Micro-Enterprise Development Strategy and Support Mechanisms

New Delhi: 22nd June 2011

Kudumbashree, Kerala

Kudumbashree

Poverty Eradication Mission of Government of Kerala

Started in 1998 3-tier Community Organization structure

embedded in local self governments Neighbourhood groups Area Development Society (Ward level) Community Development Society (LSG level)

State and District Missions to support and facilitate functioning of CBO

Kudumbashree - Coverage

LSGs – Total - 1043; Rural - 978 CDS – Total - 1061; Rural - 977 ADS – Total - 17,956; Rural - 16012 NHG – Total – 2.07 lakh; Rural – 1.86 lakh Families–Total – 38.57 lakh; Rural – 34.36 lakh

(~ 50% of the families in Kerala)

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Structural flows• CDS sub committees

• Micro finance• Micro enterprises• NREGS and collective farming• Social development• Infrastructure

• ADS• Members given corresponding responsibilities

• NHG• Income generation activity volunteer• Health and education volunteer• Infrastructure volunteer

Kudumbashree - Activities

Micro Finance Thrift & Credit Bank Linkage, Interest Subsidy, Matching Grant Financial Literarcy Audit & Account

• Collective Farming by women groups• Women collectives for food security• Cultivation of land on lease by forming joint liability groups of

women farmers• From Unskilled labourer to producer - cultivator• Convergence of local government agricultural support

interventions• Scientific mode of cultivation and better know how of scientific

cultivation practices• Have a say on the produce- price, what to produce, when to

produce, how to produce• 25000 hectares of land under cultivation through

Kudumbashree intervention

Kudumbashree - Activities

Kudumbashree - Activities

NREGSADS (Ward-level) functioning as mate

Involvement in registration, job-card issue

Social Audit

Integration with agricultural interventions by Panchayat and Krishi Bhavan.

Eg: Perambra Grama Panchayat – conversion of 140 acres of fallow land.

Kudumbashree - Activities

Micro Enterprises Individual & Group enterprises Special enterprises Collectives/Consortia

Samagra – Value-chain based enterprise model

One activity on a large scale targeting poor women with support across the value chain

• Comprehensive development of either an agricultural produce or an industrial product or a traditional job

• An all inclusive programme encompassing all the components from production to marketing

• local governments facilitated to develop projects and converge resources

• Community network support in implementation• Coordinated negotiation for bank finance

Kudumbashree - Activities

Samagra- Collectives

• Pineapple project of Ernakulam district

• Joint project of LSGs, Kudumbashree and Private Company

• 3115 women as cultivators• 1250 ha under lease land farming• Technical facilitation for quality produce

• Demonstration farms• Exposure visits• Trainings – follow up visits• Integrated nutrient and pest management practices• Value added products

• Market tie up

Samagra – Nendran Banana

Banana Cultivation Project in Trivandrum

• Kudumbashree , 3 tier Panchayath and private partner• Project worth Rs 40.60 crores - 58 Panchayaths -3 phases.• 2400 ha - 30000 women farmers• Phase I - 1780 ha under Nendran Banana - 13000 farmers • Dist Panchayat -Set up Bio-control lab, tissue culture lab and

soil testing lab. • Adopted various scientific cultivation practices like IPM, INM

etc• CDS role in bank linkage, provisioning of master trainers• Panchayat support for land identification, coordination and

monitoring

Samagra- CollectivesOutcome

• Assured market• Controlling Costs of production• Technical and technological know-how- theory into practice• Scientific cultivation practices• Support of the Technical institutes• Good bargaining power• Transformation from unskilled to skilled labourers/ entrepreneurs• Role clarity• Specialization• Value chain• Support of the community

Enterprise-Convergence

Nedumpana Panchayat•Panchayat initiative for garment cluster

•Convergence effected

•Industries department women development fund for machineries

•Panchayat fund for infrastructure

•Kudumbashree fund for management support, training

•CDS mobilisation of beneficiaries, coordination

Kudumbashree - Activities

Marketing Monthly-Weekly-Daily markets at LSG level Festival fairs; exhibitions Home Shop

Marketing CollectivesCommunity Marketing Network – Home shops

• Institutionalization of local markets for producers

• Local Production- local marketing- local consumption

• Opens new doors for marketing involving poor women of the locality

• Production units linked to local network through home shops- women who take orders and deliver products in the neighbourhood (ward as unit)

• professional management team to oversee logistics of production and distribution

• Localised branding and quality standardisation

• Sales on predetermined commission basis

LSGs and local markets

• Organisation of monthly and weekly markets for sale of kudumbashree products

• Special fairs during festivals, exhibitions

• LSG infrastructure, promotion and supervision

• Link up with cultural programmes for visibility

• Vegetable stalls set up by panchayats for local sale of produce

Market -Converegence

We started with the monthly market, and then went on to weekly markets for the products from our panchayat. The panchayat provided us with a pick up truck and shopping lot and now we run daily markets

CDS Nedumkandam

Kudumbashree - Activities

Social DevelopmentDestitute RehabilitationSpecial schools for mentally challenged childrenBalasabha – Children's forumSpecial Projects for ST communities

Kudumbashree - Activities

Women's Empowerment Gender Self-Learning Programme

CBO Strengthening Bye-laws & Election rules Support for convergence of resources Organization management support Internal accountability & collective responsibility

Capacity Building

Most critical activity in the Kudumbashree system Multiple areas – livelihoods, social development,

gender, organizational development Multiple stakehoders – NHG members, CBO

leadership, LSG leadership, Officials, Resource Persons

Multiple approaches – Institutional training, in-house professional training groups, CRP system, Individual experts

Community-based CB – Resources Resource Persons at various levels - volunteers

Micro Finance – 26,000 persons Social Development – 3,500 persons Gender – 52,000 persons

Training Enterprises 20 units conducting multi-disciplinary training 43 KAASS units of 356 trained accountant-auditors for book-

keeping MEC

300 persons, in 29 MEC groups Master Trainer micro-enterprises to train/mentor new units Master Farmers for collective farming (MKSP)

From individual to collectives

Collectivization of trainers

– Started off with individual resource persons– Gradually formed into groups– Enterprise form

Collectivization of enterprises

– Bringing together of scattered enterprises in the same sector (garments, IT etc.)

– Formation of Consortium at State level (member owned and controlled)

Collectivization of MEC

– Groups of MEC at District/Sub-district level

Community-based Enterprise Support System

The Kudumbashree Experience

Micro Enterprises in Kudumbashree

~ 15,000 enterprise units; ~60,000 members More than 100 different types of enterprises Production to Consumption interventions Consortia

Garment Consortium (Kadambari) Nutrimix (nutrition supplement) Consortium

(Amrutham) Consortium of IT units (Unnati)

Marketing interventions

ME Sector - Needs Appropriate orientation and training for new

entrepreneurs Timely availability of managerial and technical

expert support Identification of business opportunities Preparation of bankable business plans Ties for backward-forward linkages (technology,

market, finance) Specialized training

Strengthening CBO network to deal with economic/business issues effectively

Building support systems

Business Management expertise available in the market Expensive, not always available Difficulties in understanding context of pro-poor

businesses Alternative - develop bare-foot business

management consultants Micro Enterprise Consultant - MEC

MEC System

Started in 2004 Strengthened from 2009 onwards ~300 MEC active at present 29 MEC groups formed in 2011

MEC

Young men and women from families of NHG members

Identified by CDS, selected by District Mission Orientation training by EDII, Ahmedabad Specialized business management training for

select MEC (CREAM Training) Business management training for other MEC

by Master Trainer MEC (TEAM Training)

Services provided by MEC For establishing new enterprises

Support CDS in identification of entrepreneurs Preparation of business plans Support to entrepreneurs for bank liaison, machinery purchase,

market linkages, product quality assurance etc.

Support for existing enterprises Support for licensing, product diversification, market expansion,

book-keeping, financial statements etc.

Training New entrepreneur orientation & training Performance improvement training for existing entrepreneurs

Services provided by MEC Support to CBO Structure

Identification of entrepreneurs, business opportunities Preparation of enterprise inventories Conduct of monthly/weekly markets, fairs Co-ordination with different departments/agencies Preparation of GP level Livelihood Development Plan

Support to Kudumbashree Mission Conduct of surveys and studies Conduct of training programmes Feedback on enterprise issues

Remuneration for MEC

Paid by entrepreneurs 0.5% to 1% of project cost – for business plan

preparation Rs.500 for business counselling Rs.250 for book-keeping

Paid by Kudumbashree Mission Rs.350 per day faculty fees for training Rs.250 per month per unit for follow up visits to new

enterprises MEC groups earn revenue by providing training

services to other agencies/departments

Monitoring of MEC mechanism

At CDS level Regular review of working of MEC support Bi-annual report of services provided by MEC group

to District Mission At District Mission level

Monthly report by MEC group Bi-monthly review meeting at District level Bi-annual joint review of CDS and District Mission

Detailed guidelines issued by State Mission

Thank you!