Svatantra Microfin

Svatantra Microfin (Sanskrit: स्वतंत्र) Svatantra, which means freedom in Hindi, is a mid-size Indian microfinance organisation based in Mumbai.[2] Since receiving a license from the Reserve Bank of India in 2013, Svatantra has provided financial and non-financial solutions to encourage entrepreneurship in rural areas, primarily amongst women.[3][4]

Svatantra Microfin
TypeMicrofinance Organisation[1]
IndustryFinancial services
FoundedFebruary 17, 2012
FounderAnanya Birla
HeadquartersMumbai, India
Area served
Maharashtra, Madhya Pradesh, Chhattisgarh, Uttar Pradesh, Bihar, Odisha, Gujarat, Rajasthan, Jharkhand, West Bengal, Punjab, Haryana, Assam, Tripura, Karnataka
ProductsMicrofinance
AUM₹7000 crore ( in 2023)
Websitehttp://www.svatantramicrofin.com/

History

Svatantra Microfin was founded in 2012 by Ananya Birla, Co-Chairperson of ASSOCHAM’s Microfinance Council of India and daughter of Indian industrialist Kumar Mangalam Birla.[5][6] Svatantra was established with an aim to address the growing income gap in India, and the company is dedicated towards the financial inclusion of rural women.[7]

In 2014, the organisation won Gold Award in the start-up category by the Skoch Financial Inclusion and Deepening Award.[8]

Company declared profitability in three and a half years.[9]

Svatantra was the first microfinance institution to receive the Non-Banking Financial Company – Microfinance Institution (NBFC-MFI) license from the Reserve Bank of India.[10] Beginning 2016, ICRA rated Svatanta A- with stable outlook for the Rs. 100.00 crore bank facilities[11] and an MFI grade of M3+ stating that the company is able manage its microfinance activities in a sustainable manner.[12]

In 2017, Svatantra launched Saathi, an end-to-end cashless solution.[11] Svatantra also uses Aadhaar to determine credit score, using biometric identification.[8] Company also has a mediclaim product.[11]

Svatantra has 100% cashless disbursements[13] and has the lowest lending rates of any MFI in India.[14]

Svatantra Microfin has Rs 7000 crore assets under management.[14] The company has 804+ branches spread across 19 states.[10][12] The company is currently funded by nine financial institutions, including public and private sector banks and NBFCs.[12]

In August 2023, it was announced Svatantra Microfin had acquired the Bengaluru-headquartered microfinance company, Chaitanya Microfinance from Navi Group, for $178.5 million.[15]

Application of Microcredit

Svatantra's microcredit policy is based on a group lending model, in which participants take out unsecured loans to finance businesses or other sources of revenue while serving as one another's group's surety. ensuring credit discipline and prompt repayments through peer pressure.[3]

It offers livelihood-related loans at 19.25-20.00% interest rate, lowest in India.[14] It disburses money through National Electronic Funds Transfer (NEFT); and also helps its clients open bank accounts, adhering to one of its core missions of financial inclusion.[5]

References
  1. "Birla heiress lends to poor amid banking licence bid". Livemint.com. 2013-06-24. Retrieved 2015-05-05.
  2. "Svatantra Microfin launches cashless mobility solution". www.estrade.in. Retrieved 2018-06-29.
  3. Bloomberg (2013-06-24). "Birla heiress lends to poor amid banking licence bid". Mint. Retrieved 2018-06-29.
  4. "Ananya Birla | 2018 Forbes Asia Forum: The Next Tycoons". www.forbesasianexttycoons.com. Retrieved 2018-06-29.
  5. Deepti Chaudhary (29 October 2015). "Ananya Birla: Her father's daughter". Forbes India. Retrieved 2 November 2015.
  6. Rodrigues, Janice. "This pop star means business". www.khaleejtimes.com. Retrieved 2018-06-29.
  7. "Interview: Ananya Birla On Why India Needs More Brave Women Entrepreneurs. | CEOWORLD magazine". CEOWORLD magazine. 2017-09-15. Retrieved 2018-06-29.
  8. Sharma, Sahib (2017-02-22). "NPCI begins pilot project to digitize transactions in microfinance sector". Mint. Retrieved 2018-06-29.
  9. Hetavkar, Nikhat (2017-06-30). "Svatantra Microfin reached break even in FY17". Business Standard India. Retrieved 2018-06-29.
  10. "Svantantra Making Headway in the Differentiated Banking Space". Moneycontrol. Retrieved 2018-06-29.
  11. "Svatantra Microfin launches cashless solution 'Saathi'". @businessline. Retrieved 2018-06-29.
  12. "Svatantra plans to have 190 branches". The Economic Times. 2017-06-30. Retrieved 2018-06-29.
  13. "Svatantra Microfin Lowers Interest Rate by 350 Basis Point". The New Indian Express. Retrieved 2018-06-29.
  14. Ray, Atmadip (2018-04-09). "Svatantra Microfin lowers lending rate to 19.25%". The Economic Times. Retrieved 2018-05-10.
  15. Singh, Manish (2023-08-08). "Sachin Bansal sells Navi's microfinancing unit for $178.5 million". TechCrunch. Retrieved 2023-08-10.
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