in Tumkur District

o Wean away the farmers from the scourge of unscrupulous money lenders by offering them

resources from the mainstream financial institutions

o Provide the community with self-sustainability by equipping it with skills and financial literacy

o Introduce main stream financial sources for building a sustainable eco system

o Use Mobile Digital technology for delivery of the programme

Achievements of CBO Model Implemented at Kunigal Taluk:

The Programme will draw from the wide experience of a similar program conducted by Vattikuti Foundation in Kunigal Taluk of Tumkur District, where with SBI’s support and help of a leading NGO, IDF, an aggressive livelihood initiative resulted in a largely successful, self-sustaining local CBO model.

Achievements of the programme:

1) Households dependent on Money Lenders were reduced from 45% to 8% during the programme. 2) Bank credit access to the group members have gone up by 100%. 3) 82% of total members acquired livelihood assets. 4) 90% of the group members got incremental income. 5) 10% of poor households moved out of poverty.

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The Summary of the Kunigal Taluk Programme:

Table A: Demographics details 1

# Particulars Apr 2009 Mar 2013

1 Population 205,687 210,279

2 Households 45,380 46,364

3 No. of poor households including poorest of the poor 41,750 23,534

4 No. of poorest of the poor households 3,078 2,168

Table B: Coverage of poor 1

# Particulars Target Achievement

1 No. of Households covered in the programme 28,369 22,000

2 No. of poor households covered in the programme 25,050 20,240

3 No. of poorest of the poor households 3,078 3,078

Table C: Movement out of poverty1

# Particulars Before After % of HH covered

1 Poor Households moving out of poverty 20,240 18,216 90

2 Poorest of poor moving out of poverty 3,078 910 30

Table D: Financial impact1

1 % of Group members getting incremental income 90%

2 Average incremental annual Income per household Rs . 49,874

3 Average incremental annual Income per household USD @ 60 INR 831

Table E: Financial inclusion1

# Particulars Pre project Before Apr

2009

Post project Mar 2013

1 Households able access to credit from Bank, Cooperatives 2,200 (10%) 22,000 (100%)

2 Households dependent on Money lenders for credit 9,900 (45%) 1,760 (8%)

3 No. of Groups credit linked 0 2,060

4 No. of group members credit linked 0 28,838

5 Total bank credit accessed Rs in Millions. 0 997.20

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# Particulars Pre project Before Apr

2009

Post project Mar 2013

6 Average credit per group member Rs. 0 34,579

7 Average credit per Household Rs. 0 45,327

Table F: Livelihood assets acquisition1

# Particulars No. of members (% to total Members)

1 Members acquiring livelihood assets 23,647 (82%)

2 Of which Live stocks (milk cattle, sheep/goat) 20,187 (70 %)

1 - ISEC Report

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Implementation:

Core Committee:

It is proposed to form a Core committee under the District Minister. The Core committee will consist of:

This is a Govt. led initiative led by the District Minister, Principal Secretary, DC of the District and CEO of Zila Parishads, Vattikuti Foundation along with a technology partner, NGO, MicroGraam and supported by a mainstream bank.

Programme Funding:

A corpus fund through CSR contributions will be created to address the following:

Immediate help and financial support to stressed farmers to prevent farmers suicide

Utilise funds to create a long term sustainable ecosystem for social and economic upliftment of farmers and rural people.

Mainstream Financial Institution Support:

One of the main objectives of the programme is to wean the farmers away from unscrupulous money lender who have kept them in perpetual debt trap.

It is proposed to bring in mainstream banks to offer credit at reasonable rates and on comfortable terms.

Livelihood:

The Programme will endeavour to make farming profitable by sustainable livelihood and intent a socio economic programme.

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Technology:

One of the key learning from a programme in Kunigal Taluk was the need of comprehensive technology platform. Such a technology platform was devised and proven in Kunigal Taluk.

The Platform offers a mobile based solution which not only allows total digital monitoring of the community affairs but also extends mainstream banking solutions to the doorstep of the farmers.

It is proposed to use the same technology platform in our proposed area.

Operational Plan:

The programme will cover all Ten Taluks of the Tumkur District. The details of Ten Taluks are as follows:

It is proposed to extend kunigal model of operation to achieve the above objectives. The kunigal model was based on grouping SHGs/JLGs and federating them at the Taluk level. It also provided for livelihood activities and exposure to mainstream financial institutions.

1) Grouping, counselling, training, and CBO formation:

The CBO model envisioned sustainable poverty alleviation through community ownership of the processes, through CBO. Building on this model, the programme envisages:

The Programme will organize farmers and women into groups, provide them counselling, build their

skills, and expose them to alternate farming technologies.

Immediately provide the stressed farmers with access to alternative sources of finance to mitigate their

present critical condition.

Identification of the poorest of the poor by the community

Family counselling to develop Family development plan

Use of the data collected to plan and monitor developmental interventions based using IT tools

Formation of SHGs and JLGs, including the poor in the groups, training them on livelihoods and

financial literacy

Facilitating the CBO to identify Self Employed Service providers (SSP) at village level to form the groups

and nurture them to provide Entitlement, Skills and Training, Financial Literacy, and Entrepreneurship

or Livelihoods together with Financial Inclusion.

The apex body will be the federated structure of the groups. It is a registered legal body. The governing

body will elect the members for tenure of 3 years, to the governing body and advisory committees. The

Federation has an overarching reach to the member groups.

Tumkur Sira Pava-gada

Chiknaya- kanhalli

Madhu-giri

Korata-gere

Gubbi Tiptur Turuv-ekere

Kunigal

Population 513200 322274 245973 215805 265184 165355 246916 194024 165024 216830

Households 129788 75014 56318 55247 65374 41498 61719 50201 42108 54669

Existing Bank Accounts

295708 177899 132274 115377 163578 95345 130040 117767 93113 123103

% Bank Accounts

57.60% 55.20% 53.80% 53.50% 61.70% 57.70% 52.70% 60.70% 56.40% 56.80%

Total Farmers Records

152484 160630 90942 107709 125213 90962 144943 91954 96139 135579

Farmers having loan

(HHD) 14818 18197 12538 14880 13372 8864 16662 13458 14559 12748

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The matured groups are eventually exposed for availing of bank’s credit for generation of livelihood

assets for regular income.

2) Livelihood Activities

Imparting knowledge and skills related to agriculture and allied activities based on locally relevant

sustainable low cost technology through the Farmers Field School. A Farmers Field school will consist of

members from the SHG and JLG groups who are keen in learning several methods of improving the

agricultural activities to generate additional income.

Low cost technology will conserve natural resources; integrate livestock with farming system,

sustainable farming such as ragi (finger millet), and system of rice intensification (SRI), sustainable

sugar cane initiative adoption (SSI).

Conservation of soil and water, organic method of pest control, production and use of manure.

Bio-pesticides extracted from local plants, its use to protect the health of plants and animals.

Non-agricultural income generation activities training such as tailoring, computer education, driving to

enhance the skills of the family members of the group for additional livelihood.

3) Agricultural Profitability and Income Improvement

Acquiring livestock assets like high yielding milk cattle, sheep and goats.

Usage of sustainable farming methods, reducing the input cost and improvement in the crop and

livestock yields contributing to incremental net income.

Adoption of Low External Input Sustainable Agriculture (LEISA) technique for agriculture. This

technique will help in substituting pesticides, fertilizers, and will align with natural process for

sustainability.

Facilitation of providing a fair and transparent platform to farmers for marketing their produce in an

open market without the interference of commission agents. This will ensure that farmers get the

highest achievable rates prevalent in the market for their produce. This will result in making the overall

agricultural activities profitable and sustainable.

Imparting Knowledge of the market through training sessions for timely disposal of the produce by the

farmers.

Mobile Digital Technology for Delivery:

During the course of CBO programme in Kunigal Taluk, it was realised that an essential component of such social initiative was effective digital monitoring and management. Davinta has designed and developed a comprehensive Community Based Organization (CBO) and Financial Inclusion package. It is a comprehensive technology platform that will be deployed on field to manage the financial transactions, community, groups internal and external activities and the ground operations. The technology will ensure monitoring and reporting of the programme anywhere, anytime and at anyplace.

The mobile technology platform will help to perform the following activities on the field:

1) Account Opening 2) Basic Banking transactions such as Cash deposit, Withdrawal, fund Transfer, Balance Enquiry and mini-

statement.

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3) Create a complete citizen database of each Taluk 4) Form cohesive Self Help Groups/ Joint Liability Groups of citizens 5) Create and maintain group accounts and manage group meeting and operations 6) Allows banks to monitor Member transactions and make an informed decision on the credit 7) Generate credit rating for Groups and Individuals as per bank’s norms 8) Generate Loan Requests, Loan Application Verification, Loan Sanction & Disbursements, Loan collection,

and Loan closure 9) Generate both Financial and Statistical Reports per Member/Group

Deliverables:

The programme aims to deliver the following:

1) Extend the immediate help to highly stressed and needy farmers from the corpus fund. 2) Other deliverables include:

Livelihood

Tumkur Sira Pavagada

Counselling sessions 492 432 396

Financial Literacy Training 984 864 792

Skills Training 492 432 396

Livelihood Training 984 864 792

Animal Health Camps 41 36 33

Financial Inclusion

Tumkur Sira Pavagada

No of Kirana Points 37 25 15

Bank Accts under Prog. 135594 116276 98236

Total Groups formed 3500 3000 2500

Qtr 1st

2nd

3rd

4th

1st

2nd

3rd

4th

1st

2nd

3rd

4th

Groups Per Quarter 500 700 1000 1300 400 700 800 1100 300 600 800 800

Credit (Rs. Cr) 10 20 30 40 10 20 25 25 10 15 20 25

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Programme Financials:

The programme financials are:

Heads Year 1 Year 2 Year 3

Taluks Tumkur Sira Pavagada 8 Taluks 8 Taluks

Credit 100 Cr 80 Cr 70 Cr 640 Cr 720 Cr

Project Mgmt Cost 50,54,760 50,54,760 50,54,760 4,24,59,984 4,45,82,983

Admin Cost 6,62,112 6,62,112 6,62,112 55,61,741 58,39,828

Programme Cost 2,77,82,476 2,41,45,656 2,15,28,756 18,08,41,554 18,98,83,631

Cost 3,34,99,348 2,98,62,528 2,72,45,628

Total Cost 9,06,07,505 22,88,63,279 24,03,06,442

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2. Introduction

Vattikuti Foundation

Vattikuti Foundation was established with the aim of poverty alleviation in rural India. The Foundation started addressing the needs of the rural population in the areas of entitlements, education, employment, enterprise and health and took numerous initiatives for the social and economic uplift of the rural population. After working for the last few years in this area, Vattikuti Foundation has established that rural community can be skilled at different commercial tasks, and if provided access to capital required for these activities, can move itself out of poverty. Vattikuti Foundation believes that the most important factor to bring people out of poverty is to link them to the mainstream credit, and provide them support for a Livelihood program that can utilize the credit to create income.

Davinta Technologies, the technology partner, is one of the constituent companies of Vattikuti Ventures that employs more than 2,500 professionals worldwide, is based out of Bangalore, India. Davinta is a Product Company specialising in the financial services domain. Davinta has a vast experience in providing mobile payment solutions to clients across the globe.

Community Based Organization & Federation

CBO Formation and Functioning

Members of the rural community are formed into farmer Joint Liability Groups (JLG) of men and women and Self Help Groups (SHG) of women. At the grass root level, this structure of JLGs and SHGs are managed by a Koota level body, which is the first management in the hierarchy. The koota level body is responsible for the group of villages. This is further grouped Hobli wise into Hobli level management entities. The Hobli level management entities are then federated at a Taluk level. This federated organization is the Community Based Organisation (CBO), which is an institutional structure to monitor and facilitate the activities of all group members. The entire CBO is constituted of three parts viz. Governance, Organizational and Management structures. At the village level, the representatives of the groups monitor the activities of the group members along with the guidance and support of Village Facilitators (VFs). The governance structure is formed mainly by the elected members of the kootas.

The managerial structure involves the Village Facilitators (VF) at the village level, Samooha officers at Gram Panchayat and Block officers at. The entire programme is implemented and monitored by Financial Inclusion officer, Social Mobilization officer and Livelihood officer. These personnel are responsible for conducting farmer field schools (FFS), administration of the programme, bank linkages, credit disbursement etc. The programme is managed by the CEO through the layers described above whereas the governance is by Board of Trust through the Chairman of the federation. The Federation is registered as a tax paying Mutual Benefit Trust (MBT).

Vattikuti Foundation, along with other stakeholders, aims to strengthen the CBO by guiding its governance team and lending management team so that the CBO could in the long run function independently and (a) continue providing FI services to its member groups (b) graduate to promote market linkages to the produce (primarily agricultural) of its constituent members. The BC/BF commission from the financing bank and members contribution for the services availed were proposed as the major revenue sources to achieve financial sustainability of the CBO to function as an on-going concern.

Box 1.2.3.

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CBO Hierarchy

CBO Institutional Structure

Background

India’s SHG initiative has been around for the last three decades proving to be an effective poverty alleviation and women empowerment program that have not only become visible across the country but is now considered a major development thrust in its own right. While bank linkage of the SHGs gradually grew, predominantly in the southern states, there remain regional disparities with limited progress in western and Northern regions.

Women benefitted tremendously while becoming members of SHGs and have emerged stronger through the program. Male farmers too appreciated the benefits the SHG movement brought about to society and have converged to form Joint Liability Groups. These JLGs have been extended extensive financial interventions by the Government in the form of interest subvention and favourable conditions for credit Linkage.

Through its sizeable FI in Tumkur District of Karnataka the Vattikuti Foundation has developed extensive experience and knowledge in promoting and nurturing the SHGs and JLGs into strong financial entities with a sustainable livelihood thereby substantially improving their cash flows for long term sustenance.

The key to the success has been Community Based Operations where great emphasis was laid on Community influence on Group behaviour through an intimate knowledge of community member’s needs and capabilities.

Group cohesiveness and homogeneity has been achieved through a steep learning curve with a unique system developed in selecting members, motivating them and promoting Group formation. Once formed, the groups were then carefully nurtured over a period of six months where their capabilities and skill sets were developed, their internal financial credentials established and group behaviour stabilised. Only when they were mature enough, were they exposed to an external bank linkage.

Various steps involved in the operations are:

Collection of complete demographic data on all the families in the area of operation. The database has not just the family details, but also specific data on asset ownership, primary occupation of the member, land holding and crop pattern in case of agriculture, cattle holdings, type of dwelling unit etc.

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The data collected is validated with the Gram Sabha to ensure that the community validates the status of each family before the data is entered into the database.

Based on the data, groups are created with members from each family, ensuring homogeneity In terms of location, livelihood, income and expenditure levels so that the groups have common objectives and are cohesive. With the unique family and member code, a member once associated with a group would not be permitted to be in another group. Later Biometrics and De-Duplication has been used to enforce this rule.

The groups are given inputs on managing their finances, including cash flow management, savings as a means of creating secure incomes in time of need and interdependencies within the group

Bank accounts are created for all members of the group as well as a group account, which will be used for all financial transactions within the group or with the Bank. In addition, UID number details are taken for all members, and where members do not have the same, the member is helped to get a UID registration from the nearest Registrar organization.

The groups are encouraged to inculcate a savings habit by setting a minimum periodic savings that they have to contribute within the group, and ensuring that such savings are collected and retained within the Accounts of the group.

Such savings and other income of the group is then available for lending to its members, at interest rates as determined by the Group. In the first six months from when the group is formed, such saving amounts are the only loans available to members- Internal Lending- and their repayment as per the schedule set by the group is closely monitored.

The matured groups are eventually exposed for availing of bank’s credit for generation of livelihood assets for regular income.

The groups are federated at various levels corresponding to the administrative structure of the Taluk, and have an Apex Federation at the Taluk. Great care has been taken to prevent politicisation of this federation with control elements at each level.

Introduction of Electronic book keeping and Digital management for CBO activities at current area of operations, Kunigal, Karnataka

While carrying out CBO activities in Kunigal Taluk of Tumkur District, tremendous issues were encountered in monitoring day-to-day operations. In the absence of technology information, weekly meetings, weekly savings and internal loans had to be tracked manually. Credit transactions and recoveries were reconciled over very large intervals due non availability of real time information from the bank. This led to serious shortcoming in monitoring the entire Financial Inclusion Process. It further led mounting NPA’s and adoption of fraudulent practices by the staff.

VF commissioned its sister company, Davinta to develop a comprehensive product that could address the concerns of both VF and its NGO partner to monitor and manage the CBO activities. Davinta developed a product whose CBO module provides a diligent Loan system covering detailed data capture of the population, categorization, group formation, generation of loan applications from the Groups (loan origination), collection, NPA management, MIS and reporting of loans extended to SHGs, JLGs and individual members and comprehensive and constant monitoring and alert mechanism.

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3. Approach

Philanthropic approach is to form communities and provide credit opportunities for these communities at an affordable low interest rate. Vattikuti Foundation works with NGOs, Banking Correspondent/Banking Facilitator to form the communities and further nurtures them through financial literacy programs and capability building training until maturity.

Social enterprise approach is to provide the front end technology platform, integrate with Bank’s systems and enable various transactions utilising both the card and card-less channels. The Social Enterprise takes the ownership of operations and technology management along with collaboration with Banks, Business Correspondents and other players in the eco system.

In the ecosystem, BC /BF (Banking Correspondent / Banking Facilitator) work as bank’s representatives and are appointed by the Banks themselves. BC/BFs appoint agents on the ground to perform various Financial Inclusion transactions.

We are working on enabling Kirana merchants (mom and pop stores) as point of contact agents for ease of access to citizens and for enhanced cash management.

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4. Stakeholders

Stakeholders for the programme are:

1. Government

2. Vattikuti Foundation

3. NGO

4. Technology Partner - Davinta

5. Bank

6. BC/BF organization

7. Community/Federation

Government:

1) Over all monitoring of the programme

2) Funds arrangement through CSR for the programme

3) Help from other Govt. departments / machinery

Vattikuti Foundation:

1) Program Management and Monitoring

2) Coordination with All stakeholders

NGO:

3) Group formation & nurturing

4) CBO formation and management

5) Livelihood programs and Financial Literacy Program

6) Skill building training

7) Linkage to the credit through Bank

Technology Partner – Davinta:

1) Application Software & Maintenance

2) Roll out of solution

3) Train the trainers and few agents (if required)

4) Helpdesk support for Registering Technical issues

5) Application support (L2, L3) for Technical issues

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6) Hosting & Infrastructure support

Bank:

1) Provide necessary technology linkage to their system ( CBS and LMS)

2) Provide credits at a lower interest rate

3) Facilitate / support the BC / BF, Technology partner for the program and adequately compensate them as per the industry best practices

BC / BF:

1) Manage and maintain the Agent network

2) Field Operation for financial transactions

Community / Federation:

1) Provide support to the program

2) Achieve self-sustenance

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5. Mobile Digital Technology Platform

AltiFin – Key Functional Modules

Davinta’s AltiFin technology platform will be used for the following transactions on the field:

Enrolment (KYC): captures the customer information, such as, customer name, contact details, personal details, customer’s photo, ID photo, AOF photo, fingerprint details, etc. This is customizable as per the bank’s KYC requirements. In addition the enrolment module enables e-KYC from CIDR

Authentication: AltiFin platform supports Authentication via Biometric (both Customer Authentication System hosted for Bank as well as UIDAI CIDR system through the Bank’s ASA) , PIN /password,

Business Correspondent Operations Management: AltiFin platform facilitates complete BC operation management. Some of the key aspects are :

– Agent Management (View , Add)

– Device Management & Allocation

– BC/BCA’s Transaction reports

– Limit & Cash Management

Community Based Organization (CBO) activities: AltiFin helps manage CBO activities and links the transactions to the bank’s system. Some of the key capabilities are listed hereunder:

– Create a complete Citizens’ Database in the villages covered

– Form cohesive Self Help Groups/ Joint Liability Groups of citizens

– Create and maintain group accounts

– Record minutes of meeting as per the SHG guidelines. Allows banks to monitor Member transactions and make an informed decision on the credit

– Generate credit rating for Groups and Individuals as per bank’s norms

– Generate both Financial and Statistical Reports per Member/Group

– Loan Requests

– Loan Application Verification

– Loan Sanction & Disbursements

– Loan collection

– Loan Closure

Payment & Banking Services: The BSBD accounts can be operated as per the banks policies through a Smart Card or Magnetic stripe Card or even without a card. Some of the key features it enables are :

– Opening of BSBD , TD , RD , OD accounts

– Issuance of KCC/GCC

– Cash Withdrawal

– Cash deposit

– Balance Enquiry

– Funds Transfer / Remittance (intra & interbank)

– SMS Cash: Account to Account (i.e., Customer to Customer) and Account to Cash (i.e., Customer to Non-Customer); Withdrawal through Micro ATM or ATM

– Mini Statement

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Non – Banking Transactions: AltiFin Platform supports a variety of non-banking transactions as well. Some of the other key features supported are listed hereunder:

– Mobile payment & top ups

– Bill payment (electricity, insurance, telephone etc.)

Reports & MIS: AltiFin Platform has a Report generating module that supports both viewing and export to Excel, PDF, etc. Various reports can be generated based on

– Geographical Location

– Agent Based activity ( for analytics and forecasting)

– All Ledgers and Financial Statements

– Audit Trail Report

o Agent Activity Based Report

o Customer Portfolio Report

o System Reports

o Audit Logs

– Group Progress and Management

– Over All Report – Bank / BC / State / District / Agent / Product / Total Enrolments / Total Account Opened / Total Pending at VF and Davinta / Total Pending at Bank / Total Transactions Count & Amount

– SOD / EOD Report

AltiFin – CBO

AltiFin CBO solution manages CBO activities and links the transactions to the Bank’s system. CBO module enables users to perform community based operations such as enrolling members, group management (SHG & JLG), conducting group meetings, maintaining records of internal savings and internal credits transaction, and managing and monitoring external loan process using a handheld device and web interface.

The following steps are undertaken to ensure smooth operation of CBO’s:

Enrolment (family details, member details, land details, asset details etc.)

The agent will initially enrol the family along with its members on the AltiFin platform. The details collected are Family details, member details, land & crop details, Asset details, Income & expense and Savings/Liabilities. Photograph and biometrics also captured at time of enrolment. A unique family code and member code is generated from the system. AltiFin can connect to the credit rating agencies to provide the current credit rating of the members. AltiFin captures the census code of the members and habitation code as per the government’s definition.

Group Formation (SHG / JLG)

Post collection of family details (along with other information), the agent forms groups of like-minded individuals (SHG or JLG) with the help of the AltiFin Platform. Groups are formed ensuring homogeneity in terms of location, livelihood, financial and social status. BC admin reviews and approves the formation of group. De-duplication applied on the demographic and biometric data. A unique group code is generated by the system.

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Business rules for the group formation are configurable in the system as per the requirements of the bank.

Group Nurturing and Stabilization

The group is nurtured over a period of six months facilitating inputs on managing finances. AltiFin platform keeps track of group meetings, weekly savings and internal loans and recovery availed by the group members.

The AltiFin platform allows agents to upload the group meeting details from the

handheld device such as tablet to the back-end server. The back end maintains the

meeting history of the groups.

The agent collects the internal savings of the group, enters the collection into the system

and print a receipt at the field using AltiFin platform.

The agent initiates an internal loan request of the group members during the meetings at

the field level.

AltiFin creates a group savings account and group external loan account.

External Loan (SHG – credit linkage)

Agent initiates a loan application process for availing an external loan by the group members.

Automated loan application generation from the system

AltiFin supported Pre-Sanction inspection and approval

AltiFin supported Loan sanction by the Bank’s Officer

AltiFin supported disbursal of loan from the group account and eventually movement to

member accounts.

AltiFin supports smooth and immaculate loan recovery and closure

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6. Roles and Responsibilities

Government Vattikuti

Foundation BC/BF Technology NGO Bank Federation

Field Activities

Overall Monitoring ,

Funds arrangement

and Support for the Programme

Primary

Programme Mgmt. and

Coordination with all

Stakeholders

Primary

Identification of Area of

Operation and Issuance of Mandate

Primary

Secondary

Primary

Formation of a CBO in the

identified area of Operation

Primary

Secondary

Primary

Awareness Programme for the customers

Secondary

Secondary Primary

Comprehensive data collection

of the citizens in the identified

area

Secondary

Primary

Formation of SHGs/JLGs

Secondary

Primary Tertiary

Information related to

SHG/JLG and Individual

members to Bank

Primary

Secondary

Initiation activities of the Group - Saving,

Livelihood Program

Secondary

Primary

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Federated structure and

Support

Tertiary

Secondary Primary

Managing and Monitoring the Progress of the

Group

Secondary Primary

Initiate Loan request to Bank

Primary Secondary

Coordinate with Bank and Group

for Sanction, Documentation and Disbursal of

Loan

Primary Secondary Primary

Monitor End Use of Loan

Primary Secondary Tertiary

Monitor Regular Repayment of

Loan


Enable Financial Transactions by

the members

Primary Primary Secondary

Reporting of Progress to

Bank

Primary Primary Secondary



Technical Activities

Procurement of Hardware and

Network equipment

Primary Secondary

Installation of Technology

System in Bank's Premises/Private

hosting

Primary Secondary

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Government

Vattikuti Foundation

BC/BF Technology NGO Bank Federation

Providing Interface

Message Formats for integration of

Technology System to Bank's

CBS

Secondary Primary

Integration and Testing

Primary Primary

Providing Keys for encryption of

Messages

Secondary Primary

Going Live Primary Primary

Setup of Bank as an Entity

Tertiary Primary Secondary

Setup as a Corporate BC in

System

Tertiary Primary Secondary

Training of CBO Primary Secondary Primary

Setup of BCA in System

Secondary Primary Tertiary

Field Setup of BCA


Training of BCA Primary Secondary

Operationalization of BCA

Primary Secondary

Monitoring of BCA/BC

Primary Secondary

Administrative Activities

Primary Secondary

Reporting Primary Primary Secondary

Reconciliation Secondary Primary Primary

Billing Secondary Primary Tertiary

Payments Secondary Secondary Primary

Change Management

Secondary Primary Primary

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7. Programme Financials

The programme financials are:

Year 1 Year 2 Year 3

Tumkur Sira Pavagada 8 Taluks 8 Taluks

Credit 100 Cr 80 Cr 70 Cr 640 Cr 720 Cr

Project Mgmt Cost 50,54,760 50,54,760 50,54,760 4,24,59,984 4,45,82,983

Admin Cost 6,62,112 6,62,112 6,62,112 55,61,741 58,39,828

Programme Cost 2,77,82,476 2,41,45,656 2,15,28,756 18,08,41,554 18,98,83,631

Cost 3,34,99,348 2,98,62,528 2,72,45,628

Total Cost 9,06,07,505 22,88,63,279 24,03,06,442

8. Summary

The Government of Karnataka is seized with the immediate plight of the stressed farmers with a spate of suicides in the state. With an urgent need to address the issue in a holistic and comprehensive manner, the govt. has invited support from the corporates and social organizations in finding both an immediate as well as a long term solution.

It is with this view that the Govt. has joined hands with Vattikuti Foundation (VF), its technology partner – Davinta, NGO and BC partner, to offer an integrated programme of Financial Freedom and Livelihood through tying up with local Community Based Organizations (CBO) in Tumkur District. CBO model aims at bringing the social and economic upliftment of the rural people.

This Programme along with the relevant stakeholders will

o Immediately ameliorate the current stressed condition of the farmers in Tumkur District

o Make Agriculture Profitable for the farmers by providing them skills inputs and market

linkages

o Prevent Farmers suicides in Tumkur District

o Wean away the farmers from the scourge of unscrupulous money lenders by offering them

resources from the mainstream financial institutions

o Provide the community with self-sustainability by equipping it with skills and financial literacy

o Introduce main stream financial sources for building a sustainable eco system

o Use Mobile Digital technology for delivery of the programme

Date post:	12-Jun-2018
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