New Delhi: Mahatma Gandhi was a strong advocate of strengthening village governance and economy. While the government finds different platforms to deliver and involves people by helping them avail of numerous development schemes, companies like Moksha Yug Access (MYA) develop rural infrastructure, leverage the franchising and microfinance model to roll out a range of services.
Arunoday Prakash from Livemint has a free wheeling chat with Harsha Moily, chairman and managing director on the inroads the company has made, the challenges it faces and the kind of impact projects like theirs can make. Edited excerpts:
How does your model work?
We are in the business of building efficiencies in the delivery of a range of products and services such as dairy farming, livelihoods, healthcare, agribusiness and retail to the rural poor through a technology enabled infrastructure. We establish franchising agreements with microfinance clients, initiate purchase agreements with suppliers, have buy back agreements with buyers and manage the warehousing and supply chain.
Our USP to clients lies in providing finance and market linkages and to our product/service providers, an organized platform to enable them increase their reach across rural markets.
The model involves franchising dairy units, health centres, handicraft production centres, retail outlets and agri-centres to rural households. These franchises serve as distribution outlets servicing rural markets. Financing franchisee fee to be paid by rural households is financed through the microfinance arm.
We plan to scale up to 100,000 clients, build a tried and tested franchise model across five verticals and subsequently, partner with others MFIs to reach one million households by 2010 and five million clients by 2013.
Tell us something about how you started out
MYA commenced operations hoping to build on its microfinance arm to create manpower and test its supply chain services. It launched its microfinance operations in April 2006 and today has 137 employees working towards creating wealth for the rural poor.
As of February 2008, our operations are spread across 304 villages in the Bagalkot district of Karnataka, covering a population of 478,939. We have enrolled a total of 31,027 customers and have established 13 branches and disbursed loans worth Rs79.49 million to 13,691 members, enrolled 12,541 life insurance subscribers, 2,610 health insurance subscribers, 654 cattle insurance subscribers and 2,746 goat and sheep insurance subscribers.
What’s the feedback been?
We realized that the poor need more than just a loan. They require jobs and an environment that can make an entrepreneur successful. At this point in time, our operations are focused on microfinance to build a critical mass of customers. We are however laying the groundwork for the rollout of dairy and healthcare verticals. During the franchisee selection process, we sought our clients’ opinions and found them very supportive.