Basix
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BASIX is a livelihood promotion institution established in 1996 that provides integrated microfinance and technical assistance services to rural populations in India. It operates through subsidiaries that focus on microfinance, technical services, and banking. BASIX aims to generate sustainable livelihoods for different segments of the rural economy, including subsistence workers, micro-enterprises, and small agro-enterprises, through tailored financial products and services combined with training and support. After over a decade of operations, BASIX has lent over Rs. 460 million to more than 31,000 clients across six Indian states.
Basix
- 1. Livelihood Initiatives by BASIX
- 2. BASIX BASIX, a new generation livelihood promotion institution was set up in 1996 by three promoters, Mr Vijay Mahajan, Ms Bharti Gupta Ramola & Mr Deep Joshi. It provides technical assistance integrated with micro-finance services & is operating in six states of india. It has lent more than Rs 460 million & given 31,000 loans. It is the first NBFC in the country to deal with micro-finance activities with professional management.
- 3. Why BASIX idea emanated There was a need to generate a large number of sustainable livelihoods. Technical assistance, support & financial services are needed for sustainable livelihood. Financial services were highly underserved. For large scale rural employment wage employment is also needed in addition to self employment.
- 4. Corporate Structure of BASIX Holding company is Bhartiya Samruddhi Investments & Consulting Services Ltd Three subsidiaries: a) Bharatiya Samruddhi Finance Ltd b) Indian Grameen Services c) Krishna Bhima Samruddhi Local Area Bank
- 5. Basix Clientele Different segments in rural economy need different mode of operation. There are three customer segments in rural economy:- 1. Small enterprises/commercial farmers 2. Micro enterprises/small farmers 3. Subsistence workers/marginal farmers
- 6. Subsistence workers These are managed through Self Help Groups. It includes marginal farmers in semi arid areas. From allied sector it has backyard poultry rearers and livestock rearers. It also constitutes cottage units and artisans from non-farm sector.
- 7. Micro-Enterprises They are managed through Joint Liability Groups or through on-lenders. They include small farmers producing cash crops or marketable surplus of food crops. Small poultry and dairy farmers are also the part of the segment. Non-farm activities employing two to five workers.
- 8. Small and Agro-Enterprises Direct loans on collaterals are given to this segment. They include plantation farmers like orchards, floriculture or aqua culture. Commercial poultry and dairy farmers form the allied sector of this segment. Enterprises with 6 to 10 workers like stone slab- polishing unit also come under this segment.
- 9. Overview of operations Two profit companies for financial services and one non-profit making company.
- 10. Financial Services The organization has extended 31000 ultimate loans amounting to Rs 468 million. Loan products are divided into three broad categories:- 1. Farm loans 2. Non-farm loans 3. General purpose loans
- 11. The loans also be classified as:- 1. Direct loans: Extended directly to rural producers by BASIX. They are generally less than Rs 50,000 2. Indirect loans: Extended through other trade intermediaries. Commission agents are employed to extend credit to rural producers. The organization is working on developing some products for weekly markets like haats that operate in rural market.
- 12. Non financial services Offered by Indian Grameen Service(IGS) Exploring livelihood opportunities Extending technical assistence and support services Human resource support Support to micro finance institute
- 13. Exploration of livelihood opportunities In Bihar, Maharashtra and Rajasthan IGS undertook sub sector studies of fishery,salt production and pulses. In Madhya Pradesh Promote Joint ventures Financial services to poor houshold:Chitti
- 14. Technical assistance and Support Servives Dry land Agricultural Productivity Enhancement Programme (DLAPEP) Micro drip irrigation International Development Enterprises- low cost technology UNDP- organizing women Saubhagya Seeds Pvt. Ltd- distribution of equipments Training in irrigation & tube well management Improving productivity of groundnut
- 15. Watershed Management Development of financial product IGS looked for new crops( variety of watermelon, papprika) Increase productivity of crops such as groundnut and cotton
- 16. SHG Quality Improvement Program (SHGQIP) Capacity building in book keeping and accounting Promoting SHGs Rural Infrastructure Revival Program (RIR) Inter Borrower Expertise Exchange Program(IBEX) Risk Mitigation
- 17. Other Functions Institutional Development Support to other MFIs Research and Consultancy Financial Performance of BASIX Operating costs much lower than others in the industry (15.8% against 21.9%) Return on assets (1.0% against 1.3%)
- 19. ELABORATE SELECTION PROCEDURE (PSYCHOMETRIC TEST) PERIODIC EMPLOYEE ASSESSMENT REMUNERATION SYSTEM EMPLOYEE TRAINING:- PEER TRAINING ON-THE-JOB TRAINING VISITS TO OTHER UNITS ANNUAL STRATEGIC PLANNING SESSIONS
- 21. EXTERNAL AGENCIES CONDUCT THE ANNUAL „CUSTOMER SATISFACTION AUDIT‟ HIGHLIGHTS OF THE AUDIT ARE:- TWO-THIRDS OF CUSTOMERS ARE POOR INDIRECT LOANS CUSTOMERS RATE BASIX HIGHER AS IT LENDS CREDIT FOR PURPOSES NOT COVERED BY OTHERS “APPROACHABLILTY, FRIENDLINESS OF PROCEDURES AND TIMELINESS OF LOANS” FLEXIBILITY IN DISBURSEMENT AND RECOVERY
- 22. AREAS OF CONCERN:- HIGH RATE OF INTEREST HIGHER TRANSACTION COST LEVEL OF AWARENESS ABOUT BASIX LOW INTERMEDIARIES CHARGING HIGHER RATE OF INTEREST THAN SPECIFIED
- 23. CONCLUSION UNIQUE WAY TO SERVE THE NEEDS OF CUSTOMERS THROUGH A MIXTURE OF CHANNELS. LENDING METHODOLOGIES ARE AIMED AT REACHING THE POOR AT REASONABLE AND MARKETED RELATED PRICES FOCUS ON MISSION OF SUSTAINABILITY AND SERVING THE POOR. SUCCESS DEPENDS LARGELY ON ABILITY TO ATTRACT LOWER COST FUNDS.