Sankul Capital Services Private Limited

In their own words

We use a non brick and mortar model to provide doorstep delivery of banking services to the remotest of villages and semi urban areas adjoining them. Our clients are from the lowest economic strata who are unable to access mainstream banking services for a variety of reasons. Typically, those inhabiting the bottom of the pyramid are considered credit risk and despite Government intention to serve them by laying targets for the Public Sector Banks (PSBs) under Priority Sector, the targets remain largely unmet. There are both demand side constraints and supply side constraints. The poor are uneducated, require close handholding and the transaction ticket is too small to make it viable for the mainstream banks to provide them service. The banks, on the other hand, have not invested sufficiently in building infrastructure, technology and trained staff in the rural areas. They also have an inherent mistrust while lending to poor. We work towards bridging the gap between the poor and the mainstream banking channels. We are committed to establish the bankability of the poor. We organize the women into Self Help Groups, train them in “Panch Sutra” of regular meeting, regular saving, inter-loaning, regular repayment and maintaining impeccable record of transactions. Once mobilized and trained we ensure credit flow to them and based on their absorptive capacity the credit limit is enhanced gradually. Continuous and sustained capacity building of the groups is an inherent part of our program. This includes financial literacy, bank account, savings, micro-credit planning, insurance, remittance, pension and counselling on financial services besides book keeping, visioning and future planning. We use high end technology to reduce cost of transaction on one side and close oversight over the Groups to ensure timely repayment, on the other. We have a Service Point and a Village representative in each village and use handheld equipment and state of the art software for keeping track of all banking transactions. Our field staff is completely local and we create local employment while giving an essential service at optimum cost. As per RBI report, there are only 70K rural bank branches for 650K villages. Consequently, there is low penetration of financial products such as insurance (3.71%), savings and pension plan; massive credit gap (more than 30%). Providing these services for the mainstream bank is unviable due to low-ticket transactions. Further, neither the banks nor the client base has adopted technology and continue to rely on in-person transactions which overloads the banking infrastructure and resultant service deficiency. Clients have to travel huge distances in an area lacking basic transport facilities. The branches are cramped and have skeletal staff. Decentralized banking alone can solve the problems of rural/semi urban banking. Government of India has recognized that Self Help Groups are the best medium to bring the poor under the ecosystem to provide them essential services using the trinity of JAM, Jandhan Yojana, Adhar Card and Mobile. National Rural Livelihood Mission(NRLM) has mobilised more than 70 million Self Help Groups and linked little more than 37.3 million SHGs to the banks. As is evident there is a huge gap in credit flow to the poor and the core of NRLM financial inclusion and investment strategy of “making poor the preferred clients of the banking system and mobilizing bank credit” has not been met. Sankul Capital Services steps in to bridge the gap. We have established a proof concept by credit linking over 150 Self Help Groups with an amount exceeding 1.50 crores in a short period of 6 weeks and ensured a nil overdue repayment record. Sankul Capital Services works for Social mobilization, financial inclusion and women empowerment.

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