Karnataka - Bangalore   

India Post, Janalakshmi launch financial scheme

BANGALORE: India Post and Janalakshmi Financial Services Private Limited have jointly launched a micro-finance credit linkage seeking financial inclusion of the urban poor. The scheme will be initially available in Karnataka Circle of India Post.

Spokesperson of Janalakshmi Dasarathy Ramaswami told The Hindu that the programme involves use of the Post Office Savings Bank account to encourage savings habit among Janalakshmi customers. The savings bank account will be the reference point for disbursement of loans and repayment.

“Besides this, the post office can also use the enormous reach it has developed in the urban areas through postmen and offer value-added services and informing micro finance clients with the latest account updates,” he said.

The credit limit depends on the requirements and the repayment capacity.

Most of the loans are in the range of Rs. 10,000 to Rs. 15,000 though there some loans up to Rs. 50,000. “Going by the demand for credit from the urban poor, it is possible to generate a large volume of credit, particularly among women in urban areas”.

The model allows the borrowers to have a repayment cycle of about one year and come back for second loan the following year for a larger amount and at a lower interest rate.

The women mainly use the money for starting small businesses in their neighbourhood including phone booths, organising sari sales in their localities, bangle shops and similar micro business ventures in the suburban areas, he said.

Field executives from Janalakshmi call on their residences at pre-appointed times and ensure guidance in financial matters and repayment on due dates. “Our total lending at this point of time is about Rs. 50 crore and about 100,000 families have been reached,” he added.

According to sources in India Post Karnataka Circle, “the circle has gained momentum in the last three years by forging significant partnerships with different organisations, resulting in a variety of activities. Mutual fund business, money transfers and cheque clearances were some of the financial activities taken up by the post office.”

The post office was only happy to start the financial inclusion of lakhs of small savings account holders in microfinance ventures, the sources added.

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