The UK Government’s Department for International Development (DFID) has launched its first private sector development programme named ‘Samridhi‘ in India in partnership with the Small Industries Development Bank of India (SIDBI) – the apex Development Bank in the country.
Samridhi, meaning prosperity aims to promote the pro-poor responsible and sustainable private investment in poorer states in India and to help poor people get access to financial services to improve their income and quality of life.
The programme represents a UK commitment of £65 million (Rs 520 crores) between 2012 and 2019. and will contribute to Indian central and state government priorities of promoting inclusive growth, including through financial inclusion and investment in small and medium enterprises.
Launching the Programme, Mr. Andrew Mitchell, British International Development Minister said, “I believe that entrepreneurs with innovative and creative ideas, who take risks and work hard to produce a product or a service, especially those which can help poorer segments of society, deserve to be encouraged and supported”. “Using returnable capital rather than grants, they will be able to start and expand businesses and pay money back so that it can be used to deliver another cycle of benefits. I am proud that DFID is able to provide such support to help start and grow businesses like the ones showcased earlier this evening.”
Speaking on the launch of the new project at the British Council, Mr Sushil Muhnot, Chairman, SIDBI, observed that there is a welcome shift towards impact investments by development agencies and Samridhi has the potential to become a model for such investment programmes in future.
He mentioned that SIDBI had helped a network of Micro Finance Institutions in the country under National Micro Finance Support Programme earlier supported by DFID, among other institutions, reaching 6.6 million poor clients and the present programme would enable us to replicate the success in identified Samridhi states. He hoped that the programme would go a long way in reducing poverty in the identified states.
Samridhi will extend the reach of financial services in underserved areas of Bihar, Madhya Pradesh, Orissa and Uttar Pradesh. Samridhi will also create an Impact Investment Fund for India’s low income states viz. West Bengal, Rajasthan, Jharkhand and Chattisgarh besides above 4 States, to provide patient capital to enterprises that deliver benefits to poor people ( as consumers, producers or employees). This will directly benefit 12 million poor people, of which three-fourth are women, to raise their incomes, set up or grow businesses, save for family needs like their children’s education, and cope with unforeseen shocks like a death in the family.
The launch brought together over 200 distinguished representatives from the Government of India, private sector, social enterprises, academia, MFIs, non-governmental organisations and multilateral partners. The launch also showcased private sector initiatives that are delivering development results, for example, Waterlife, D’lite and B-ABLE.