By Vikram Murthy, Summer Intern - IIM Calcutta
“Once we identify the borrowers we would finance their expansion plans and then get them mentored by experts in areas that the borrowers would need help in!” When Ram finished explaining his idea I was excited by this first-of-its kind initiative, the mentoring initiative, which lends a helping hand to borrowers who have the risk appetite and the entrepreneurial ability to scale up their businesses.
Ruth does door to door apparel selling
We took a couple of weeks to come up with the scope of the project and Smita simultaneously was scouting for partners who would be most suitable (and willing) to initiate the pilot. Luckily New Life, RangDe’s partner in Trichy was more than willing to provide the support we needed. Once their buy in was obtained, Archana and Vikram set out to Trichy. The first day ended with identifying a potential field mentor. We decided to work with Mrs. Gayathri simply because she comes with loads of enthusiasm and shares our passion.
The second day on the road proved to be more fruitful as we visited a suburb in Trichy and interviewed a large number of borrowers. Being in the suburbs of a city, these borrowers were more market savvy (in terms of knowledge of competition, market size, loan expectations etc) and gave us quite a few insights into marketing!
Most of the members in the team though had a consensus candidate by end of day 2, Mrs Routh, who sold womens daily wear apparels. She surprised us by her policy of credit sales and neat record keeping, as well as her ideas for expansion (she wanted to sell sarees in the same neighbourhood which had roughly 2000–3000 families).
Another borrower, whose business we found attractive, was Mrs Kala, who ran a shop selling fruit juice. Its location on the highway and the enterprising nature of the borrower enticed us towards the business.
Kala runs a juice centre and wants to expand her business
Mrs Gayathri played a major role since she was the field mentor and spent a lot of time with the entreprenurs including doing market surveys. in the near future. A special mention must be made about Mrs Gayathri here. The lady has a keen sense of business and is good with her communication skills as well. We could not have asked for a better field mentor for our pilot phase!
The borrowers need time to come up with the expected loan amount figures and Mrs Gayathri sent in the detailed reports of the 3 candidates. These reports included the cash flows, credit sale details, business environment details and a summary report by the field mentor. These inputs would then be fed into the system at RangDe (work in progress) which would help obtain an online mentor for the business. The online mentor would be some one with a good deal of work experience in areas like marketing, operations etc and she/he would primarily deal with the field mentor in order to pass on ideas to the borrower.
Though both Mrs Kala and Mrs Routh asked for higher amounts (we did not want to burden them with huge loans as we wanted them to take the phased approach as well). Their loans are being processed and in a few weeks time we would be beginning the implementation of the expansion plans.
We are very hopeful about the success of the program and have no doubts that if the program were to work and be scaleable the pilot in Trichy would set the benchmarks for any future implementations of the initiative.