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Sanchetna's Presentation

  1. 1. Introduction to Sanchetna Financial Services Pvt. Ltd. September 2009 This Document is CONFIDENTIAL and its circulation and use are RESTRICTED
  2. 2. 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Clients 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  3. 3. Sanchetna Financial Services Private Limited (Sanchetna) is an NBFC started by young, dynamic, passionate & professionally qualified individuals having more than 18 years of microfinance experience. The mandate of the organization is to reach poor unbanked clients in some of the most poor states of India. The organisation was founded in June 2008 and the field operations started in October 2008 in Barabanki, Uttar Pradesh (UP). Sanchetna plans to move to other districts of UP and Uttarakhand in the next 3 years and to Bihar, Madhya Pradesh and Rajasthan in the next 5 years. It is looking to raise around Rs. 10 crores over the next 12 months.   Key Metrics as on 31 August 2009 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info Particulars Detail Date of formation 8 th June 2008 Areas of Operation Uttar Pradesh Portfolio outstanding Rs. 7982353 Number of active borrowers 1070 Number of branches 2 PAR (outstanding > 30 days) 0%
  4. 4. <ul><li>MISSION STATEMENT </li></ul><ul><li>“ To increase the productive capacity of the underserved people by providing sustainable financial and market led business services, in a socially responsible manner” </li></ul><ul><li>VISION STATEMENT </li></ul><ul><li>“ To be the most preferred MFI to the stakeholders by reaching 3 lakhs clients by the year 2013” </li></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6 Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  5. 5. <ul><li>Lokesh Kumar Singh- Managing Partner:   </li></ul><ul><li>Five years of professional experience in different fields. </li></ul><ul><li>Led operational expansion at SKS Microfinance Pvt. Ltd. (India’s largest NBFC-MFI) between 2004 and 2007 in 12 states including UP, MP, Rajasthan & Bihar </li></ul><ul><li>Built and managed a loan portfolio of over Rs. 200 crores with 99%+ repayment rate </li></ul><ul><li>Acquired 3.7 lakh clients in less than 21 months </li></ul><ul><li>Recruited and managed over 1200 staff from field assistants to senior management MBAs </li></ul><ul><li>Worked on a daily basis with Sitaram Rao, Praseeda Kuman & Vikram Akula </li></ul><ul><li>Led expansion at Nirmaan Bharati in UP between Dec ‘07 and June ’08 </li></ul><ul><li>Excellent skills and experience in product development, business & strategy planning, market research, internal audit, HR systems & process mapping </li></ul><ul><li>Postgraduate Diploma in Rural Management from IRMA, Anand 2004. </li></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  6. 6. <ul><li>Biswanath Swain – Manager Operations: </li></ul><ul><li>6 years of experience in microfinance operations in various geographies </li></ul><ul><li>Prior to Sanchetna, Biswanath worked as City Manager with Nirmaan Bharati (NB) (Nov ‘06 - June ’08) </li></ul><ul><li>Set up NB’s Varanasi operations acquiring 11,000 members, managing a loan portfolio of Rs. 8 crores & recruiting over 40 staff </li></ul><ul><li>Reporting to Mr. Mohammed Amin, CEO, Biswanath worked with Adhikar Microfinance (Bhubenshwar, Orissa) since inception in 2003 to 2005 </li></ul><ul><li>As Area Manager at Adhikar, helped acquire over 15,000 clients with loan portfolio of Rs. 2 crores & 99.9% repayment rate </li></ul><ul><li>Ashutosh Kumar Singh – Manager Information Technology: </li></ul><ul><li>9 years of experience in IT & microfinance in various geographies </li></ul><ul><li>Prior to Sanchetna, Ashutosh worked as Manager of IT at Bandhan between 2007 & 2008 reporting directly to Mr. Chandra Shekhar Ghosh </li></ul><ul><li>Implemented BRAC software across 40 branches & recruited over 40 IT personnel at Bandhan </li></ul><ul><li>Worked as Asst. Manager of IT at SKS between 2004 & 2007 during which branches grew from 17 to 900 </li></ul><ul><ul><li>Provided IT support for entire SKS operations across the country </li></ul></ul><ul><ul><li>Recruited 250 people and led a team of over 120 staff at the time of leaving </li></ul></ul><ul><ul><li>Developed and implemented enhancing accounting and performance monitoring software, which is still being used today </li></ul></ul><ul><ul><li>Sourced and implemented hardware in 160 branches and computerized Head Office comprising of 175 users </li></ul></ul><ul><ul><li>Worked on a daily basis with Sitaram Rao, Praseeda Kuman & Vikram Akula </li></ul></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  7. 7. <ul><li>Niraj Pareek – Manager Human Resources: </li></ul><ul><li>Prior to Sanchetna, Niraj worked with Nirmaan Bharati (NB) in UP for 5 months </li></ul><ul><li>Acquired 7000 clients, managed a loan portfolio of Rs. 7 crores & led a team of over 47 people while at NB </li></ul><ul><li>Worked as Recruitment Analyst at Accenture India in Bangalore, between 2005 & 2007, completing the company’s prestigious XLRI HR Academy Program </li></ul><ul><li>As part of the core recruitment team, recruited 2000 staff/month, totaling 24,000 in two years </li></ul><ul><li>Recruited for over 150 different skill sets </li></ul><ul><li>Graduate in Business Management from Bangalore University </li></ul><ul><li>Siddharth Misra – Manager Business Development </li></ul><ul><li>Prior to Sanchetna, Siddharth worked as Area Manager of Operations at SKS between 2007 & 2008 </li></ul><ul><li>Started SKS’ operations in eastern UP (Deoria district) with just 2 employees </li></ul><ul><li>Opened 5 branches in eastern UP within 5 months, acquiring 2700 clients and leading a team of around 30 field personnel </li></ul><ul><li>Managed 26 branches across 7 districts with over 90,000 clients & 200+ staff in the Marthwada region of Maharashtra (second largest region in SKS) </li></ul><ul><li>Maintained 100% repayment record in all branches under supervision </li></ul><ul><li>MBA in Agri-business from Pune </li></ul><ul><li>Sandeep Pandey – Head Accountant </li></ul><ul><li>Prior to Sanchetna, Siddharth worked with IFMR and Nirmaan Bharati </li></ul><ul><li>Solid relationships with bankers & funders </li></ul><ul><li>Qualified cost accountant </li></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  8. 8. <ul><li>Prabal K Sen – Professor - Economics, XLRI : Prof. Prabal Sen has served as a senior public sector banker for over two decades. He has offered consultancy services, among others, to the Ministry of Rural Development, Government of India. </li></ul><ul><li>Rajesh K Aithal – Assistant Professor - Marketing, IIML, Rajesh is Fellow-IRMA. Rajesh has close to four years of professional experience, in which three years are in sales and distribution and the remaining in teaching. </li></ul><ul><li>Mohammad Amin – CEO – Adhikar: He has vast experience in the field of development and has so far authored 4 books on Microfinance. Amin is also currently serving as Executive board member of Sanhati (Network of NGO) in Orissa. </li></ul><ul><li>Deepak Amin, co-founder & CEO, Covelix : Covelix is a Seattle based software consulting company. Prior to Covelix, Deepak also worked at Microsoft for many years as at Microsoft, Redmond-USA. Deepak is also an advisor to Grameen Foundation. </li></ul><ul><li>Sachi Shenoy, Innovations Manager – Unitus: - Sachi holds a B.A. in Economics and an M.B.A. in Finance and Entrepreneurship from the University of Chicago. Sachi has also worked at New York-based CDVCA, JP Morgan Chase, and Price Waterhouse LLP. </li></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  9. 9. <ul><li>Manoj Sharma : Deputy Program Director Microsave India - Manoj is a development finance and SME specialist with more than 15 years of experience, and coordinates the India operations. During his time at SIDBI, Manoj was part of the SME financing team which negotiated a USD 225 million assistance package </li></ul><ul><li>Krishnan Rajaram - Krishnan has over 8 years of experience in the IT and financial services industry focused on institution building, change management and managing business operations. Krishnan is a Chartered Accountant, Certified Financial Planner and an alumnus of the Indian Institute of Management, Bangalore. He currently lives in London. </li></ul><ul><li>Krishna Tiwary – Lead Partner in Krishna Anurag and Company firm based in NOIDA. Providing advisory services to ICICI Bank, Power-Grid Corporation of India, and Sphere Partners. </li></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  10. 10. <ul><li>Western & Central UP </li></ul><ul><li>Population:4,49,87,00 </li></ul><ul><li>Maximum of 3 other MFIs operating in these areas </li></ul>Source: Sa-Dhan Microfinance Report 2008 Microfinance Outreach in Uttar Pradesh Clients outreach 533,041 Portfolio outstanding Rs. 347 crore Number of districts served 36 Number of poorest districts 15 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  11. 11. <ul><li>UP, Uttarakhand, Rajasthan, Bihar & MP are the most populous states in India </li></ul><ul><li>They are also some of the poorest – almost 45% of India’s poor are in these states </li></ul><ul><li>In spite of the above facts, microfinance penetration in these states is amongst the lowest in India </li></ul>Source: Sa-Dhan Microfinance Report 2008 State Total Microfinance Clients Share of state to total clients State Population % share of population Number of Poor (2004-05) % share of poor Microfinance Penetration Index Microfinance Poverty Penetration Index Uttar Pradesh 3,613,118 6.10 180,990,000 16.43 59,003,000 19.56 0.37 0.31 Uttarakhand 337,625 0.60 9,123,000 0.83 3,596,000 1.19 0.69 0.48 Rajasthan 2,335,369 3.90 61,525,000 5.59 13,489,000 4.47 0.70 0.88 Bihar 1,455,981 2.50 89,776,000 8.15 36,915,000 12.24 0.30 0.20 Madhya Pradesh 1,312,668 2.20 65,605,000 5.96 24,968,000 8.28 0.37 0.27 Total 15.30 36.96 45.74 Comparison                 Andhra Pradesh 13,061,436 22.00 80,147,000 7.28 12,610,000 4.18 3.03 5.27 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  12. 12. <ul><li>Given the aforesaid statistics, Sanchetna’s expansion strategy is as follows: </li></ul><ul><li>Expansion in UP </li></ul>Sanchetna’s footprint Sanchetna’s footprint June 2010 Sanchetna’s footprint Sanchetna’s footprint June 2011 June 2012 June 2009 Expansion to other states Districts in UP Competitors Sa-Dhan classification Barabanki Margadarshak, SKS, PANI Poorest District Sitapur None Poorest District with no MFI Sahjahanpur None No MFI district Bareilly SKS District with MFI presence 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  13. 13. <ul><li>Married females between 18 & 55 years old </li></ul><ul><li>Rural and semi urban areas </li></ul><ul><li>Clients must have 1-3 members per household </li></ul><ul><li>Economically active but belong to low income category </li></ul><ul><li>Most clients operate businesses with low stock volumes </li></ul><ul><li>Engage in multiple livelihood activities, each with differing seasonal & market fluctuations </li></ul>1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  14. 14. Loan Purpose Design Samridhi Group based loan for providing working capital Rs. 4,000 – 12,000 @ 15% flat 46 weeks repayment Increasing by Rs. 2000 every loan cycle Suvidha To meet additional fund requirements after successful repayment for 23 weeks Upto Rs 6,000 Increasing by Rs 1,000 every loan cycle Individual After minimum two loan cycles to individuals for enterprise development Rs. 30,000 and above Monthly repayment @ 24% per annum Loan cover insurance Cover the clients against death for the loan amount @ Rs. 2.85/1000 Rs. Among the best deals in the microfinance space 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  15. 15. SANCHETNA Integrated Microfinance Financial and Non-financial services OTHER MFIs IN THE REGION Minimalist Microfinance Missing Piece – Credit Financial Intermediation Working Capital Asset Purchase Social Intermediation Financial Literacy Leadership Co-operation Business Development Marketing Production Training Competitor Analysis Preparatory BDS Setting of Business Activity Capacity Building Support 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  16. 16. 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  17. 18. <ul><li>Projections </li></ul>Current performance Particulars Progress Till 31 st August ’09 Active Clients 1070 Disbursement 119.62 Lacs Outstanding 79.82 Lacs Manpower 20 Repayment rate 100% Year 31/03/09 31/03/10 31/03/11 31/03/12 Members 490 10,780 53,085 151,695 Disbursement 3,984,261 109,111,194 704,722,190 2,358,625,081 Branches 1 5 15 32 Income Statement         Financial Income 305,948 9,902,458 80,909,746 310,463,332 Other Income 964,553 462,050 928,878 3,104,633 Total Income 1,270,501 10,364,508 81,838,624 313,567,965           Financial Cost 0 4,502,265 27,047,822 103,104,016 Loan Loss Provision 39,843 1,091,112 7,047,222 23,586,251 Operating Expenses 1,626,761 4,659,239 12,889,878 28,576,117 Depreciation 36,000 102,000 279,000 610,000 Total Expenses 1,702,603 10,354,616 47,263,922 155,876,384 Taxes 0 0 11,534,121 52,605,912 Surplus -432,102 9,892 34,574,702 157,691,582 Retained Earnings -432,102 9,892 27,047,822 103,104,016 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  18. 19. 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  19. 20. 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  20. 21. 1. Executive Summary 2. Mission & Vision 3. Management Team 4. Board 5. The Market 6. Expansion Strategy 7. The Client 8. Loan Product 9. Systems & Processes 10. Current & Projected Info
  21. 22. <ul><li>Indiamicrofinance.com is an online platform for the microfinance community initiated by Sanchetna </li></ul><ul><li>Financial Services Pvt. Ltd. with the goal of improving accessibility and quality of financial services for the </li></ul><ul><li>poor through rigorous research, knowledge dissemination and evidence-based policy for MFIs. </li></ul><ul><li>Within a short period of its launch it has become India’s No 1 Microfinance News Portal and is among the </li></ul><ul><li>top 5 Microfinance News Websites of the world (by traffic).The website is focused on the microfinance </li></ul><ul><li>sector in India , the people in the microfinance sector and related industry twists and trends that affect all </li></ul><ul><li>of us involved. Emerging topics include entrepreneurship and social businesses. </li></ul><ul><li>It also hosts a fast growing jobs and events board which focuses on opportunities in the microfinance </li></ul><ul><li>sector. </li></ul><ul><li>Traffic – 80 % of our visitors are from India and 15 % from the US and Europe. </li></ul><ul><li>Other Data </li></ul><ul><li>Monthly Unique Visits 8,000+ </li></ul><ul><li>Monthly Page Views 20,000+ </li></ul><ul><li>Monthly Growth 5-10% </li></ul><ul><li>RSS Subscribers 30+ </li></ul><ul><li>Email Subscribers 300 + </li></ul>

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