Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Joint Initial Assessment Report

Submitted to

Janmitram Kalyan Samiti (JKS) Plot No. 74, Kelo Vihar Raigarh (Chhattisgarh) Ph. 07762-220083 E-Mail: Janmitram@yahoo.co.in Website: www.janmitram.org Submitted by

BASIX
Equity for Equity

Bhartiya Samrudhhi Investment and Consulting Services, Ltd.

8-2-596, C-2 to C-5 IInd Floor, Ascent towers Opp. Karvey house Road No. 10 Banjara hills, Hyderabad-500034, Andhra Pradesh, India,

www.basixindia.com July 2010

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Acknowledgement
We acknowledge with thanks, all persons who spent their precious time and energy in providing us with valuable information and supported us in bringing out each and every aspect of this report. We convey our sincere thanks in particular to Dr. Mukesh Giri Goswami (CEO cum President), Mr. Manish Singh (Secretary) Mr. Ravi Kant meena (Joint secretary) Ramakant padhi (Associate Manager) Rakesh kumar pandey (Asst. Manager) and Mrs. Uttarawali (Field staff) for their support and co-ordination, throughout this process. Our sincere thanks are due to all the unit staff for accompanying us to the field and helping us understand the field realities and JKS operational area in a better way. Last but not the least; our thanks are due to all the SHGs and other members who were present and with whom we interacted during our field visit, whose experience helped us a lot in preparing this report. Its our privilege to thank to all, who are involved in the JIA study and in the preparation of this report either directly or indirectly.

BASIX Team Date: 10/07/2010

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Index
Summary of Assessment.05 Key information of organization ..07 Executive Summary................................................................................08 1. Introduction 2. 3.
1.1. Expected Outcome of the diagnostic study..........................................................10 Methodology............................................................................................................10 2.1. Study Framework..10 2.2. Process Followed..................................................................................................10 Assessment ..............................................................................................................13 3.1. Organization Design.............................................................................................13 3.1.1. Mission.......................................................................................................13 3.1.2. Activities....................................................................................................14 3.1.3. Structure.....................................................................................................15 3.1.4. Human resources........................................................................................16 3.1.5. Management style......................................................................................18 3.1.6. Interface with environment........................................................................20 3.1.7. Infrastructure..20 3.2. Micro finance Performance..................................................................................20 3.2.1. Information and accounting system..........................................................20 3.2.2. Management information system...20 Status of SHGs program........................................................................21 4.1. Non financial........................................................................................................21 4.2. Financial...............................................................................................................22 4.3. Loan process.........................................................................................................23 Observation and Recommendation25 5.1 Mission..25 5.2 Activates....25 5.3 Structure.25 5.3.1 Possible organization forms for ...26 5.4 Human Resources..................................................................................................27 5.4.1 HR policy preferably annualized..................................................................29 5.5 Management...........................................................................................................29 5.6 Interface with external environment......................................................................30 5.7 Micro finance program performance.....................................................................30 5.7.1 Observation...................................................................................................30 5.7.2 Recommendations.........................................................................................31 5.7.2.1 Operating System.................................................................................31 5.7.2.2 Monitoring Systems.............................................................................32 Proposed Capacity Building Plan.....................................................................32 A. Formation of core team for Micro Finance B. Orientation on Micro Finance principles and concepts

4.

5.

6.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Streamlining of existing micro finance systems Develop appropriate operating procedure Legal Form Product Development Business Planning Conducting specific training programs for the microfinance team Expected outcome 7. Critical Observation.34 Annexure 1 Summary of Joint Initial Assessment.................................................... Annexure 2 Snap Shot of Proposed Capacity building plan . C. D. E. F. G. H. I.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Joint Initial Assessment Report For Janmitram Kalyan Samiti, Raigarh Summary of Assessment
Name of Ogganigation Area of Assessment Organization Design Mission Max. Score 260 Janmitram Kalyan Samiti (JKS), Raigarh(CG) Score % Score Observations Summary 173.5 66.73% JKS mission is clear to the BoD, & Mgt. but there is need for orientation to other 65.00% staff and field team. JKS activities are very much supporting 85.00% the organization mission JKS, HR structure well define. Role & responsibility is clears. Direct contact with higher authority by staff. There is need for power delegation to subordinates at different level of work 64.50% JKS has trained rural development oriented team at higher and middle level. There is need for orientation and training at field/ cluster/ village level staff on 75.00% quality services and time management. JKS has followed Democratic pattern and seek inputs from staff in decision making. At all level. They yet to be hire mF professionals for managing proposed mF 72.50% operation. JKS have good linkages with local government and national rural development Programmes. They need to build collaboration with Banks and other financial service providers for smooth 50.00% microfinance operation.

20 Activities 20 Structure

13

17

100 Human Resources

64.5

40 Management Style

30

40 Interface with Environment

29

40

20

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Microfinance Program Performance Micro-finance is the emerging demand of Janmitram ultimate clients/ SHG as it leads towards achievement of its mission. It also fits perfectly into the micro enterprise development work; they also understand the importance of financial intermediation for livelihood promotion. Staffs are aware about the operating system but they are not aware and have not taken any training about this. Financial Performance needs significant 33.33% improvement. As per client feed back assessment JKS is focused to Rural poor empowerment. Client accepts There economic conditions are much change in since past five years. The SHGs loan sanction procedure is 86.00% very simple. 57.68%

120 Client Feedback

40

20 GRAND TOTAL 400

17.2 230.7

Date of Assessment: 9-10th July 2010

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Key Information
Full Name of Organization Present Legal Status

Janmitram Kalyan Samiti (JKS), Raigarh (CG) Registered under Societies Registration Act of Chhattisgarh1973, Registration No. - 0838, Dated 31st October 2002 Registered under Foreign Contribution Regulation Act Registration No. 327510006 Nature: Cultural, Economical, Educational, Social Registered under Section 12 A of Income Tax Act Registration No. - 15/2003-04 Dated Registered under Section 80 G of income tax Registration No. CIT/BSP/ TECH/80-G/05/04-05 Dated- 30-5-05, Period of validity 25-11-2004 to 3103-2007 Our PAN No: AAAAJ2306F

Address for Correspondence Telephone Number (with STD Code) E-mail Website Contact Person with Mobile Number

Indian school road, Kelo vihar plot No. 74 Raigarh (CG) 07762- 224379 & 07762 220083 janmitram@gmail.com, Janmitram@yahoo.co.in www.janmitram.in Dr. Mukesh giri goswami (CEO) Mob: 098261-44243 Mr. Manish singh (Secretary) Mob: 09826187810 All Bilaspur Division of Chhatisgarh 736 Groups JIA Study Team

Geographical Coverage of SHG & mF Programme Outreach (SHGs/Members)

Janmitram kalyan samiti

Dr. Mukesh giri goswami, Manish singh, Ramakant, Rakesh kumar, Ravikant meena and Mrs.Uttaravali Mr. L.M.Tiwari (Sr. Mgr.) & Santosh patel (Asst. Mgr.)

BASIX

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

EXECUTIVE SUMMARY
Janmitram Kalyan Samiti (JKS) is the sole technical, non-government, non-profit organisation based at Raigarh, Chhattisgarh since 2002. Janmitram Kalyan Samiti came into its existence in the year of 2002 by few like minded professionals with an intention of rural development by managing different rural resources. The organization is operating with north east part of Chhatisgarh state. The organization is presently working with Raigarh, Janjgir, Champa and Jashpur districts, where major operation exists in raigarh district only. Since its inception, organization has worked with different communities by organizing them into SHGs, providing necessary training to built their capacities and facilitate in bank linkages program. Till the year 2009, organization has formed and managed almost 766 SHGs. Started with SHGs, the organization has dealt with various programs like: Development of micro planning with support of state forest department, entrepreneurial skill based program, Lac Cultivation and Processing under SGSY Special Project along with collaboration of ILRI (Indian Lac Research institute ), Ranchi. As organization felt that further support would be essential to those of the groups supported for doing income generation activities like Lac cultivation and processing and Fly Ash Brick manufacturing. In the view of need to provide various handholding support to these groups along with supporting other rural business in future, the organization has floated a separate entity in the name of Janmitram Marketing and Consultancy Limited JMCL under company act, which is involved in providing marketing and other technical consultancy for different rural produce. The organization doesnt involve in any production activity but they are actually helping their groups and other rural producers by assisting them in various way. It is registered as a society registration act 1973 on 31st October 2002 and started working to create self-employment in the rural population by multidimensional approaches Janmitram Kalyan Samiti has been providing income-generating opportunities by promotion of Self Help Groups to take up Lac Cultivation and processing, Fly Ash Bricks manufacturing and other income generating activities. Presently JKS has approx 430 SHGs engage in Lac cultivation and its processing and almost 16 members are engage in manufacturing of Fly ash bricks. Since the project of above mentioned activities is almost wind up. So, for the sustainability of the groups and their activities, the organization has started marketing and other technical supports to all those groups through setting up its separate entity Janmitram Marketing and Consulting Ltd. (JMCL) which is a consultancy ISO 2009 company and also arrange working capital fund from different banks as well as FIs under the Capacity of Parent organization. Same time they have also laid foundation of RISA and JISAD. RISA- Raigarh Integrated Shellac Association is going to be a section 25 company, made by self help groups that participate in their lac cultivation program. JISAD- Janmitram Institute of Skill and Development is a new division in janmitram solely concentrating on vocational training of youth. Beside it shall also work for capacity building of PRIs.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) JKS board requested to BASIX for extending support for strengthening their microfinance operations, developing appropriate monitoring and control systems, along with the appropriate HR systems including competencies to build detailed business plan. For extending the Institutional Development Support to JKS, BASICS Ltd. proposed to conduct the Joint Initial Assessment study for critically assessing organization across six basic elements, and how they in turn affect the program performance like, Organizational design, performance, organizational climate, Stake holder, and customer satisfaction. The process followed for the assessment was highly participatory and inclusive. Both primary and secondary data was collected from the organization and field visits by using structured and semi structured discussions, questionnaires and inferential techniques.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

1. Introduction
Janmitram Kalyan Samiti (JKS) is a Non Government, Public Service Organization working since 2002 registered under Chhatisgarh Societies Registration act-1973 based at Raigarh. Their registration number is 838 dated 31st October 2002 and operating area is 5 district of chhatisgarh state. JKS is working in 4 districts named Raigarh, Bilaspur, Jaspur, and Janjgir-Champa They have covered 10 blocks of above mentioned districts. Janmitram Kalyan Samiti has been providing income-generating opportunities by promotion of Self Help Groups to take up Lac Cultivation and processing, Fly Ash Bricks manufacturing and other income generating activities. Presently JKS has approx 430 SHGs engage in Lac cultivation and its processing and almost 16 members are engage in manufacturing of Fly ash bricks. Since the project of above mentioned activities is almost wind up. So, for the sustainability of the groups and their activities, the organization has started marketing and other technical supports to all those groups through setting up its separate entity Janmitram Marketing and Consulting Ltd. (JMCL) which is a consultancy ISO 2009 company and also arrange working capital fund from different banks as well as FIs under the Capacity of Parent organization. Same time they have also laid foundation of RISA and JISAD. RISA- Raigarh Integrated Shellac Association is going to be a section 25 company, made by self help groups that participate in their lac cultivation program. JISAD- Janmitram Institute of Skill and Development is a new division in janmitram solely concentrating on vocational training of youth. Beside it shall also work for capacity building of PRIs. JKS is managed by 9 members of Governing Board. Every member is responsible for implementations of specific project in one district. Dr. Mukesh Giri Goswami and Mr. Manish Singh who is the guiding force for the promotion of JKS are monitoring every project. With the current status of micro finance operations JKS is keen to Start their Microfinance Program to all the beneficiaries reached. They requested BASIX for extending support for strengthening their micro-finance operations, developing appropriate monitoring and control systems, along with the appropriate HR systems including competencies to build detailed business plan. Both the organizations have agreed to collaborate as per the understanding our personal discussions, details of which are given below. 1.1 Expected Outcome of the Joint Initial Assessment study This study will provide a solid foundation for a practical and implemental micro finance project strategy and action plan. It is anticipated that a principle outcomes of the study will be an agreed action plan whereby JKS and BASIX Ltd. may continue to work

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) together in a partnership to improve the delivery of credit and micro-finance services through the project.

2. Methodology
2.1 Study Framework: An agreement through mail provides the framework for the study. The diagnostic study tool- developed by BASIX to assess the capabilities of the organizations was administered. The tool employs structured and semi-structured discussions, questionnaires and inferential techniques critically assessing organizations across six basic elements, and how they in turn affect the program performance like, a. Organizational Design Analysis (linking structure, workflow etc.) b. Performance Analysis (looking at some of the elements of finance, repayment rates, accuracy of records and so on) c. Organizational Climate d. Stake Holder Analysis (whether different stakeholders are happy with the organization or are there any conflicting interests?) e. Customer Satisfaction Analysis (what the customers think of the services provided, their quality and price. f. Competitor Analysis (looking into who are the others providing similar services in the area and their relative position).

2.2 Process Followed The process followed for the assessment was highly participatory, which included using both secondary and primary information. The secondary information project reports, brochures, organizational reports and balance sheets of JKS were also referred. Some of the project staff accompanied the team on the field visits and were involved in the discussions with groups. To develop a comprehensive understanding of the current status of the micro finance program and to seek the inputs of all the stakeholders SHGs, project staff- project teams comprising project Manager, field supervisors and senior management from Office were taken. The process followed during the study is outlined below: Steps Collection of background information
(See Annex 1 for completed Operational Information Datasheet)

Details Collection of information on the organization mission, activities, area of work, infrastructure, organizational structure, human resource, information system, funding and other collaborations and details of SHG program.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Client Feed Back Framework Visit by BASIX staff Client feedback on Group dynamics, Meetings, delivery of services, Needs, Products & the Impact Mr. L.M.Tiwari, Sr.Manager Institutional Development Services, Mr. Santosh Patel, Asst. Manager-IDS visited both office and field to interact with staff and SHGs members. Present systems of SHGs promotion and management, problems faced and need for improvement. Visit to SHGs to gauge the level of motivation, awareness, Leadership, group discipline, meeting their needs in groups and looking at their record keeping. Staff feedback on organization work environment, level of decentralization, coordination and teamwork, and motivation. Future strategy for MICRO FINANCE expansion vis--vis organizational growth plan, recommendations for improvement, human resource allocation, future strategy for fund raising for MICRO FINANCE and other projects.

Discussion with staff concerned with Nawa anjor program Visit to SHGs

Organizational climate assessment. Discussion with senior management

Consolidation and Report Preparation

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) The whole process was conducted for two days. The Joint Initial Assessment study visit followed the schedule given below: Days/ Timing Day 1: 09.07.2010 9.30 to 11.30 Meetings/ discussions: BASIX team will brief about objective of 2/3 days visit for JIA and possibility of collaboration with NGO/CBO by BASIX team and same time final scheduling of 2 days work with organization NGO functionaries will start with history and establishment process (path of development) of the organization which includes key projects, promoters and their contribution to the organization. Detail discussion on all ongoing assignments, projects, their coverage, management, HR status, methodology of implementation. Deep discussion on only Livelihoods/ SHG and MF related assignments which includes objectives, scope, methodology, current status, geographical coverage (operational area mapping exercise) , and future planning. Operational area visit to village / SHGs or ultimate clients in one/ two location (NGO should categories the whole livelihoods/ SHG and MF intervention in to three category (average, good and poor) and plan visit accordingly. Chief functionaries of NGO/ CBO/ Branch head, Project unit head, board members, key HR Activity/ meetings to be undertaken BASIX team With

11.30 to 13.30

Key functionary and Livelihoods/Federation/ SHG and Microfinance staff

14.30 to 18.00

With Junior staff and field workers ( not to involve Chief functionary)

Day-2 : 10/07/2010 8.30 to 12.00 Operational area visit to village / SHGs or ultimate clients in another location (NGO should categories the whole livelihoods/ SHG and MF intervention in to three category (average, good and poor) and plan visit accordingly.

With Junior staff and field workers ( not necessary to involve Chief functionary)

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) 12.00 to 13.30 A quick feedback by BASIX team on field visit (cover both positive and negative if any) to the NGO and staff: carefully take explanations / clarifications by staff and NGO. Presentation by BASIX team on overview of SHG and MF in India and its role in poverty eradication to the team (clarification on MF and SHG related issues) Conduct the Organizational climate survey with staff other chief / head of NGO/ Unit Key functionary and Livelihoods/ SHG and Microfinance staff

14.30 to 16.30

Key functionary ( not compulsory but if he / she are and Livelihoods/ SHG and Microfinance staff ALL staff NGO/CBO

16.30 to 18.00

3. Assessment
The summary of assessment being presented in this section is based on the joint initial assessment framework mentioned above. The assessment constitutes of two parts I. Organizational design II. Program performance

3.1 Organization Design 3.1.1 Vision of the organization To intervene among backward and disadvantaged communities by rising awareness and skill to make them enable for recognizing better opportunities offered by our great democratic nation. Mission of the organization Improving health and educational status for women and children. Improving economic status of ST/SC and Marginal sections of society through employment generation, Skill development, and liaison for capital arrangement. To institutionalize services in unorganized sector and Introducing Proven technologies and ideas for better living. Conservation and management of natural resources through peoples participation. Strengthening community organizations, local bodies, and Panchayti Raj Institutions for effective self-governance. Advocacy for Human rights and people's initiatives for social justice - 14- Prepared by: BASIX Consulting and Training service Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

The Major Areas of intervention: The major area of intervention is follows. Enhancement of livelihood status of the tribal area of Chhattisgarh through income generating activates. Socio economic development through enhancement of agri. Productivity, Biomass regeneration and conservation. Skill development of youths and PRIs 3.1.2 Activities The organization has focused undivided attention and expended tremendous effort on the social and economic issues faced by the rural families in an integrated manner with Tribal, landless labour, rural artisans, small and marginal farmers and women and children. The major Activities and achievements of the organization: Janmitram started work with grass root level planning for integrated village development. State forest department supported this micro-planning endeavor (November 2002). We started Health Mitanin project in Gharghoda block with great support of women (February 2003). Support of peoples and government continued as we prepared micro plans for forest department in Jashpur district. NABARD (National Bank For Agriculture and Rural Development) Assisted us for formation and nurturing 100 self-help groups in Gharghoda and Lailunga blocks. We were asked to facilitate Mitanin project in Lailunga block (march 2004) and Manora block of jashpur. This was recognition to proffered dedication of our volunteers and organizations efficiency to deliver peoples cause. District Collector, after visiting few of our women self group, asked us to form SHGs under SGSY Scheme (September 2004). NABARD repeatedly provided us opportunity to generate employment opportunities through its REDP (Rural Entrepreneurship Development Programme) in Jashpur (February 2004) and pussore (November 2004). We also commenced few skill development programmes for self help groups and semiskilled entrepreneurs. NABARD and District employment officer assisted them. Janmitram has facilitated more then 3.5 million Rs. credit flow through its skill development, REDPs and SHG programme in the district, which is a record of its kind. We launched intensive training campaign for lac cultivation and processing through women self help groups of Gharghoda and kharsia blocks, With help of experts from ILRI (Indian Lac Research Institute), Ranchi. Over 300 families are reaping benefit of lac production and the knowledge is now disseminating itself. This programme was jointly supported by State Forest Department and DRDA under SGRY programme. DRDA affiliated us as facilitating agency for capacity building and mobilization under HARIYALI integrated watershed development project at Lailunga block. Janmitram, as a consortium with partner organization YUVA (Youth United for Voluntary Action), was assigned to prepare micro plans of 110 Pancahyat, spread in Tapkara Block of Jashpur district and Orgi block of Sarguja (January 2005). This was the task that provided us opportunity to be a partner in WORLD BANK assisted CG District

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Poverty Reduction Project. Successful completion of task was appreciated through selection as NGO-PFT in Tapkara block. Being a social organization, we bear the responsibility to advocate to public interest. Our involvement with government in goal oriented development projects never stood in way of vacating peoples cause. Janmitram proud to be an axis of movement against destructive manner of industrialization in Raigarh district. Organization successfully led the movement, negotiated peoples terms, and forced authorities to take action against polluting industries of industrial park. (February 2005). Strengthening community organizations, local bodies, and Panchayti Raj Institutions is one of integral part of our mission. We recognized womens empowerment potential though Pancahyat Raj Institutions in early days. We conduct training for PRI representatives at regular intervals for effective self-governance An intensive Pre Election Voters Awareness Campaign (PEVAC) was also started by Janmitram, during PRI elections in chhattisgarh (December 2005). More then 50 women having membership of our SHGs and Mitanin programme got elected for various PRI post. 3.1.3 Structure

Legal Status:
1. Registered under Societies Registration Act of Chhattisgarh1973, Registration No. - 0838, Dated 31st October 2002 2. Registered under Foreign Contribution Regulation Act Registration No. 327510006 Nature: Cultural, Economical, Educational, Social 3. Registered under Section 12 A of Income Tax Act Registration No. - 15/2003-04 Dated

4. Registered under Section 80 G of income tax

Registration No. CIT/BSP/ TECH/80-G/05/04-05 Dated- 30-5-05, Period of validity 25-11-2004 to 31-03-2007 5. PAN No is AAAAJ2306F

Organogram: Dr. Mukesh giri goswami and Mr. Manish Singh is a Forest Development profession having 20 years experience in rural development at all level starting from grass root to CEO of the organization, there experience of Business development planning of rural finance operation, Operational planning and breakeven analysis in view to make profitable center, Formulating project proposals, financial planning & budgeting of project activities, Village institution (SHGs) development and village development Planning.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) They guided by a board of governors comprising of 9 members with sound experience in forest and social development sector. The middle level management is mostly people well qualified and the field team is mainly constituted of locally grass rooted people.

Organogram diagram

3.1.4 Human resources Staff Skills: Most of the core staffs in JKS are working since start of the organization. The senior management and some middle level staff have assimilated the mission of the organization very well but for smooth implementation of the project better understanding of the mission of the organization has to be inculcated with the grass root level staff. But at present level, it does not seem that the staff has got the required skill to scale up their micro Finance operations. It is momentous to quote here that the staff responsible for carrying out the micro Credit operations of the organizations are not objectively selected looking at their skill vis--vis need of the position they have occupied. - 17- Prepared by: BASIX Consulting and Training service Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Training: Capacity building of the staffs of the organization is the crux for better result and output. JKS looks at the capacity building as an important integral part for the value-addition in staffs performance, so around 50- 60% of their staffs is already trained on the different aspect of project activities. Trainings are conducted from time to time to upgrade the skills and capacities of the Staff at all level based on program and budgets Some major training received by the staff is on Micro finance and its norms, Gender, Lac cultivation, SHGs management, Organizational behavior, communication. The major training agencies are Govt of CG., NABARD, and ILRI- Ranchi etc. Information flow in the organization Based on the formats information from different level are collected. Along with the quantitative information a report is also submitted from different staff, which is compiled at the field office level and ultimately at the organizational level. Project specific reports are than formulated to be sending to funders. It could be said that there is a wellstructured information flow from ground level to HO. Every month staff meeting conducted in Head office and all staff submitted project progress report to concern project coordinator. Then compiling the data and sharing progress status of the project. Organization culture and climate: The staff feels that the work culture is very good in the organization but in terms of the interfaced with the environment and mF program performance is rated low. Rest of the things like Structure, Interpersonal relationship, mission, activity and client feed back is rated above average But in spite of all these, the communication flow is a matter of concern in the organization as lower level staffs are made to multi-reporting and the principle of unity of command is not maintained in the organization. Recruitment of staff Generally recruitments for field level staff are done through word of mouth or advertisement and depending on the staff/project requirement. But are also Selection based on experience and qualification & interview. Usually they recruited staff as per their project guideline. Permanent Staff Temporary staff Professional (For training) 86 100 approx 9 (Sericulture, medicinal plant, Lac cultivation, Bio fertilizer, Herbal medicine, Mushroom cultivation, etc.) 15 (Forestry, Doctors, engineers, legal advisors, CA, computer experts

Consulting

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Incentive to staff Employees are salary based. Salary is paid for all the Staff based on fixed salary and payment mode by cheque. Minimum salary 1500/- and maximum salary 20,000/- paid by JKS. A new system of providing incentives over and above the salary for the work of micro finance has been started by the organization.

3.1.5

Management style

The board is constituted of 9 persons associated with experience in forest and social sector. Every board member has sound experience in social services (the experience is in between 10 20 years). The Board members do not have any experience in micro finance in terms of doing micro-finance or building the institutions for doing micro finance. The frequency of the Board meetings is Quarterly basis. It was observed that the board is active and the relationship between staff and the management is consultative. And the attendance was more than 90% for the last three board meetings. JKS is having good management system. Total Nine members in the board, among these nine persons one is designated as president, one are vice-president, one are secretary, one are treasurer, one are joint secretary and four are member of executive council. Election schedule in every three year term. Management is sincere and regularly participating in meetings. Management is responsible for any decision. The details of the board members are given below:Sl No 1 2 3 4 5 6 7 Name Designation Place of Residence Raigarh Raigarh Raigarh Raigarh Raigarh Raigarh Raigarh Qualificatio n Ph.D., Msc. MBA Bsc. Post Graduate Post Graduate Graduate Graduate Experience in Yrs
in Rural Developmen t in Financial Services

Attendan ce at past 3 Board meetings

Dr. Mukesh giri goswami Mr. Prakash singh Mr. M.K.Singh Mr. Ravi kant meena Smt. Mona pandey Mr. Jivan bhagat Mr. Bharthari jaiswal

President Vice president Secretary Joint secretary Treasurer Member of executive council Member of executive council

15 years 10 years 10 years 8 years 8 years 8 years 7 years

5 years 3 years 3 years 2 Years 2 years -

3 3 3 3 3 3 3

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) 8 9 Ku. Sumati bhoy Smt. Sevati gupta Member of executive council Member of executive council Raigarh Raigarh Graduate 12th 7 years 5 years 3 3

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

3.1.6

Interface with environment

JKS enjoys a good reputation in Chhatisgarh among the social and livelihoods development sector and considered as a major player in the same sector. Organization has good networking and relationship with CG government and line department. But still there have no collaboration with any apex bank and any financial institution. 3.1.7 Infrastructure

Though the registered office is at Raigarh, the major infrastructure is developed at Raigarh. They have their own building with adequate arrangements for the office, the office are equipped with table, chair, computers, laptop, vehicles etc. The branches are equipped with necessary infrastructure. Details of Infrastructure S.No. 1 2 3 4 5 6 7 8 9 10 Particular Office building (branch + head office) Computer set Laptop Printer Digital LCD projectors Office table and chairs Four wheels Two wheels Training equipments (AV/ DVD) Training hall with furnished accessories Quantity 2+1 10 2 1 1 25/100 2 14(Personal member) 1 set 2

3.2 Micro finance Performance 3.2.1 Information and Accounting System The account system of JKS is updated on the excel sheet in the computer in the Head Office level. The operations data relating to groups are captured by the field worker maintaining the following documents at the group level. 1. 2. 3. 4. 5. 6. Attendance cum minutes book Saving register Loan register Individual member passbook. General Ledger Cash book - 20 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) 3.2.2 Management Information System Printed records are available with all the institutions. The members and the field staff of the organization update the records. The information collected and compiled at the unit level is reported to the Head Office but there is no specific period for the collection of the information. Partly computerized but there is no specific software available, using MS Excel to compiling. The complied information is used for the planning and decision-making. System for the cash management doesnt exist. MIS needs significant changes for medium term growth. 4 STATUS OF SHGS:

The organization is involved in promotion of Micro credit through formation of SHGS and income generating activities .It has form 766 SHGS at the village level .These SHGS are carrying credit and thrift activities with their savings and through Bank linkages. Formation of SHGs. Conducting Awareness camps Motivating the members for Savings. Linking them with the Banks. Arranging Cash Credit facility to the groups. Motivating the members to repay the loans. JKS has promoted 766 SHGs in 5 blocks under this program in the operational area. The savings of the members from Rs.30 to 100Rs. The Savings amount is deposited in the banks and it is observed that some SHGs are keeping the money with the group itself, for the emergency purpose and also due to the distance between the Village and the Banks (due to transaction cost). The interest rate on internal loans in SHGs is 36%p.a. The SHG meets every Week. The loans provided through SHGs are utilized for income generation activities mainly including Agriculture, lac cultivation and loans are also provided for Social consumption requirements through internal lending. Every SHG is maintaining the printed records (Register) supplied by JKS under the same program, which includes Cash Book, Loan Book, Attendance register, minutes Book. Products & Services: JKS is linking the Institutions to the Local service area Banks to deposit the savings amount and also to avail the credit facility to the institutions. Other than this JKS doesnt have any special products to cater to its clients. The status of SHGs can be measured using the following parameters: 4.1 Non Financial Conceptual Awareness: The SHGs are not very clear about the concept, objective, and process of forming the SHGs, and they also lack the vision and road map for future. Although a sense of ownership among the women is evident this will be re-enforced with more clarity on SHG concept and can be strengthened. Activities: Groups are mostly involved in thrift activities along with involvement in social issues like forest guarding to prevent further tree felling and economic issues like Agarbatti making, Community farming, lac cultivation, by few groups. - 21 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Governance and Management: Each group elects 2 leaders who lead the group on issues related to savings and credit and also on social issues. However there is a lack of role clarity among the group members and responsibility sharing by the group members was less visible. Byelaws are written in the minutes books but are not being followed, even members are not aware about them. Meetings: Meetings are held regularly and varies in accordance to the convenience of the groups i.e. weekly, fortnightly and monthly meeting. Mostly they are conducted on fixed place, fixed time and fixed date with exceptions of few groups. In few groups it was observed that few SHGs meet jointly and discuss issues together even their registers are maintained together. Saving is the main thrust of the group with discussion mostly revolving around social issues and also credit to group members in few groups. One thing to note here that Books of accounts: Minutes books, Attendance register and saving books are maintained properly, but no record has been kept regarding internal lending, repayment rate or other financial transaction records. It was also observed that they lack uniformity regarding method of record keeping in different centers. It was observed that the group maintains almost all records but in a fashion, which only the record keepers can understand. The group maintains accounts in a very rough manner since they have no access to any printed MIS format. Savings frequency and regularity: Savings are collected as per the scheduled meeting varying from Rs. 30/- to 100/- in groups. Internal-lending: No record has been kept by the organization however it was observed that internal-lending has started in few groups. Decisions about the loan are mostly taken in the group except in case of emergency needs, which are later on conveyed to the rest of the group members. The loan is utilized for consumption in new groups and also for productive purpose in few older groups.

Financial Mobilization of funds: Funds into the groups are exclusively from savings. No fines have been charged from the group members neither any grants received from any external sources. The groups are too small in age to approach banks for linkage. Rotation of funds: No data is available at organizational level about the utilization of funds but it was found during the SHG visit that 50% SHGs have started rotating their savings for internal lending but rest are not because of the age of group. Savings amount: The savings amount ranges from Rs. 30 to Rs. 100/- in different groups. Interest rate on loans and savings: The interest rate on loans varies from 12 to 18% per annum and is calculated on both declining balances as well as flat balance in different groups. The group doesnt provide any interest on savings. - 22 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Repayment rate: No track kept by the organization since groups are comparatively new and internal lending has started in very few groups. The records of the group also dont reflect the repayment rate of the loans taken by the members. Bank accounts & Bank Linkage: The groups have opened their accounts in the nearest banks but have not yet approached them for bank linkage. Utilization of funds: Funds are utilized both for consumptive purpose as well as productive purpose in different groups. No data is available to give an idea about the proportion of fund utilized and idle fund kept in the group

4.3 Loan Process JKS follows a decentralized decision process for its Micro Finance operation, which has several steps like Loan Origination, Appraisal of loan, Sanctioning, Disbursement, Recovery, withdrawal of saving. The summary of the loan procedure are as follows. Decision Matrix Decision Who? Where? How?

Origination of loan Application/ proposals members

SHG meeting Endorsement by other members of the venue group and its leaders.

Appraisal of loan Field staff proposals Sanction of loan Bank

SHG Meeting Branch/Unit office

Personal applicant

discussions

with

the

Taking up every proposal with the respective field worker and discussing the need of the applicant and repayment. Cash disbursement or account payee cheque.

Disbursement loan

of Bank

Bank

Repayment follow- Field staff up Withdrawal Savings of SHG member

SHG meeting Monthly collection venue Bank Cash

Capacity Building Trainings: JKS is building the capacities of the institutions on a continuous basis. Trainings are provided to the Leaders / members of the institutions. The trainings are based on their job responsibilities and training needs. Organization is spending significant amount on trainings. Some major trainings received by the members of the institution are on Savings, Internal loans, Gender, Health, Marketing, Different crops, lac cultivation, Micro Enterprise development, Skill development (Occasional training) vermin Compost preparation and on some important trainings on non farm sector activities. - 23 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Repayment rate: Repayment rate of the institutions is 100% with the organization for the external loans. Record maintenance: The institutions are maintaining all the records. The field workers and the group members will update the records. The Institutions are maintaining the following records Institution S. No 1. 2. 3. 4. 5. 6. 7. 8. 9. Records SHG Cash Book Savings Register Loans Register Attendance register Minutes Book Member Passbook. Other registers Frequency of Meetings Frequency of data collection by JKS 3 3 3 3 3 3 Weekly Monthly and as per project needs.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

Observation & Recommendation 5.1 Mission

As an organization mission statement is very broad and directly supporting livelihood promotion, which is fairly understood by the senior management and middle management but it needs to percolate down to the field level staff of the organization. Clients need to be more clear and aware about the mission of the organization. The planning and strategies of the organization for its different projects are aligned to its As per Mission statement. JKS should continue to work for livelihood and other development issues along with proposed MF operation. But some recommendations are below Mission should address livelihood & mF directly. Mission needs to be shared with the all staff through training and orientation programs. Field staff to share the same with clients Visioning workshop for key staff and Governing Body members and planning council

5.2 Activities
The activities being implemented by the organization are directly aligned to their mission and vision. Activities are implemented in field are: SHG promotion: It includes SHG promotion, saving mobilizations, Training to the group leaders (Local Resources Persons) and linking the groups with the Banks. Direct Members: It includes registration of direct member; improve saving habits of the member, financial assistance to the direct members. Saving and credit products are limited to SHG only as NGO not directly doing this. The JKS has not fully assessed the various risks and costs linked to the development of new financial products Organization does not offer insurance services to their customers. Recommendation: It is strongly recommended to place adequate focus on livelihood promotion activities that will directly and positively affect the credit absorption capacity of the members. A well- conceptualized and planned livelihood intervention strategy is recommended at the earliest. JKS needed to Clear demarcation on financial and non-financial activities, and take up only few components of developments based on own specialization rather than availability of projects. And before the product design conduct Client needs assessment. Existing structure does align to the operations and volume of business, which is fully departmentalized with exclusive manpower to handle at Project level but needs some restructuring by looking at the business need of the NGO. As they generally say that a - 25 Prepared By: BASIX Consulting and Training services Ltd.

5.3 Structure

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) promoter cannot be a financer and a financer cannot be a promoter, on the basis of this fact, JKS should look forward to segregate its promotional workforce with the operational workforce. Additionally, it is also advised to have a different wing for their food processing business, and have separate audits for micro Finance activities. Its Organogram exists and is directly aligned to the activities and operations. Roles and responsibilities are well defined but not documented in a manual form. After Assessment JKS need to some changes Existing Structure Introduction of Risk Management Dept. IT based MIS division. Power & responsibilities to be delegated. Quarterly Internal Auditing necessary.

5.3.1

Possible organization forms for JKS

As discussed with JKS as the organization want to do financial intermediation of its own with large scale, Section 25 Company, Cooperative or NBFC becomes more suited legal form for JKS. Table: Comparative Analysis of the Legal Provisions for Various Organization Forms
Type of entities
1

Not for profit

Mutual benefit

For profit

For profit

Legal form

Society/Trust/Section 25 Company

Purpose

Services to others

Mutual Aided Co-operative Societies (MACS, only in A.P so far ),Urban Co-operative Bank(UBC), cooperative societies Mutual Help

Non Banking Finance Company (NBFC)

Local Area Bank (LAB)

Business

Banking Activity

Laws under which incorporated Laws under which Licensed for banking Ownership

Societies Regulation Act,1860 / Indian Trust Act,1920 /Companies Act, 1956 No License provided for

AP MACS Act, 1995 or State Co-operative Act or Central Multi-State Coop Act RBI license under BR Act, 1949 and Cooperative Societies Rules Shareholding members

Companies Act, 1956

Companies Act,1956

Reserve Bank Of India Act , 1934, NBFC Rules

5 6

No Owners in case of Societies and trusts. By governing Board / Trustees, Trustees not replaceable. Sec 25 Co. by elected board of Directors

Shareholders

RBI Act 1934 ,Banking Regulation Act, 1949 Shareholders

Governance

Elected Board Of Directors

Elected Board Of Directors

Elected Board Of Directors

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

7
Deposits NO in case of societies. Deposits may be accepted only after obtaining permission from the RBI. The companies (acceptance of deposits) rules would apply. YES Nil Coops can accept deposits from members. UCB can accept deposits from general public with the permission and under supervision of RBI May accept public term deposits - minimum investment grade, subject to permission from RBI Can accept any sort of savings

8 9

Borrowings Supervision by RBI

YES Low to medium (UCBs)

YES Low to medium (due to large nos of NBFCs)

YES Medium to high(yet to start)

5.4

Human Resources

A well trained and skillful human resource works as the catalyst for the growth and development of an organization. Most of the staff with JKS is locals with good knowledge of the operational area. JKS has a blend of both female and male staff. Middle management and field level staff are having either at least graduate. Recruitment is done through word of mouth and selection is done on the basis of education, interview, and prior experience. Educational background and skills matching with present job profile is observed with the basic orientation on micro finance. But financial management and financial monitoring seems to the weakest link of the micro finance operation in JKS. The team was found aware of the micro-finance system, which they were operating. The principle of micro finance and its finest detail was not found to have inculcated within them. Performance appraisal system is not practiced. The MIS was only way for appraising an individual. Here it is also to be said that this appraisal does not count much as there is no mechanism to upgrade the performance of the individuals. Specific human resources should be allocated for the micro finance operation, which can either be recruited or deputed from the existing resources. Manpower planning should be done very carefully in an MFI. The skills and experience required to perform each function should be detailed and then the process of identifying the people who make the best fit should be initiated. The functional areas and functionaries should be clearly demarcated. Separate cell for MF operation to introduced and trained, exposed accordingly. Training is provided to the Staff after the individual staff needs are assessed. Work culture, relationship and communication flow of the staff are good. Based on the above observations few recommendations are as follows. Skill of staff: The capacity and skill of staff, specially the low-level staff who work in the ground field work, needs to be better for micro finance activities. It has been noticed that the communication is not strong enough with the customers as many customers have not clear cut concept of the vision of the organization as well as many other confusions about - 27 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) the loan, its purpose and processes. All staff is not equally well informed about the loan product and its features. Cost effectiveness is not a concern among the team members which also shows their understanding about the mF program. While assessing the loan proposals absorption capacity of the customer is hardly appraised. Besides, it was also observed that even the senior level staff is not actually fit enough to look after the entire operations of the NGOMFI. The training of the staff, especially field staff and middle level staff, is recommended strongly. An orientation on the concept of microfinance which will include the livelihood aspects, model of mF delivery, financials of mF , need to be conducted to build the perspective of the team members towards micro finance and livelihood. Exposure program may help the low level employee to understand the mF operation very well. It is strongly recommended that the employees can be sent for the exposure program with other organizations that are evolved in the mF. More over these, some frequent training sessions need to carry on systems i.e., loan proposal origination, documentation, appraisal techniques, loan sanction and loan disbursement etc. Job Description: The job description is not well defined. Most of the work is centralized to few places. They do not have any decision making authority. Hence s/he must have a detailed job description with suitable authority and responsibility. Every employee should have a specific and clear-cut job profile. This gives a space to the employee to identify their individual role in the institution. Clarity in deliverable reduces chances of confusion among the team and also reduces cost of operation. JKS needs to work on this aspect seriously. Make Operational manual and HR manual and it is inadequate to give the employees a clear picture of their deliverables. Recruitment Procedure: Recruitment process followed in JKS is very simple. The process does not include any strong assessment scale for the candidate. The candidates are selected on word of mouth and prior experience, if any. Recruitment and selection process of the incumbent need to be more strengthened. The qualification and the experiences need to be given utmost importance. Professionals should be encouraged to join the system. But ultimately whosoever is being the opportunity, the only criteria for recruitment should be the matching of their qualifications, skills with the requirement of the position vacant. Compensation to staff: Consolidated salary is paid to the staff. Organization should make provisioning for the staffs recognition and reward for the good performance in terms of motivation. Leave rules should also be encouraging for the staff. Remuneration is something which motivates an employee immensely. The remuneration system should be well-defined and explained in an easily comprehensible manner. It should have the element of objectivity inbuilt. It should be such that the people are motivated to perform better each time. The remuneration system should also have a clear reward system in the form of incentives so that merit from whichever quarter in the

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) organization gets rewarded and the organization in future itself becomes a quality performer. Staff Appraisal: There is no formal appraisal system for staff. For both professional growth and retention of staff, a well defined staff appraisal system must be introduced. JKS is recommended to design a strong appraisal system which must have inbuilt with many variables right from the communication, efficiency, affectivity, to personal relationship, personality, scope of future development etc. Organization culture and climate: Staff expressed their happiness about the good working environment and communication between the staff. The staff gets timely guidance and encouragement from the mentors. They expressed their freedom of choice to work with their authorities and share their difficulties and problems at the operating level. They are being recognized for their performance and work. In the organization wrong doers get punished and the staff rewarded for the good performance in terms of the salary.

5.4.1

HR policy preferably Annualized

It is suggested that JKS should help the MFI develop a well-articulated HR policy, which is well disseminated as well within the organization. A written form of the policy would be more preferable. The policy should motivate the staff and make available enough space for them to grow, not just in terms of remuneration but also in their professional and personal capacity. The different functions should be clearly elaborated with as less overlapping as possible. The policy must include the transparent remuneration, which is explained in such a way that it is easy to comprehend. It should have the element of fairness inbuilt. It should be such that the people are motivated to perform better each time. It should also have a clear reward system in the form of incentives so that merit from whichever quarter in the organization gets rewarded and the organization in future itself becomes a quality performer.

5.5 Management The management of the organization is headed by Dr. Mukesh giri goswami as President cum Chief Executive Officer. He is having 15 years experience in forest and social development sector at all level starting from grassroots to Chief Executive of the organization. Board members are well qualified and experienced in rural development but experience in financial services is lacking. Although they give utmost importance to the progress of the micro-finance activities and meet regularly and take active participation in decisionmaking, but inclusion of a new person having some handful experience in micro finance as board member will be an appreciable move for the organization.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) Management decisions are delegated to each level but relationship with the board-staff is more consultative. Input from the field staff as well as client are taken into account before finalization is done. Responsibilities and decision-making power are delegated at each level with certain norms set for all level. Administrative manual is in place and updated regularly. Effective teamwork has enhanced the motivation of the workers. This was also due to the organized workflow as well as good co-ordination between individuals at different hierarchical levels. The support system of the organization is playing an important role in effective performance. 5.6 Interface with external environment

The JKS till now has not got any collaboration with any financial institution and APEX bank. The organization plays a lead role in mobilizing the community and has a good presence within the operational area. There is an urgent need of having collaboration with institutions for training & capacity building as well as financial support agency. To facilitate micro finance to the community in a proper manner possible collaboration with Livelihood and technical organizations should also be explored. This would help them in getting an edge over the other existing micro finance institutions in their area, and would give the recognition to the organization as a Livelihood Promotion Organization and not merely a micro Finance Institution. The organization plays a lead role and shares its resources with other organization making its networking strong. Has a good collaboration with the government and implements government projects. Has a strong network with apex financial institution such as HDFC, SBI etc for financing their project. 5.7 Micro finance program performance 5.7.1 Observation: The organization does not have a separate Microfinance program. However the staff including the senior management agrees that they need to consolidate the SHGs promoted till now under one umbrella and take them ahead in a focused and systematic manner. The SHGs promoted under the various projects were found to be motivated and regular in terms of meetings, savings and loan repayments. Training on SHG norms, and leadership as well as on income-based activities are provided to the clients (SHG members). There is clearly a need for standardizing the operating procedures to ensure better implementation and monitoring of the program. The SHG records are maintained by group leaders in mature groups and checked by staff during their visits to the village. It was observed that the book keepers (SHG members/leaders) need more inputs on SHG record keeping. They need to be monitored more efficiently through mandatory routine checks or periodic audits. Respective project coordinators prepare the SHG reports monthly, quarterly or sixmonthly depending on the requirements of the respective projects. Data consolidation on - 30 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) SHG performance is limited to number of groups, membership, total savings generated and loans outstanding. The Information system needs to be more comprehensive and standardized to enable tracking of critical financial indicators such as savings rate, repayment rate, overdue, defaults etc. and thus contribute more effectively to decision making. There is a need for introducing strategic planning for microfinance programme including expansion through SHG formation, loan disbursements, recovery, funds requirement from external sources (say bank linkage) etc. Micro-finance is the priority of the organization as it leads towards achievement of its mission. It also fits perfectly into the micro enterprise development work; they also understand the importance of financial intermediation for livelihood promotion. Staff are aware about the operating system but it is not there as a documented manual form. There is an absence of need based financial products development, which meets the demand of clientele. Well-developed manual information system is in place for collecting and analyzing data. Trained personnel put the transaction to process. The manual MIS helps to track the portfolio health and address the internal control requirements but based on personal interest and trust. Audit is done externally at organizational level at defined periodic intervals by the reputed charted accountant firm but internal audit system for the microfinance activities is lacking and needs serious attention. As far as development program sustainability is concerned there is a diversified source of funding. The client and organization have good relations and they have a long-term program. The organization also is very capable of taping local funding. The concept of OSS and FSS is new for the organization and orientation of the management in this regard is lacking. 5.7.2 Recommendations

5.7.2.1 Operating System JKS needs a sound operational system as a priority for the organization, which can adequately support the operations and the volume in terms of outreach spread. Hence it is suggested that JKS should devote time and resources to design and develop a good operational system for the NGOMFI with the following sub-systems. Good information flow systems insuring correct and timely information at all levels because it influences all the lending processes right form appraisal to follow up and monitoring. Besides it is important for the management to track the portfolio health and take corrective action in time. Well-defined operations policy preferably laid down operations manual for reducing overlaps and ambiguities situations and positions and to brings more clarity in roles among the different members of the team and more importantly makes decision making faster and more objective at all levels. The operational policy written down in - 31 Prepared By: BASIX Consulting and Training services Ltd.

Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) the form of an operational manual acts as a guide book and reference material to the operational staff who are expected to fully acquaint themselves with the manual. The cluster managers of the JKS should be entrusted to develop the first draft of the operations manual that can later be refined by the senior management of JKS. An operational manual should define clearly: The credit policy of the institution The financial products and channels The lending processes to be followed The monitoring processes The roles of various constituents/staff Decision making process Records and their maintenance Rationing of HR and Operational Expenses: Its quite imperative for JKS to objectively look at its HR requirement and should plan accordingly. Undoubtedly, there are overlapping in the responsibilities of the operational staff because of more HR for less works. It is very necessary for the organization to do an assessment of their need and to invest and spend only on those HR who are required. It should also bring an attitude of revenue-based expenditure in its staff. There should be a formal process to let every staff know of their contribution in JKS revenue vis--vis expenditure incurred on them, it could also be done by a business planning cum budgeting. 5.7.2.2 Monitoring Systems

Computerization of MIS and accounts with increased volume of business: There is a need to install MIS software, preferably any good locking system software like FAMIS plus or Delphix NANO. The accounting software should be compatible with the operating system that JKS is working on. Every branch should use the software, and consolidation should be done at the central office. Training of the operator should be done to not only handle this software, but also understand the basics of MIS for microfinance. Further, the senior management needs to be trained adequately and take some relevant exposure to other MFIs to learn how to analyze reports MIS and take decisions. 6 Proposed Capacity Building Plan

Janmitram kalyan samiti is now collaborating with BASIX Ltd. for capacity building support for this project. The capacity building is been done through exposure visits, trainings, workshops and hand holding support to the core team of JKS, on MFI form and functions etc. The proposed action plan under this project will be carried out with support from BASIX. The following activities will be undertaken during the project period.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) A. Formation of core team for Micro Finance Specific human resources should be allocated for the project, which can either be recruited or deputed from the existing resources. One Manager Operations (micro finance) with relevant experience of institutional promotion and having basic financial and documentation skills should head a team of 5 coordinators and the field staff. B. Orientation on Micro Finance principles and concepts The core team would be provided Orientation training on basic principles and concepts of Micro finance, so that they are able to appreciate the need for commercial perspective in designing and managing the program. This Orientation would build the base for all future capacity building inputs to be provided to the team. C. Streamlining of existing micro finance systems The team should be provided inputs for strengthening the management before starting work on full-fledged micro-finance. The following needs to be done in this process: Exposure visit of team to a systematic MF program D. Develop appropriate operating procedure Based on the design of the financial institution, a set of appropriate standard operating procedures should be developed for the program. These procedures and guidelines would include organizational structure of the MFI, services offered credit and insurance, their products, lending system design, norms for recovery, roles and responsibilities, flow of funds etc. These procedures should be commonly agreed and properly documented in the form of an Operations manual. This would be done over a period of three months through a series of brainstorming workshops facilitated by BASIX team. E. Legal Form The MFI legal form has to decide based on the services, volume and outreach of its activities, which complies with all acceptable laws. F. Product Development It is necessary to have different products to cater different needs of their client, which can take care of their risk part also and for that different products have to be designed. The important product could be Insurance Credit General purpose loan to Women Agriculture loan Agri-Allied loan Non Farm Sector loan Enterprise loans

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) G. Business Planning A financial and operational business plan for these institutions has to be prepared at branch level and head office level. H. Conduct specific training programs for the microfinance team The designing of operating system and MIS can be done through a longer handholding process. Apart from that, the Micro Finance team will need focused formal training in the following areas: S No 1 Topic Participants

2 3 4 5

Orientation to the design of MICRO Whole team FINANCE program (following the design workshop) Product development Project coordinator, Branch supervisors Accounting and financial management for Accountant, Project Coordinator, MFIs Branch supervisors Business planning CEO, Project Coordinator, Branch supervisors, accountant and computer operator Introduction to Insurance Whole team I. Expected Outcome The MFI fully operational and reach to its sustainability within 1 years time. The systems for providing financial services credit and insurance will be developed, tested and standardized along with technical assistance to its customers. Computerized Management Information System with staff trained in operation, analysis and application. Linkages with lending institutions established. Capacity of Board geared up for decision-making and management of staff.

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG)

7. Critical observations which not covered in above structure: The organization started working with forest related issues and later in to NTFP and forest/ agriculture based enterprise development. While working for enterprise development the financial service seems necessary component to promote rural enterprise in large scale and for that the idea of extending financial services has emerged. Once they start financial service there would be need to have separate team for financial service operations. The only criteria, for having a staff on the pay-roll of the NGO-MFI, should be their capability and experience. No subjectivity should dominate the required objectivity of recruitment decision. Preparation of operational manual and HR manual. Policy regarding internal control and delinquency management should be developed and followed. Developing financial linkages should be considered as of highest priority. MIS-Manual system, collecting and compiling information as per organizations requirement. No regular reporting and analysis of SHG performance. Team Commitment level is very high. Good communication environment is in the organization between field staff and management. Work culture is good. Team member are actively participating to achieve the goal. No proper orientation of microfinance system to their field staff. JKS is having good hold in the community and working in a rural area having good microfinance potential. The organization structure although laid on papers is not functional The proposed operation area of JKS is having low density and adverse geographic condition which will lead to high operation cost and strong monitoring mechanism to control risk and other hazards (natural/ manmade)

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Joint Initial Assessment Report of Janmitram Kalyan Samiti, Raigarh (CG) CONCLUSION Based on the above mentioned findings and recommendations of the Joint Initial Assessment study looking at the six elements of the organization i.e. Mission, Structure, Activity, Human Resources, Management and Interface with Environment and its effects on the Micro-finance program performance of JKS, a one day CBNA workshop is recommended. This workshop should be attended by all senior management of the organization, so that they assess the findings of the report and discuss to take decisions thereon. It is envisaged that a final shape of its micro finance program an action plan for future course of action with a long term perspective to attain its mission and strengthen its system for micro finance will be the possible outcomes of this workshop. ===========

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