IFMR Holdings taps technology to drive financial inclusion

IFMR Holdings, a leading financial inclusion platform in the country is leveraging technology to deepen its presence in the remote rural areas of Tamil Nadu, Uttarakhand and Odisha.

Through its downstream company, Kshetriya Grameen Finance Services (KGFS) — a pioneer in developing focused financial products for the rural poor, IFMR is deploying cloud-based technology in remote rural areas.

"High level of automation for data capture and analysis, and standardised processes at the branch enable a three-member branch staff recruited mostly from within the remote rural geography to serve over 2,000 households with multiple financial services. The KGFS model leverages technology by using the best hardware and connectivity solutions available in the market and software such as a Loan Management System (LMS) and a proprietary Customer Management System (CMS). The functioning of the entire set up therefore is online, real-time, co-ordination and monitoring becomes automated and effective. Each KGFS has a high degree of automation via centralized technology back-ends coupled with standard processes creating outreach to otherwise un-banked areas", said Sucharita Mukherjee, chief executive officer, IFMR Holdings.

With a network of 240 branches in remote villages in the states of Tamil Nadu (Thanjavur and Thiruvarur districts), Odisha (Ganjam district) and Uttarakhand (Tehri district), KGFS impacts over 0.6 million individuals in these areas. Each of these branches serves households and small businesses in a radius of five to eight km from the branch, delivering financial products and services that are based on the needs and goals of each household.

"At least one out of every two households in remote rural areas that KGFS operates in, benefit from insurance, savings and timely access to loans. About 70 per cent of the customers have taken more than one financial product from IFMR. Women are active money managers in the communities that KGFS works with. For example in Odisha, more than 27,000 women in this group have participated in joint liability group loans, bought insurance cover and availed of micro enterprise loans from Dhanei KGFS. Today, there are about 5,387 women entrepreneurs whose budding businesses ranges from tailoring, grocery, tea stalls to dairy and micro enterprises. On an average they support a family of four with their income", she said.

As on May 2016, the average loan outstanding per person is Rs 14,500 while the total loan portfolio has reached Rs 430 crore.

"We offer multiple loan products with an average interest rate of 24 per cent. The tenure varies between one and two years and repayment terms can be weekly or monthly based on the customer's preference. Most of our customers opt for the monthly repayment plan," Mukherjee said.

Apart from growing its loan portfolio, IFMR has issued about 1.5 million insurance policies including personal accident insurance and life insurance. It is also offering a savings bank account to the customers, where Axis Bank is the banking partner.

IFMR through KGFS is offering a suite of loan products like salary loan, crop loan, JLG (joint liability group) loan, education loan, personal loan and livestock loan.