COCHIN – Five hours north of Kerala’s political capital of Trivandrum, passing through mirrored chessboards of rice fields and palm-lined canals criss-crossing the terrain, is Kerala’s economic and cultural capital.
Cochin has been a hub of trade for centuries, linking the Greeks and Romans to the Chinese and later the Portuguese, Dutch, and British all hoisted their flags atop their spice ships in its serene harbor.
The Muthoot family and family of companies has been the backbone of financing Kerala’s economic and infrastructural development, dating back to when the region was known as the Kingdom of Travancore under the British Raj.
I sat down with Muthoot FinCorp Executive Director, Thomas Muthoot, and COO Sadaf Sayeed to discuss their forays into the microfinance space, their current relationship with ACCION delivering Dialogue on Business to their clients, and the direction they envision for our partnership.
Thomas saw two avenues and both have been met with initial successes. First, (I concluded an earlier post alluding to this avenue) since Muthoot cannot hold savings for their clients, they have found another unique way to generate savings for asset accumulation.
Enter the gold coin. They have devised a program where the borrower would pay a little extra each week in addition to her loan repayment, and at the end of the 52-week cycle, she will be issued 1g of gold.
By the end of the year Muthoot and ACCION will finalize relationships, buy-back agreements, and other market linkages with NABARD (India’s national Development Bank) and ROPE as well as review the anticipated Dialogue impact assessment.
Nonetheless, Thomas and Sadaf are very pleased with their partnership with ACCION for reasons beyond bringing Sthreejyoti to their clients and the ROPE linkage and envision their relationship becoming more meaningful and focused down the road;
for example, “Modifying the modules or delivery methodologies, Accion should be there. Or if we are targeting a new set of clients, artisans, a specific cluster of entrepreneurs, in those situations we will use ACCION’s expertise.”
We have trained about 8000 women and it’s our hope that 500 would become successful entrepreneurs.” Sadaf continues, “A real entrepreneur means she is independent and can manage her business on her own.
On that note I presented seven client stories, including some of my favorites like Munni’s beedie business , Usha’s hopeful expectation for a loan to scale up her chapati enterprise, and the sudsy Trivandrum -tragedy .
Thomas suggested the ladies in Trivandrum start a laundry service. His recommendation brilliantly summed up the type of creative and entrepreneurial thinking that Muthoot wants to foster in their clients: to work with what they have and Muhtoot will provide counsel along the way.