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In the western Indian state of Maharashtra, in the Mann Desh region, lives 39-year-old Lakshmi Shellar. She spends a typical day in the field tending to her crops; she also rears buffaloes and sells their milk in the village door to door. A widow since the age of 17, Shellar got in touch with Mann Deshi Mahila Bank, a cooperative bank in rural Maharashtra, a few years ago, where she learned the basics about banking products. Now she runs a financial literacy school by night, attended by 20 women from her village.

Women such as Shellar act as business facilitators to India's banks. Some work directly for the bank, others through banking correspondents (BCs) such as microfinance institutions and nongovernment organizations. Each facilitator is connected to hundreds of people. On behalf of the bank, they create awareness about savings and other products, identify potential borrowers, collect and verify loan applications, monitor borrowers' repayment and follow up for recovery.

Shellar's story is told whenever Duvvuri Subbarao, governor of the Reserve Bank of India (RBI), delivers speeches on financial inclusion across the country. Subbarao hopes more women like Shellar will help to promote banking deep within the country. It will be crucial for an organized financial system to find its roots in rural India.

A December 2009 RBI report, "Financial Inclusion: Challenges and Opportunities," points out that the country has 600,000 habitations -- clusters where the population is 100 or more -- but only 30,000 have a commercial bank branch. Less than half the population has a bank account, with the disparity greater in the northeast. Only about 10% of the people have life insurance, and less than 1% have other types of insurance. A full 37% of the population still lives below the poverty line.

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While billions of pounds have been spent on food aid for developing countries, only a small portion has made any long-term difference to the future economic prospects of subsistence farmers in the world's poorest communities.

"Sometimes in Africa you could feel as though you were just pouring money into a bucket with a big hole in the bottom," says Simon Maddrell, who founded the charity Excellent Development in 2002 with Kenyan farmer and engineer Joshua Mukusya.

Schemes such as sand dams, which provide a year-round source of filtered water, and terracing soil to reduce erosion, repay the community's investment of "free" labour by giving a more reliable harvest of valuable food and dramatically reducing the number of hours individuals spend walking miles to collect clean water.He was determined to ensure the new charity would take a longer-term view by only developing projects at the request of the local community, and that these should be built using voluntary local labour.

"Nothing comes for free," says Mr Maddrell, 44. "It is generally true that people don't value what they are given for free as much as what they have worked for. We want communities to engage with and own the process of the project."

As a result of securing community involvement, benefits can be provided at lower cost; typically, every £1 donated by a member of the public achieves £1.44 worth of improvements, fostering "independence and self-reliance", as Mr Maddrell puts it.

"It is challenging the idea that farmers in Africa are idiots who need to be told how to grow food," he says.

The charity is currently helping 67 community groups in Kenya. By way of example, it says a typical one-year project might see a group mobilised to build a sand dam, dig 4,000 metres of terracing and plant 3,800 trees to counteract deforestation caused by population growth.

The community contribution would amount to more than 2,500 days of labour - digging, building and collecting stones, sand and water. Groups must also provide the food eaten by the workers during the one day each week they are expected to contribute.

Based on the minimum wage for an agricultural worker of about £1 per day, and adding the cost of food, the local input would be worth £6,771.

The cost to the charity of providing technical expertise and imported materials such as cement would come to about £15,255, so almost one third of the total £22,026 cost is met by the recipients.

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Players in the microfinance industry are looking forward to the establishment of branchless banking so that they can reach more people countrywide without the cost of erecting brick and mortar outlets.

The planned changes to the legislation governing the setting up of financial institution branches ,which will allow for the establishment of branchless banking or agency banking, is expected to provide microfinance institutions with a leverage to extend their reach at minimal cost.

"The establishment of branchless banking will allow us to reach more people, especially in the rural areas where the majority are unbanked ," said Lydiah Koros, the chairperson of the Association of Microfinance Institutions (AMFI).

Ms Koros said agency banking will transform the industry by offering financial services through easy -and simple- to -use devices such as point of sale (POS) terminals and at the customers doorsteps .

Current rules on the establishment of branches for commercial banks and MFIs require brick and mortar, steel and glass structures before services can be rendered.

This pushes up the costs of operation as financial institutions are forced to put up structures in order to roll out services.

"The new regulation on agency banking will boost MFIs as we don't have the wherewithal resources to put up branches across the country to match our rapid customer growth base", said Ms Koros who is also the Chief Executive Officer of Faulu Microfinance. This development comes as Kenya prepares to host the Africa-Middle East Micro-credit Summit in April.

The meeting, which will be attended by over 2,000 delegates from over 40 countries from Africa and the Middle East, is expected to show case Kenya's best practice and innovation in offering of microfinance services to the poor.

Its the first to be held in Africa and has received sponsorship of Sh9 million from Craft Silicon, a local leading software solutions vendor.

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The FINANCIAL -- IFC, a member of the World Bank Group, is working with key stakeholders including government, regulatory bodies, private sector developers, and financiers to help make affordable housing available for low- and middle-income populations in India.  

"As part of this initiative, National Housing Bank and IFC are hosting a two-day conference that started today on Affordable Housing and Housing Finance for government officials, regulators, financiers, bankers, housing specialists, and developers.  Issues relating to pro-poor housing initiatives, alternate approaches to affordable housing, and the role of government in securitization of low-income housing are the key themes being discussed," IFC informed. 

Estimates indicate that more than 14 percent of South Asians have no home or live in inadequate housing such as urban slums and squatter settlements.  While the region's housing and housing finance markets are dynamic, they are limited in their outreach, catering primarily to upper-income groups.

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MUMBAI - Mansukh Prajapati invented a first-of-a-kind refrigerator that is made out of terracotta, works without electricity, costs US$53 and is selling in the thousands. It's a sample of an innovation wave from rural and small-town India enriching the world with common-sense products. 

Anil Gupta, a professor at India's premier business school, the Indian Institute of Management, Ahmedabad, leads a pioneering tribe of technocrats working for no-frills change at the mass level, by harnessing knowledge wealth from economically weaker sections of society. 

"Being economically poor does not mean being knowledge-poor," Gupta told Asia Times Online. "But the poor who are at the

    

bottom of the economic pyramid are often considered as being at the bottom of the knowledge pyramid as well. Nothing could be further from the truth." 

To prove the truth that wisdom does not depend on university degrees, Gupta's 21-year-old Honey Bee Network has compiled an unprecedented database of 140,000 innovations created by farmers, villagers and small-town inventors. Many have no formal education or technical training. Teams of Honey Bee volunteers scout across India to hunt out local innovations, inventions and traditional knowledge practices. MUMBAI - Mansukh Prajapati invented a first-of-a-kind refrigerator that is made out of terracotta, works without electricity, costs US$53 and is selling in the thousands. It's a sample of an innovation wave from rural and small-town India enriching the world with common-sense products. 

Anil Gupta, a professor at India's premier business school, the Indian Institute of Management, Ahmedabad, leads a pioneering tribe of technocrats working for no-frills change at the mass level, by harnessing knowledge wealth from economically weaker sections of society. 

"Being economically poor does not mean being knowledge-poor," Gupta told Asia Times Online. "But the poor who are at the bottom of the economic pyramid are often considered as being at the bottom of the knowledge pyramid as well. Nothing could be further from the truth." 

To prove the truth that wisdom does not depend on university degrees, Gupta's 21-year-old Honey Bee Network has compiled an unprecedented database of 140,000 innovations created by farmers, villagers and small-town inventors. Many have no formal education or technical training. Teams of Honey Bee volunteers scout across India to hunt out local innovations, inventions and traditional knowledge practices.  

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Global agribusiness companies are waking up to smallholder farmers. Long used to buying their produce through intermediaries, companies are now meeting farmers in the fields. Cadbury is committed to making its leading Dairy Milk brand Fairtrade by supporting small cocoa farmers in Ghana.

Unilever is offering 5,000 small farmers guaranteed markets, access to finance and technical assistance to grow black soybeans in Indonesia. Blue Skies - a business supplying processed tropical fruits to Europe - is training workers to meet international accreditation standards, increasing exports from Ghana.

This trend is recognised by some of the most senior authorities in the field. Oscar Chemerinski is director of global agribusiness at the International Finance Corporation (IFC), the investment arm of the World Bank. "There is an increased realisation by global agribusiness that their success or failure in the medium and long term is tied to the success of the small farmer, both financially and environmentally." He says: "The balance of power may be shifting in favour of the producer."

The challenges facing smallholder farmers, however, remain high. There are an estimated 1.5bn of them on the planet, but only a tiny proportion are involved in the global food supply chain. Many farmers complain about poor credit access, the burden of risk and international trading standards that they cannot understand or afford to implement. Increasingly, farmers are migrating to urban areas in pursuit of higher wages, letting their farms fall into disarray.

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Soon, low-income families in Kenya will be able to add to their diet a pre-cooked porridge product that is rich in proteins and vitamins and supplies the nine essential amino acids required by the human body.

The porridge will not be delivered under the auspices of an aid agency or a government-funded programme.

Most families will buy it as part of a revenue-based approach to attacking malnutrition.

The market-based approach to malnutrition is something being explored by large companies such as Unilever, PepsiCo and Danone, as awareness grows of the need to address malnutrition - something that affects not only the poorest communities but also higher income populations - and the potential of doing so through for-profit products. However, some believe that there is a role for smaller entrepreneurs in coming up with hybrid models that can address what is often known as "hidden hunger".

It is for this reason that Acumen Fund - a New York-based social venture fund that provides financing to enterprises using market-based approaches to addressing poverty - has invested in Insta Products, a Kenya-based private company that supplies organisations such as the World Food Programme and Unicef with emergency relief food.

"The majority of their revenue is going to come from the big aid contracts," says Omer Imtiazuddin, health portfolio manager at Acumen Fund, which is working on these types of food products with the Geneva-based Global Alliance for Improved Nutrition, a non-profit group that promotes public-private partnerships to fight malnutrition. "But for Insta this could be a significant source of revenue."

The food product Insta is developing - known locally as uji - is particularly well suited to Kenyan tastes, as the porridge is eaten by 80 to 90 per cent of the local population across all age groups and income segments.
The fortified version is badly needed. Many women in Kenya suffer from low micronutrient intake during pregnancy, making it hard to gain the necessary weight for the development of their babies.

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CHENNAI: Owning a dream home for many a poor Chennaiite could soon become a reality with a leading builder, Khivraj Estates, all set to promote a low-cost residential project at Thiruvottriyur, 10 km from the city centre, at Rs 4 lakh per 269-sq ft studio apartment. The project will come up in an area where a 650-sq ft apartment costs at least Rs 15 lakh at present. 
Khivraj MD Ajit Chordia says he embarked on the project drawing inspiration from Tata's Nano Homes and Patrimonio Hoy, a cooperative initiative of Cemex, world's leading building material supplier and the third largest cement manufacturer, started in Mexico in 1998 to provide shelter to 20 million homeless people in that country. In the 11 years of its existence, Patrimonio Hoy has spread to more than 100 centres in Colombia, Costa Rica, Nicaragua and Venezuela providing quality shelters to more than 2.08 lakh families. 

Chordia has acquired a 1.1 acre plot close to Thiruvottriyur railway station, where he plans to promote 100 such dwelling units in the first phase. The bigger apartments, each measuring 485 sq ft, would cost Rs 8.7 lakh though. "Based on its success, we propose to expand it to another four acres abutting the first phase," he told TOI.

He has engaged a team to bring down the cost of construction. "As of now, the overall cost works out to Rs 1,800 per sq ft. But we will bring it down to Rs 1,500 per sq ft at least for our own employees, who buy from us," he said. Hoping that at least 10% of them would opt for the project, Chordia said, "We know about their skills and many of them can do works like interior painting and electrical wiring. By adopting high levels of standardisation and using pre-fabricated material, the cost can be reduced further." 

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NAIROBI, 19 January 2010 (IRIN) - Fridah Awour Agolla has sold vegetables in Nairobi's Mathare slum for 20 years. In better times, her stock sold out every day. But lately market forces have begun to bite even harder for the millions in Kenya who live in such squalid, neglected settlements. 

"My customers are buying less and less; now I find that goods like vegetables do not sell out, they go into the next day. People's ability to buy these goods has really dropped," Agolla, a mother of five, told IRIN. 

Agolla managed to put her children through primary school but never earned enough to pay for secondary education. 

"If I could afford to join a savings club [where members' regular contributions are distributed on a rotational basis], I'd buy a variety of food to improve my stock and I would probably be selling more, and perhaps some of my children could go back to school," she said. 
Pamela Anyango Odhiambo, 25, and a mother of five, says making ends meet gets harder and harder in Mathare. 

"I think food prices have more than doubled within a short time; for example, with 300 shillings [US$4] I could feed my family for days. Now it is not even enough for one day," said Odhiambo, nursing two-month-old twins. 

"Humanitarian crisis" 

Slum-dwellers are among the Kenyans worst hit by high food prices, yet they receive far less humanitarian attention than other demographic groups. The poorest urbanites spend up to two-thirds of their income on staple foods alone. 

"There is a humanitarian crisis in deprived informal settlements around the world, and one of the regions where this dynamic is playing out is in Kenya," said Choice Okoro, advocacy and outreach officer for the UN Office for the Coordination of Humanitarian Affairs-Kenya. 

"Urban poverty is set to be Kenya's defining crisis over the next decade if it is not urgently addressed," she added.

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Before he got a mobile phone seven years ago, Vijay Navle, a small Mumbai fish trader, spent much of his time and scant income travelling on buses and trains.

Every day, he would make the five-hour round trip to visit fishermen living on the Arabian Sea on the north of the city to see if they had caught any of the prawns and large fish that he sells to exporters at south Mumbai's Sassoon Dock.

"I can immediately inform my customers that there's a big catch coming in fresh and we get a better price for it," says Mr Navle.Today, like a growing number of Indians, rich and poor, Mr Navle and the fishermen have mobile phones. Fishermen call him when they catch something and he arranges the pick-up and delivery to customers by phone.

For hundreds of millions of people across India such as Mr Navle, the rise of mobile telephony has led to changes in their lives as profound as the advent of the fixed-line home telephone was for rich consumers in the west.

Aside from television, the mobile handset is the first contact for many Indians with the world of sophisticated consumer electronics and their first connection with the organized modern economy. And with third-generation cellular services on the horizon, the next phase of this consumer revolution is poised to begin with the spread of the mobile internet to India's masses.

"The mobile phone is the first piece of technology that so many people in India will have owned, it's their first communications device and it's their first [mobile] entertainment device," says Kunal Bajaj, managing director with consultancy BDA in New Delhi.

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