New Delhi: Small entrepreneurs who borrow from microfinanciers are often starved for information about business opportunities. A new business news agency aims to bring relevant news and views to them for the first time through newsletters, mobile messaging and community radio.
MySME News is a result of the efforts of three organizations—Paris-based Internews Europe, which funds community media projects worldwide; Plural India, a New Delhi-based non-profit; and Mahiti Infotech Pvt. Ltd, a social enterprise that specializes in providing information technology solutions to civil society groups.
It was formally launched at a microfinance summit in Gurgaon a fortnight ago. And its first small step—a bimonthly, four-page newsletter, printed in Bengali and English—has already had a debut print run of 900 copies, distributed in the slums of Kolkata.
Atul Ramchandra, Internews Europe’s representative in India and MySME News project director, said this was just the first among several plans it wants to put into action to reach out to the poor. “Our objective is to take the news service to the mobile platform, where subscribers can call in for information as well as receive alerts on specific information. We want to provide very, very local news,” he said, adding that about two dozen stringers will be hired to report on the performance of microfinance institutions (MFIs).
Internews Europe has received about €780,000 (Rs4.88 crore) to start the project in Kolkata; a small fraction of this money will also go for a similar trial run in Nepal. Each newsletter costs an average Rs4 to produce. While the project will sustain from the grant it has received for the next two years, it hopes to put a business model in place and generate revenue from multiple streams such as producing customized newsletters for MFIs for a fee, as well as charging a nominal fee from its key constituents—the poor and marginalized readers.
“While we will bring out customized newsletters for specific clients, the focus will remain on the challenges faced by micro entrepreneurs ,” said Shivendra Sharma, executive director of Plural India and former ED of microfinance player PlaNet Finance in South Asia.
In Kolkata, MySME News has already brought out customized newsletters for Ujjivan Financial Services Pvt. Ltd and SKS Microfinance Pvt. Ltd with a few thousand print runs, but hasn’t started charging a fee yet.
“The main idea of the project is to offer the poor a chance to make intelligent decisions through information,” added Sreekanth S. Rameshaiah, ED of Mahiti, which is creating the software to manage and transfer content.
About 50 million people borrow money from MFIs and self-help groups. At least 200 million more, who live above the poverty line, still need access to credit. “Borrowers need the right information mix on different products, especially when microfinance institutions are cross competing,” said Alok Misra, director of rating and research at Micro-Credit Ratings International Ltd, a rating agency for the sector.
With little information, most microcredit borrowers largely rely on word of mouth information to make investment choices. “Most people get it (information) from 10 houses this side and 10 on that side,” said Sharma.
While the project is still at an infant stage, it hopes to break even in two years. After reaching a critical customer base of 100,000-300,000 customers, it also plans to pitch social marketing to deliver public messages relating to health, education and vocational training.
Pritha Sen, director at Plural India, takes a long view beyond disseminating just news. “Even if we have managed to create 10 successful enterprises in remote parts of the country in 10 years, we would say we have achieved our objective.”