India, with 1.13 billion inhabitants, has about 830 million people living on less than $2 per day and 270 million on less than $1 per day (at PPP, according to the World Bank). Despite the high growth of the Indian economy, little is changing for the poorest. Tamil Nadu is one of the more prosperous states in the country and yet 21% of its 62 million people live below the poverty line and many of them live in the rural areas where self-employment is often the only way towards a better future.
Hand in Hand helps poor women and their families in 17 districts of Tamil Nadu enhance their livelihoods by investing in productive assets and creating microenterprises. Since 2004, Hand in Hand has organized more than 700,000 women into self-help groups, trained them in financial literacy and entrepreneurship, provided them with microcredit, and assisted them in setting up and sustaining microenterprises. The families invest in livestock, irrigation, bakeries, citizens’ centers (IT-kiosks), and many other farm and non-farm activities.
The program that Voxtra supports
Voxtra supports Hand in Hand over four years to expand their program into three more districts of Tamil Nadu with a combined population of 4.5 million people. The target of the program is to organize 52,000 women in self-help groups and support them in setting up 32,000 family-based enterprises, enabling each family to increase its income by an average of an estimated $200 per year. Because of the continued support from Hand in Hand, the added income is again invested in more productive assets, which increases the income of the families further. In addition, Hand in Hand will contribute to establishing 550 small enterprises, including a range of “citizens’ centers”. The citizens’ centers will offer services such as computer education, access to government schemes, and other ICT related services to one million people. The program was launched in November 2008. Voxtra’s share of the program is 68%.
Why Voxtra selected this program
- The direct socio-economic benefit of Voxtra’s philanthropic investment, consisting mainly of increased incomes through family-based enterprises, is conservatively estimated at 9x the investment (27x when the benefits are valued at PPP). There are several other social benefits such as women empowerment, pro-poor political influence, computer literacy, access to information etc that have not been quantified.
- The program reaches the poor: Hand in Hand focuses on the rural areas of Tamil Nadu and uses its Participatory Rural Appraisal method to map the most disadvantaged people in the villages.
- Hand in Hand is an excellent grassroots organization with decentralized operations, well-developed systems for financial management and operations monitoring, and a results-oriented and pragmatic approach. The organization has exhibited an impressive ability to pilot and rapidly scale up successful projects. Hand in Hand is also a role-model in creating partnerships with various stakeholders, such as local and national governments, civil society organizations and the private sector.
Progress of the program
As per March 2013, Hand in Hand has established 4,049 self-help groups with over 53,000 members under Voxtra’s grant. More than 25,000 of these women have taken loans and invested in family-based enterprises. A randomized controlled trial conducted by the Centre for Microfinance at the Institute of Finance and Management Research (IFMR) in Chennai is underway to rigorously document the development impact of the program.