8/14/2019 S3IDF Social Merchant Bank Approach.april07
1/15
1
The Small-Scale Sustainable Infrastructure Development Fund (SThe Small-Scale Sustainable Infrastructure Development Fund (S33IDF)IDF)
SS33IDF-US Cambridge, MA, USA IDF-US Cambridge, MA, USA a public charity under Section 501(c)(3) of U.S. tax codea public charity under Section 501(c)(3) of U.S. tax code
SS33IDF-India Bangalore, India IDF-India Bangalore, India a Section 25 not-for-profit company with Section 80G tax exemptiona Section 25 not-for-profit company with Section 80G tax exemption
SS33IDFIDFA Social Merchant Bank A Social Merchant Bank
8/14/2019 S3IDF Social Merchant Bank Approach.april07
2/15
2
Indias Poverty and EmploymentIndias Poverty and Employment
StatisticsStatistics 300 million living below poverty in India
About 9 million living below poverty in Karnataka state and about 35 millionin South India; majority of the poor without infrastructure services necessaryfor development
Indias labour force is growing at a rate of 2.5% annually (~7 million) butemployment is growing at only 2.3%(~6.4 million); plus there are previous
back logs
60% of India work force is self-employed many of whom remain poor;nearly 30% are casual workers (get work only when they are able to get
jobs remain unpaid rest of the days); only about 10 percent are regularemployees
90% of labour force employed in unorganised sector no social/jobsecurity; minimum wage act marginally implemented; In rural areasagriculture workers form bulk of unorganised sector while in urban, contractand sub-contract as well as migratory agricultural labourers
Indias Ninth Plan projects that at 7% growth rate per annum, the reductionin open unemployment rate from 1.9% (~7.5 million) in 1996-97 to 1.47%
(~6.6 million) in 2007.
8/14/2019 S3IDF Social Merchant Bank Approach.april07
3/15
3
Indias Rural Infrastructure StatisticsIndias Rural Infrastructure StatisticsInfrastructure (electricity and productive end-uses, telecommunication,
transport and drinking water and sanitation) is a necessary and criticalingredient for the economic growth and decline of absolute poverty
18% of villages dont have electricity and 46% of households are not covered leads to no lighting, no productive end uses thus minimal economic activity Requires Rs 1,07,823 crores for full coverage; average annual investments forlast 10 years Rs 8,800 crores
Telecommunication 1.9 per hundred of population; 98% of villages havepublic telephones but this is not sufficient; Rs 92,690 crores for full coverage;BSNL average annual budget Rs 2,700 crores
44% of rural population not covered by road network and transportation; Rs15, 643 crores for full coverage; average annual investments Rs 2,133 crores
95% of rural population have access to some sort of drinking water source.The operation and maintenance is poor due to lack of funds.
As is evident from the statistics above, the funds required to cover the demand isway above what the government (and grants from international fundingagencies) alone can achieve. Hence the most plausible solution is for others
to participate and for alternative sources of investment.
8/14/2019 S3IDF Social Merchant Bank Approach.april07
4/15
4
The Challenges Being AddressedThe Challenges Being Addressed
Millions of poor without infrastructure
services necessary for development More sustainable, innovative, business like
approaches needed
S3IDF facilitated a grass root NGO to provide lighting
and cooking services in rural areas
S3IDFs Approach is to reducepoverty by
assisting small enterprises toprovide modern energy and otherinfrastructural services
specifically targeting poor people
supporting financially sustainable
and environmentally responsibleMSME (micro/small/mediumenterprise)
covering the provision of servicesin electricity, water, sanitation,transport and telecommunications
8/14/2019 S3IDF Social Merchant Bank Approach.april07
5/15
The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 5
Safe, Improved Lighting services to HawkersSafe, Improved Lighting services to Hawkers
entrepreneur at the
solar charging station
transportation of
batteries
Reliable and
better lightingfor hawkers
For the light point projects, SFor the light point projects, S33IDF arranged the business development, technology andIDF arranged the business development, technology and
financial assistance to help the entrepreneurs increase their income, generatefinancial assistance to help the entrepreneurs increase their income, generate
employment and provide cost savings and improved lighting for working class hawkers.employment and provide cost savings and improved lighting for working class hawkers.
8/14/2019 S3IDF Social Merchant Bank Approach.april07
6/15
The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 6
Low cost Lighting Services to Poor Un-electrified HamletsLow cost Lighting Services to Poor Un-electrified Hamlets
Kerosene based openwick lamps typically used
by the poor.
LED based lights
The entrepreneur at thesolar charging station
Studying with the assistanceof LED based lights
Kerosene based lampsreplaced by LED based lights
SS33IDF arranged the business development, technology and financial assistance forIDF arranged the business development, technology and financial assistance for
accessing lower cost efficient lighting system by the households delivered at a costaccessing lower cost efficient lighting system by the households delivered at a cost
equal to the current expenditure on kerosene lighting of less than Rs 2 per dayequal to the current expenditure on kerosene lighting of less than Rs 2 per day
8/14/2019 S3IDF Social Merchant Bank Approach.april07
7/157
The ModelThe Model SS33IDF produces a stream of fundableIDF produces a stream of fundable small scale for-profit infrastructuresmall scale for-profit infrastructure
enterprises.enterprises.
The owner/operator musthave some capital at risk(even sweat equity)
Supported by technology,financing arrangements andpre-investment analyses
Cash flow to cover allcapital and operating costs.
The business must be
explicitly pro-poor,environmentallyresponsible, and shoulddemonstrate a high degreeof replicability.
A Solar powered computer kiosk run byentrepreneur in a rural village in Andhra Pradesh
8/14/2019 S3IDF Social Merchant Bank Approach.april07
8/158
Key ElementsKey Elements Business Development ServicesBusiness Development Services
(BDS)(BDS) Financial assistance and dealFinancial assistance and deal
structuring geared to facilitating localstructuring geared to facilitating localFI co-financingFI co-financing
A revolving fundA revolving fund
(debt, equity, partial guarantees, etc)(debt, equity, partial guarantees, etc) Independent evaluationIndependent evaluation Lesson learning and disseminationLesson learning and dissemination
Night Soil biogas in residential school
Implementation Challenges
Efficient ovens in silk reeling units
Cost recovery for BDS, evaluation
and dissemination Custom-design vs. replication with
some adaptation (not quite cookie
cutter)
Capacity Building
8/14/2019 S3IDF Social Merchant Bank Approach.april07
9/159
Examples of S3IDF Projects
Based on market research of infrastructure-related activities that canhave a significant impact on the poor, our current priorities are:
Lighting Biomass energy
Silk production and processing
Distribution of modern energy sources (last mile supply of LPGand electricity)
Information and communications technologies (ICT) Water and sanitation
Small/micro-enterprise based infrastructure
More than 65+ projects implemented that benefits more than 12,000people
100+ new projects are being examined
Total investments of about Rs 76 lakhs done till date and this hasabout Rs 33 lakhs of our money invested. Expected Rs 7 lakhs ofreturns through these investments.
8/14/2019 S3IDF Social Merchant Bank Approach.april07
10/15 The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 10
LPG Access for Cooking by Poor Households
LPG Cookshop a common kitchen providing poor women with clean,
convenient cooking made affordable by a pay-for-use operation.
Fuelwood collected typically
by women and children
Health hazards (from smoke and
soot) from fuelwood cooking
Cookshop in use
8/14/2019 S3IDF Social Merchant Bank Approach.april07
11/1511S3IDF
Energy-linked Information/Communication forEnergy-linked Information/Communication for
Rural SchoolsRural Schools
Kondlahalli Rural SchoolKondlahalli Rural School
SS33
IDFs innovative business and financial structuring helps ruralIDFs innovative business and financial structuring helps ruralschools introduce cost-effective computer education for students.schools introduce cost-effective computer education for students.
T Mi E i B ll k CT t Mi E t i B ll k C t
8/14/2019 S3IDF Social Merchant Bank Approach.april07
12/15 The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 12
Transport Micro-Enterprise: Bullock CartTransport Micro-Enterprise: Bullock Cart
U-Haul PartnershipU-Haul Partnership
SS33IDFs financing support to a grassroots NGO helps local small holders and poorIDFs financing support to a grassroots NGO helps local small holders and poor
farmers rent a cart and lower the cost of transporting harvested crops.farmers rent a cart and lower the cost of transporting harvested crops.
8/14/2019 S3IDF Social Merchant Bank Approach.april07
13/15 The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 13
SME development Areca plate and cup
manufacturing
S3IDF facilitates the business development, technology, financial and
market assistance to help create Areca product manufacturing SMEs.
Areca Leaf Products
Areca Plantations
8/14/2019 S3IDF Social Merchant Bank Approach.april07
14/15 The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 14
Telecom Services in Rural Areas
S3IDF enables local NGOs to access bank loan for the phone equipment
and facilitates leasing of the phone equipment to small shops.
8/14/2019 S3IDF Social Merchant Bank Approach.april07
15/15The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure 15
Contact usContact usSS33IDF US:IDF US:
The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable Infrastructure
Development Fund, Inc.Development Fund, Inc.The Carriage House, 5 Hastings SquareThe Carriage House, 5 Hastings Square
Cambridge, MA 02139 USACambridge, MA 02139 USATel: +1-617-576-0652 Email:Tel: +1-617-576-0652 Email: [email protected]@yahoo.com
SS33IDF India:IDF India:
The Small-Scale Sustainable InfrastructureThe Small-Scale Sustainable InfrastructureDevelopment FundDevelopment Fund
#800, 14th Cross, 1#800, 14th Cross, 1stst Phase J.P. NagarPhase J.P. Nagar
Bangalore 560078Bangalore 560078Karnataka, IndiaKarnataka, India
Tel: 080-65902558 Email:Tel: 080-65902558 Email: [email protected]@s3idf.org
For more information about S3IDF, visitFor more information about S3IDF, visit http://www.s3idf.orghttp://www.s3idf.org
mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.s3idf.org/http://www.s3idf.org/http://www.s3idf.org/mailto:[email protected]:[email protected]Top Related