By B N KUMAR
MFIs have major role in post-pandemic bounce-back, says Vivek Tiwari of Satya Microcapital
The past year made us all witness massive modulations in the way businesses operate in the wake of the deadly virus. It has made us realize the relevance of financial inclusion for safeguarding those nestling in rural hinterlands. Financial Inclusion serves as the key driving force for bridging the gap between unbanked population and formal means of credit access. It is not only channelizing the savings of those living at the bottom of the pyramid but is also empowering them to fulfil their entrepreneurial ambitions via provision of hassle-free credit, thereby inducing boost to the economy. In India, MFIs are fundamentally driving financial inclusion as they consistently keep on introducing and offering financial products as per the needs of the marginalised. MFIs are also improving financial literacy and financial awareness in the nation which forms an indispensable function of financial inclusion.
“Life is an echo, what you send out, eventually comes back to you,” says Vivek Tiwari, MD, CIO & CEO, SATYA MicroCapital Ltd. His missionary zeal to serve the society at large has always driven him to induce a real time impact in lives of those at the bottom of the pyramid. During his professional career of more than twenty years, Tiwari have always valued people as key capital. The main agenda of Tiwari behind laying the foundation of SATYA was poverty alleviation and this served as the pole star to venture into the world of microfinance so that financial services can be offered to low-income populations, thereby improving socio-economic status of developing countries. He understands the existential crisis downtrodden have to confront in their daily lives and is earnestly working towards improving their life state by facilitation of hassle-free credit access for means of livelihood generation and income growth, Tiwari’s team members say.
Tiwari has fundamentally contributed to the microfinance sector since formative years. He is credited for the geographical shift of microfinance from South India to North India and for accelerating the growth & scale of MFIs in Northern parts of India.
Before joining the Board of SATYA as Managing Director, Tiwari has ardently worked in the development sector for almost 15+ years with expertise in microfinance and lending portfolio of more than 10,000 Crores. He was with Gujarat-based Vardan Microfinance where he initiated operations based on the Grameen Model and trained and developed workforce at middle level management. He has also worked with CASHPOR Micro Credit. He was also actively associated with certain developmental projects supported by UNICEF and NABARD. Subsequently, he worked with Satin Credit Care Network Ltd (SCNL) as a Chief Operating Officer (COO) for more than 8 years. Pioneering Banking Correspondent Lending for banks, he has successfully implemented the WSHG (Women Self Help Group) & National Rural Livelihood Mission (NRLM).
Cut to Delhi-based Satya MicroCapital. It all started with the realization and of the fact that poverty is the main subject of concern in improving the economic status of developing countries. With time, this realization transformed into inexorable aspiration of bringing a real time positive impact in lives of those living at the bottom of the pyramid. The NBFC’s mission is to be catalyst for socioeconomic upliftment of five million households by the year 2025, says Tiwari. Satya started its journey in October 2016 and has registered impressive growth having reached Assets under Management (AUM) of Rs 100 crore in just 1 year. The company has emerged as one of the fastest growing MFIs in the country.
SATYA is not only a promoter of financial inclusion in territories of its active operations but is also an integral part of Indian Microfinance Sector. As per the Bharat Microfinance report 2020, around 53 MFIs are active in Uttar Pradesh and are playing an important role in promoting financial inclusion and SATYA is one of them.
Satya is committed to establishing responsive governance and risk management frameworks for building a sustainable organization, explains Tiwari. “We have made client centricity as the hallmark of our day-to-day operations. We are striving to make Satya one of the greatest places to work for the employees. Satya has been promoted by professionals having significant experience of scaling up Microfinance programmes in one of the poorest regions of India. We are also being supported by investors having history of promoting sustainable and scalable organizations,” he says.
“We have profound belief that use of technology can increase efficiency, reduce risks and enhance overall customer experience,” says Gaurangini Jain, Deputy CEO. “With this belief we have adopted cutting edge technology to power our operations which includes paperless transactions, cashless disbursements, geo-tagging of client and staff locations, E-KYC of clients and E-Learning platform for training staff members,” Jain says.
“The credit of conceptualizing, planning, executing, operationg the RBI registered NBFC-MFI goes to Tiwari himself,” says CFO – Sudhindra Sharma. The main agenda behind laying the foundation of this SATYA MicroCapital Ltd. Since day 1 was to offer financial services to low-income populations so that their financial burden can be minimalised. SATYA is a part of the industrial ecosystem with primary focus being laid on understanding the needs of the poor and on devising better ways of delivering services in line with their requirements, developing the most efficient and effective mechanisms to deliver finance to the poor, creation of opportunities for self-employment for the underprivileged thereby delivering a ray of financial independency.
Background: Tiwari holds a Post Graduate Degree in Rural Development & Management from the Institute of Engineering & Rural Technology, Allahabad. Apart from acquiring prolific experience of nearly two decades in the Microfinance and Development Sector, Tiwari is also a certified professional of Concentration in Management Programme from Boulder Microfinance Training, Italy. His proficiency outlines extreme focus on the innovative deployment of technological framework for incubating responsible lending, financial inclusion, social entrepreneurship, and impact investing within national boundaries.
Tiwari has always been of the firm belief that the way to move forward is together! He prefers to have a holistic and all-encompassing approach rather than an individualistic one. He gives crucial importance to technology, which has proven to be a game-changer, especially in an industry as niche as ours.
“As more and more processes at SATYA are beginning to get nested under the digitisation canopy, our services are becoming more efficient with our accuracy levels reaching newer heights to satisfy the clients’ needs and demands every day,” says Alisha Anand, AVP - Marketing. Moreover, with the advent of such technological novelties, SATYA needs to be constantly transformative and dynamic in all its processes and business operations. This is further supplemented by the focussed approach towards societal upliftment, especially women empowerment and therefore complemented with respect to the company vision and mission to holistically develop the people nestled at the bottom of the pyramid, Alisha points out.
Coming from a humble background, Tiwari understands the ground realities and possesses a heart for the social causes pertaining to the underprivileged people of the country. He has always focused on the themes of employment generation and entrepreneurship promotion. With this idea in mind, he founded SATYA, to give back to the society and aid in the empowerment and sustainable development of the people at the grassroots.
Service – it’s all in genes
Born into a simple middle-class family in Sultanpur, Uttar Pradesh, Vivek Tiwari is the first child of his parents - father an advocate and mother, a housewife. He has developed a sense of responsibility within him since early childhood. Being the elder one, he was a mentor to his four younger siblings. Vivek was very studious and had all the qualities of a prodigious leader since childhood, his father recalls. The roots of this leadership were also within family genes which he received as a gift from his grandfather. His grandfather, Radheshyam, was a primary school teacher. He was extremely popular for the work he did for education, he is very popular in the district and surrounding areas. Alike his grandfather, Vivek was also very dedicated towards education, due to which he is the favourite grandchild of his grandfather. He imbibed the learnings and values of self-sufficiency, independence post senior secondary during hostel life. It was this early time in his life, when Vivek inculcated a balance between his emotional and practical approach. The roots of prodigious leadership were also within family genes which he received as a gift from his grandfather.
Following the ideology that successful entrepreneurs always develop habits which help them in achieving great success, Tiwari prefers to do yoga and meditation to boost his strength and immunity. In his spare time, he also likes to watch news channels to keep himself abreast about society and country at large. Even though he considers his hobbies as old fashioned, but he ardently believes all his hobbies are therapeutic for him and helps him perform with better efficacy in all walks of life. He also loves to read as he is always on a quest for knowledge.
Born in Sultanpur, Uttar Pradesh, at an age of 9 years, Tiwari was enrolled in Navodaya Vidyalaya which was built under the New Education Policy in 1986, whose ethos and values has helped shape his personality today. He imbibed the learnings & values of self-sufficiency, independence post senior secondary during hostel life. It was this early time in his life, when Tiwari inculcated a balance between his emotional and practical approach. The roots of prodigious leadership were also within family genes which he received as a gift from his grandfather.
He holds a postgraduate diploma in Rural Development and Management from the Institute of Engineering and Rural Technology, Allahabad. With the fervor inside him “to serve the society at large, especially for women and children”, he joined the development sector.
Tiwari has also been felicitated with the BFSI Leadership Award as well as Bharat Jyoti Award by India International Friendship Society. Recently, he has been bestowed with Most Promising Business Leaders of Asia Award by Economic Times at 5th Edition of Asian Business Leaders Conclave 2020. He is also a certified professional of Concentration in Management Program from Boulder Microfinance Training, Italy.
For his contribution for furthering the financial inclusion movement and playing a pivotal role in accelerating the JLG/WSHG movement, Vivek Tiwari has also been felicitated with the BFSI Leadership Award as well as “Bharat Jyoti Award” by India International Friendship Society. Recently, he has been bestowed with Most Promising Business Leaders of Asia Award by Economic Times at 5th Edition of Asian Business Leaders Conclave 2020. Under his exemplary leadership, SATYA has been recognized as MOST TRUSTED MICROFINANCE INSTITUITION OF INDIA and has also been felicitated with ATAL Achievement Award 2020 on 29th December 2020 at Constitution Club of India, New Delhi. He has also been elected as Member of Governing Board of MFIN.
First Project: SATYA MicroCapital initiated its operational journey with loan disbursements in Ramlalgarhi, Dhanaura, and Barodah villages of Sikandrabad, Uttar Pradesh on November 1, 2016. The first project of SATYA is coined as Income Generating Loan. It is one of the primary loan products of the MFI which was offered to 50 underprivileged women for provision of affordable credit access to improve their standard of living by means of livelihood generation.
SATYA has gained a massive presence in 21 states of India, currently serving over 500,000 underserved people through its 200+ branches spread across over 20,230+ villages in the country. With over 2500+ dedicated workforce, SATYA has till now disbursed loans of worth 30485 million which is a milestone of its own kind to achieve in 4 years, says Tiwari.
Inculcating the habit amongst the poor to save and providing them better access to microfinance can help poor increase their income, build household assets, get rid of the vicious circle of poverty, and attain a better standard of life. SATYA is serving this purpose by accomplishing financial inclusion to a great extent. It is providing small loans (microcredit) to help poor families to engage them in productive activities or to grow their small business. That is why SATYA is now evolved as a medium for reaching the financially excluded masses of the country to provide them all basic financial services they need. Financial Inclusion - Lending operations, especially micro lending for both group and individual lending. Also, SATYA is organizing awareness campaigns at consistent time intervals for providing digital & financial literacy to rural masses. We aim to scale up the business set ups of our clients so that they can escalate towards the next step in the lending process.
Indian financial sector reforms excluded several sections of the society. Concentration of the banking industry in urban areas had certain repercussions such as rural retrogression and farmer’s suicide. Extending the reach of formal financial institutions among the poorest of the poor should intend to get them rid out of the clutches of traditional money lenders. SATYA is thus providing a solution for these socio-economic problems through financial inclusion for sustained and long-term economic growth in India.
Pandemic and after: The pandemic and its multi-pronged effects are no more a secret topic for any country around the globe. Microfinance sector also got hit by this pandemic and is facing another big crisis after 2010 AP amendment bill and 2016’s demonetisation. MFIs have their own debt obligations and liquidity needs; post pandemic scenario is certainly going to put pressure on sector with surge in demand for more income generating loans and more gestation period. Affected cash flows of business enterprises in turn affected their microfinance service providers.
In most parts of the country, microfinance providers are facing serious liquidity crunch during COVID-19, gap between revenue and operational expenditures are increasing with depleting reserves. This shrinking liquidity may not create problem for large MFIs or those with strong stable backup but is sufficient to haunt small and mid-size MFIs. MFIs with stable financing, well-established technology platforms and strong hold on communities have higher probability to survive during and after this pandemic. During lockdown everything came to a standstill. In Uttar Pradesh, several microfinance borrowers lost their employment. In the environment of complete uncertainty, the state witnessed a very painful trend of reverse migration. According to certain official data on reverse migration, about 2.169 million have returned to Uttar Pradesh, the migrant workers who earlier used to send remittances, became unproductive all of a sudden. “There was a plethora of problems. At one side they were suffering from non-payment of loans by their borrowers, on the other hand, they had to meet their obligations of repaying to their lenders such as Banks/NBFCs/FIs. The resilience and ability to return to normalcy showcased by the clients in the past have made this certain that together we will definitely triumph this battle against worldwide pandemic,” Tiwari explains.
As for the government and RBI’s role, Tiwari advocates effective reforms and practices such as continuous liquidity support majorly to mid and small -sized NBFC-MFIs, irrespective of external credit rating, through schedule commercial banks under priority sector lending. Partial or full credit guarantee to NBFC MFIs for on lending to JLG (joint liability group) borrower or to specific borrower segment which are unserved is another need of the hour. Tiwari strongly recommends long term refinance from NABARD and SIDBI at concessional rate with no collateral for onward lending to JLG borrower or to specific borrower which are unserved similar to the refinance available for HFCs from NHB under different promotional segment.
SATYA, on its part, has set its goals right. “We will successfully expand our presence across the country covering 250 districts and 28 states. We will actively operate across the nation, thereby more aggressively providing our services to a wider section of people,” Tiwari says exuding confidence. SATYA will integrally work for uplifting impoverished people through financial stability to elevate from simply surviving to accruing savings.
Another aim is to provide women with the financial backing they always deserved, to start business ventures and actively participate in the economy, thereby rendering confidence, improving their status, and making them more active in decision-making, thus encouraging gender equality. Since the day we have evoked our journey in the microfinance space, we have always strived to be a catalyst for the socio-economic upliftment of 5 million households by the year 2025. Adding onto this, in the forthcoming years, we also want to be a preferred choice for the people at bottom of pyramid in creation of their enterprise and livelihood through a holistic approach.
As Satya’s tagline says सर्वे भवन्तु सुखिनः (Sarve Bhavantu Sukhinah) – may all be happy!
Here is a snapshot of Satya's unique schemes:
- Video KYC – SATYA has launched Video KYC in its operational workflow which allows customer verification using facial matching, automated data extraction, and Machine Learning techniques which is done in real-time. Due to lockdown, movement in the fields became difficult and to help ease and provide comfort to our clients, VKYC was initiated. Implementing this technology driven module of KYC, all interactions are recorded and stored in one place. It has helped SATYA onboard clients extremely fast using Artificial Intelligence (AI) and aided in slashing onboarding costs and drastically reducing turnaround time.
- SATYA Connect App – SATYA has developed an android-based application to “connect” with the client so that they can get all the important information & updates about their loans on a single platform in real time. This App can be accessed anywhere & anytime making the dissemination of vital information much easier with our rural customer base, especially the women segment. This app makes the client independent, wherein she/he doesn’t have to always rely on the SATYA staff for redressal of any queries but can have a real-time access on their loan features as well as have a hands-on experience regarding their daily transactional issues, reflecting any kind of operational queries they might have, which they can extract through the e-Connect App. Being a 24*7 Support & Services platform, the SATYA e-Connect App aims to provide top-notch Customer Service and Quality Business while continuing to incorporate better modules to drive productivity at all levels.
- SATYA Pay - Satya Pay Mobile App is a one stop solution which is accessible round the clock for all your multifarious Banking and Payment-related services that includes Money Transfer, Cash Withdrawal - Mini ATM (Aadhaar Based), Cash Withdrawal - Micro ATM (Debit Card), Cash Deposit, Bill Payments, Mobile Recharges, DTH, PAN Cards & Digital Payments. SATYA Pay help clients to manage and maximize your earnings by providing efficient and attractive offers/schemes. Through this application, SATYA MicroCapital Limited shall leverage its vast network of retail access points to deliver real-time, Government-to-Citizen Services and Business-to-Consumer Services in just few steps. SATYA Pay provides technology-driven real time connectivity to the unserved rural, semi-urban and urban markets in a highly Safe, Secure, Stable and User - Friendly manner.
- Digital NACH - Through digital NACH, SATYA is able to receive customer repayments in an automated manner. This has further eased out collection process wherein once the requisite permission is received through the client to the concerned authority, the installment amount gets debited directly from his/her bank every fixed day of the month/ repayment period.
- E-Sign - eSignatures have also been effectively executed by SATYA which has further enhanced the operations to run smoother without any delay or hassles due to unavailability of physical presence of the client.
- CSP Points - Thousands of CSPs or Customer Service Points have been established wherein our clients can easily reach us. They are being used to facilitate SATYA’s operations to become more robust and technologically advanced as well as giving an in-house access to all internal as well as external customers.
- Digital Repayments - Airtel Payments Bank
To address these concerns and provide one stop solution for the challenges faced during the cashless repayments by SATYA’s clients, SATYA launched a digital payment banking in partnership with Airtel in July 2020. The aim of this programme is to enable SATYA’s loan clients to repay their EMIs on time without facing any challenges and to adopt digital banking services for their day-to-day operations. The Airtel Payments Bank (APB) is a fully digital and paperless bank where a client gets range of services such as Digital banking; Quick and paperless account opening using Aadhaar based e-KYC etc. e-KYC do not require any paper-based documents, only customer’s Aadhaar number is needed. One minute of Airtel mobile talk time for every Rupee deposited while opening an account, Customer’s Airtel mobile number will be his/her bank account number, Interest rate of 2.50 % p.a. on deposits in savings accounts, the highest in India, Money transfer to any bank account in India (Free money transfer from Airtel-to-Airtel numbers within Airtel Payments Bank), Personal Accidental Insurance of Rs. 1 Lakh with every Savings Account, easy deposit, and withdrawal facility across a wide network of Airtel retail outlets. We are also in works for an auto-debit feature which would further ease the cashless repayment process for the clients.
- Emergency Loan - To ease out the financial crunch of its clients during times of stringent emergency, SATYA MicroCapital has developed a unique product “SATYA Emergency Loan”. The beneficiaries of this loan can avail its benefits in case of unplanned medical expenses (hospitalisation, delivery, accident, major illness, provision of educational support and accidental fire & flood.