Janmitram Final JIA Report PDF

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

J oint Initial Assessment Report

Submitted to

Janmitram Kalyan Samiti (JKS)

Plot No. 74, Kelo Vihar

Raigarh (Chhattisgarh) Ph. 07762-220083

E-Mail: [email protected]

Website: www.janmitram.org

Submitted by

BASIXEquity for Equity

Bhartiya Samrudhhi Investment and Consulting Services, Ltd.8-2-596, C-2 to C-5 IInd Floor, Ascent towersOpp. K arvey house Road No. 10 Banjara hills,Hyderabad-500034, Andhra Pradesh, India,

www.basixindia.com

July 2010

- I- Prepared by: BASIX Consulting and Training service Ltd.
mailto:[email protected]://www.basixindia.com/http://www.basixindia.com/mailto:[email protected]


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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

- 2- Prepared by: BASIX Consulting and Training service Ltd.


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Index

Summary of Assessment.05

Key information of organization ..07 Executive Summary................................................................................08

1. Introduction1.1.Expected Outcome of the diagnostic study..........................................................10

2. Methodology............................................................................................................10 2.1.Study Framework..102.2.Process Followed..................................................................................................10

3. Assessment ..............................................................................................................133.1.Organization Design.............................................................................................13

3.1.1. Mission.......................................................................................................13 3.1.2. Activities....................................................................................................14

3.1.3. Structure.....................................................................................................15 3.1.4. Human resources........................................................................................163.1.5. Management style......................................................................................183.1.6. Interface with environment........................................................................203.1.7. Infrastructure..20

3.2.Micro finance Performance..................................................................................203.2.1. Information and accounting system..........................................................203.2.2. Management information system...20

4. Status of SHGs program........................................................................214.1.Non financial........................................................................................................214.2.Financial...............................................................................................................22

4.3.Loan process.........................................................................................................235. Observation and Recommendation25

5.1 Mission..25

5.2 Activates....25

5.3 Structure.25

5.3.1 Possible organization forms for ...265.4 Human Resources..................................................................................................27

5.4.1 HR policy preferably annualized..................................................................295.5 Management...........................................................................................................295.6 Interface with external environment......................................................................305.7 Micro finance program performance.....................................................................30

5.7.1 Observation...................................................................................................305.7.2 Recommendations.........................................................................................31

5.7.2.1 Operating System.................................................................................315.7.2.2 Monitoring Systems.............................................................................32

6. Proposed Capacity Building Plan.....................................................................32A. Formation of core team for Micro FinanceB. Orientation on Micro Finance principles and concepts



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C. Streamlining of existing micro finance systemsD. Develop appropriate operating procedureE. Legal FormF. Product DevelopmentG. Business Planning

H. Conducting specific training programs for the microfinance teamI. Expected outcome

7. Critical Observation.34

Annexure 1 Summary of Joint Initial Assessment....................................................

Annexure 2 Snap Shot of Proposed Capacity building plan .



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J oint Initial Assessment ReportFor

J anmitram Kalyan Samiti, Raigarh

Summary of Assessment

Name of Ogganigation Janmitram Kalyan Samiti (JKS), Raigarh(CG)

Area of Assessment Max.Score

Score % Score Observations Summary

Organization Design 260 173.5 66.73%

Mission

20 13 65.00%

JKS mission is clear to the BoD, & Mgt.but there is need for orientation to otherstaff and field team.

Activities

20 17 85.00%JKS activities are very much supportingthe organization mission

Structure

100 64.5 64.50%

JKS, HR structure well define.Role & responsibility is clears.Direct contact with higher authority bystaff. There is need for power delegationto subordinates at different level of work

Human Resources

40 30 75.00%

JKS has trained rural developmentoriented team at higher and middle level.There is need for orientation and trainingat field/ cluster/ village level staff onquality services and time management.

Management Style

40 29 72.50%

JKS has followed Democratic pattern and

seek inputs from staff in decision making.At all level. They yet to be hire mFprofessionals for managing proposed mFoperation.

Interface with Environment

40 20 50.00%

JKS have good linkages with localgovernment and national ruraldevelopment Programmes. They need tobuild collaboration with Banks and otherfinancial service providers for smoothmicrofinance operation.



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Microfinance ProgramPerformance

120 40 33.33%

Micro-finance is the emerging demand ofJanmitram ultimate clients/ SHG as itleads towards achievement of its mission.It also fits perfectly into the microenterprise development work; they alsounderstand the importance of financial

intermediation for livelihood promotion.Staffs are aware about the operatingsystem but they are not aware and havenot taken any training about this. FinancialPerformance needs significantimprovement.

Client Feedback

20 17.2 86.00%

As per client feed back assessment JKS isfocused to Rural poor empowerment.Client accepts There economic conditionsare much change in since past five years.The SHGs loan sanction procedure isvery simple.

GRAND TOTAL

400 230.7 57.68%

Date of Assessment: 9-10th J uly 2010



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Key Information

Full Name ofOrganization J anmitram Kalyan Samiti (J KS), Raigarh (CG)

Registered under Societies Registration Act ofChhattisgarh1973,

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 31-03-2007

Present L egal Status

Our PAN No: AAAAJ2306F

Address forCorrespondence Indian school road, Kelo vihar plot No. 74 Raigarh (CG)

Telephone Number(with STD Code) 07762- 224379 & 07762 220083

E-mail [email protected], [email protected]

Website www.janmitram.in

Contact Person withMobile Number

Dr. Mukesh giri goswami (CEO) Mob: 098261-44243

Mr. Manish singh (Secretary) Mob: 09826187810

Geographical Coverage ofSHG & mF Programme

All Bilaspur Division of Chhatisgarh

Outreach(SHGs/Members)

736 Groups

J IA Study Team

J anmitram kalyan samitiDr. Mukesh giri goswami, Manish singh, Ramakant,Rakesh kumar, Ravikant meena and Mrs.Uttaravali

BASIXMr. L.M.Tiwari (Sr. Mgr.) & Santosh patel (Asst. Mgr.)

mailto:[email protected]:[email protected]:[email protected]:[email protected]


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EXECUTIVE SUMMARY

J anmitram Kalyan Samiti (J KS) is the sole technical, non-government, non-profitorganisation 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 operatingwith 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 inbank 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, entrepreneurialskill 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 hasfloated 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 anyproduction 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 workingto create self-employment in the rural population by multidimensional approachesJanmitram Kalyan Samiti has been providing income-generating opportunities bypromotion of Self Help Groups to take up Lac Cultivation and processing, Fly Ash Bricks

manufacturing and other income generating activities. Presently JKS has approx 430SHGs 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 itsseparate entity J anmitram Marketing and Consulting Ltd. (JMCL) which is aconsultancy 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 alsolaid foundation ofRISA and J ISAD. RISA- Raigarh I ntegrated Shellac Association isgoing to be a section 25 company, made by self help groups that participate in their lac

cultivation program.J ISAD- J anmitram Institute of Skill and Development is a new division in janmitramsolely concentrating on vocational training of youth. Beside it shall also work for

capacity building of PRIs.



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JKS board requested to BASIX for extending support for strengthening their micro-

finance operations, developing appropriate monitoring and control systems, along withthe 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, Organizationaldesign, performance, organizational climate, Stake holder, and customer satisfaction.

The process followed for the assessment was highly participatory and inclusive. Bothprimary 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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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 is5 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 bypromotion of Self Help Groups to take up Lac Cultivation and processing, Fly Ash Bricksmanufacturing 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 almostwind 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 J anmitram Marketing and Consulting Ltd. (JMCL) which is aconsultancy 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 ofRISA and J ISAD. RISA- Raigarh I ntegrated Shellac Association isgoing to be a section 25 company, made by self help groups that participate in their laccultivation program.J ISAD- J anmitram Institute of Skill and Development is a new division in janmitramsolely concentrating on vocational training of youth. Beside it shall also work forcapacity 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 Micro-

finance Program to all the beneficiaries reached. They requested BASIX for extendingsupport 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 tocollaborate as per the understanding our personal discussions, details of which are given

below.

1.1Expected Outcome of the J oint I nitial 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 studywill be an agreed action plan whereby JKS and BASIX Ltd. may continue to work

- 10- Prepared by: BASIX Consulting and Training service

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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 Climated. 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 servicesin the area and their relative position).

2.2Process 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 andsenior management from Office were taken.

The process followed during the study is outlined below:

Steps DetailsCollection of background information(See Annex 1 for completed OperationalInformation Datasheet)

Collection of information on the organization mission, activities, area of work,

infrastructure, organizational structure, human

resource, information system, funding andother collaborations and details of SHG

program.


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Client Feed Back Framework Client feedback on Group dynamics,Meetings, delivery of services, Needs,

Products & the Impact

Visit by BASIX staff Mr. L.M.Tiwari, Sr.Manager Institutional

Development Services, Mr. Santosh Patel,

Asst. Manager-IDS visited both office andfield to interact with staff and SHGs

members.

Discussion with staff concerned withNawa anjor program

Present systems of SHGs promotion andmanagement, problems faced and need for

improvement.

Visit to SHGs Visit to SHGs to gauge the level of

motivation, awareness, Leadership, group

discipline, meeting their needs in groups andlooking at their record keeping.

Organizational climate assessment. Staff feedback on organization work

environment, level of decentralization,coordination and teamwork, and motivation.

Discussion with senior management 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.

Consolidation and Report Preparation


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The whole process was conducted for two days. The Joint Initial Assessment study visit

followed the schedule given below:

Days/ Timing Activity/ meetings to be undertaken BASIX team With

Day 1: 09.07.2010

9.30 to 11.30 Meetings/ discussions:

BASIX team will brief about objective of2/3 days visit for JIA and possibility of

collaboration with NGO/CBO by BASIX

team and same time final scheduling of 2days work with organization

NGO functionaries will start with historyand establishment process (path of

development) of the organization whichincludes key projects, promoters and their

contribution to the organization.

Detail discussion on all ongoingassignments, projects, their coverage,

management, HR status, methodology ofimplementation.

Chief functionaries of NGO/

CBO/ Branch head, Project

unit head, board members,key HR

11.30 to 13.30 Deep discussion on only Livelihoods/ SHGand MF related assignments which includes

objectives, scope, methodology, current

status, geographical coverage (operationalarea mapping exercise) , and future

planning.

Key functionary and

Livelihoods/Federation/

SHG and Microfinance staff

14.30 to 18.00 Operational area visit to village / SHGs orultimate clients in one/ two location (NGOshould categories the whole livelihoods/

SHG and MF intervention in to threecategory (average, good and poor) and plan

visit accordingly.

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 orultimate clients in another location (NGOshould categories the whole livelihoods/

SHG and MF intervention in to threecategory (average, good and poor) and plan

visit accordingly.

With Junior staff and fieldworkers ( not necessary toinvolve Chief functionary)


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12.00 to 13.30 A quick feedback by BASIX team on fieldvisit (cover both positive and negative if

any) to the NGO and staff: carefully takeexplanations / clarifications by staff and

NGO.

Key functionary and

Livelihoods/ SHG andMicrofinance staff

14.30 to 16.30 Presentation by BASIX team on overviewof SHG and MF in India and its role in

poverty eradication to the team

(clarification on MF and SHG relatedissues)

Key functionary ( not

compulsory but if he / she areand Livelihoods/ SHG and

Microfinance staff

16.30 to 18.00 Conduct the Organizational climate surveywith staff other chief / head of NGO/ Unit

ALL staff NGO/CBO

3. Assessment

The summary of assessment being presented in this section is based on the joint initialassessment framework mentioned above. The assessment constitutes of two parts

I. Organizational designII. Program performance

3.1Organization Design

3.1.1 Vision of the organizationTo intervene among backward and disadvantaged communities by rising awareness and

skill to make them enable for recognizing better opportunities offered by our greatdemocratic nation.

Mission of the organization

Improving health and educational status for women and children.

Improving economic status of ST/SC and Marginal sections of societythrough employment generation, Skill development, and liaison for capital

arrangement.

To institutionalize services in unorganized sector and Introducing Proventechnologies and ideas for better living.

Conservation and management of natural resources through peoplesparticipation.

Strengthening community organizations, local bodies, and Panchayti RajInstitutions for effective self-governance.

Advocacy for Human rights and people's initiatives for social justice


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The Major Areas of intervention:The major area of intervention is follows.

Enhancement of livelihood status of the tribal area of Chhattisgarh throughincome generating activates.

Socio economic development through enhancement of agri. Productivity,Biomass regeneration and conservation.

Skill development of youths and PRIs

3.1.2 ActivitiesThe organization has focused undivided attention and expended tremendous effort on the

social and economic issues faced by the rural families in an integrated manner withTribal, 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 Lailungablock (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 SHGsunder 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 andsemiskilled 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 fromILRI (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. DRDAaffiliated 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 inTapkara 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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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. Ourinvolvement 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 ledthe 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 isone of integral part of our mission. We recognized womens empowerment potential

though Pancahyat Raj Institutions in early days. We conduct training for PRIrepresentatives 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 ruralfinance 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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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 inJ KS are working since start of the organization. The seniormanagement and some middle level staff have assimilated the mission of the organizationvery 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 theirmicro 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.


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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 instaffs 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 budgetsSome 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 thequantitative 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 well-structured information flow from ground level to HO. Every month staff meeting

conducted in Head office and all staff submitted project progress report to concernproject 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 theinterfaced 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 theprinciple 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 oradvertisement 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 86Temporary staff 100 approx Professional (For training) 9 (Sericulture, medicinal plant, Lac

cultivation, Bio fertilizer, Herbal medicine,

Mushroom cultivation, etc.) Consulting 15 (Forestry, Doctors, engineers, legal

advisors, CA, computer experts


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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 socialsector. 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 isactive 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. Electionschedule 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:-

Experience in YrsSl

No

Name Designation Place of

Residence

Qualificatio

nin Rural

Developmen

t

inFinancial

Services

Attendan

ce at past3 Board

meetings

1 Dr. Mukesh giri

goswami

President Raigarh Ph.D., Msc. 15 years 5

years

3

2 Mr. Prakash singh Vice

president

Raigarh MBA 10 years 3

years

3

3 Mr. M.K.Singh Secretary Raigarh Bsc. 10 years 3

years

3

4 Mr. Ravi kant meena Joint

secretary

Raigarh Post

Graduate

8 years 2

Years

3

5 Smt. Mona pandey Treasurer Raigarh PostGraduate 8 years 2years 3

6 Mr. Jivan bhagat Member ofexecutive

council

Raigarh Graduate 8 years - 3

7 Mr. Bharthari jaiswal Member of

executive

council



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8 Ku. Sumati bhoy Member ofexecutive

council


9 Smt. Sevati gupta Member of

executive

council

Raigarh 12th

5 years - 3


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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 nocollaboration 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. Particular Quantity

1 Office building (branch + head office) 2+1

2 Computer set 10

3 Laptop 2

4 Printer 1

5 Digital LCD projectors 1

6 Office table and chairs 25/100

7 Four wheels 2

8 Two wheels 14(Personal member)

9 Training equipments (AV/ DVD) 1 set

10 Training hall with furnished accessories 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. Attendance cum minutes book2. Saving register3. Loan register4. Individual member passbook.

5. General Ledger6. Cash book


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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 Excelto 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 totransaction 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 todeposit 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, andprocess 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 likeAgarbatti making, Community farming, lac cultivation, by few groups.


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Governance and Management: Each group elects 2 leaders who lead the group onissues 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 arenot aware about them.

Meetings: Meetings are held regularly and varies in accordance to the convenience of thegroups 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 maintainedproperly, 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 meetingvarying from Rs. 30/- to 100/- in groups.

Internal-lending:No record has been kept by the organization however it was observedthat 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 fineshave 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 offunds 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 differentgroups.

Interest rate on loans and savings: The interest rate on loans varies from 12 to 18% perannum and is calculated on both declining balances as well as flat balance in different

groups. The group doesnt provide any interest on savings.


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Repayment rate: No track kept by the organization since groups are comparatively newand 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 L inkage: 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 asproductive 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

J KS 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

proposals

Application/

members

SHG meeting

venue

Endorsement by other members of the

group and its leaders.

Appraisal of loan

proposals

Field staff SHG Meeting Personal discussions with the

applicant

Sanction of loan Bank Branch/Unit

office

Taking up every proposal with the

respective field worker and discussing

the need of the applicant and

repayment.

Disbursement of

loan

Bank Bank Cash disbursement or account payee

cheque.

Repayment follow-

up

Field staff SHG meeting

venue

Monthly collection

Withdrawal of

Savings

SHG member 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 onsome important trainings on non farm sector activities.


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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 memberswill update the records. The Institutions are maintaining the following records

InstitutionS. No Records

SHG

1. Cash Book 3

2. Savings Register 3

3. Loans Register 3

4. Attendance register 3

5. Minutes Book 3

6. Member Passbook. 3

7. Other registers -

8. Frequency of

Meetings

Weekly

9. Frequency of data

collection by JKS

Monthly and as per project needs.


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5 Observation & Recommendation

5.1 MissionAs an organization mission statement is very broad and directly supporting livelihood

promotion, which is fairly understood by the senior management and middle managementbut 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 arebelow

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 doingthis.

The JKS has not fully assessed the various risks and costs linked to thedevelopment of new financial products

Organization does not offer insurance services to their customers.

Recommendation: It is strongly recommended to place adequate focus on livelihoodpromotion activities that will directly and positively affect the credit absorption capacity

of the members. A well- conceptualized and planned livelihood intervention strategy isrecommended at the earliest.

JKS needed to Clear demarcation on financial and non-financial activities, and take uponly few components of developments based on own specialization rather thanavailability of projects. And before the product design conduct Client needs assessment.

5.3 StructureExisting 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.


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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 theoperational 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 J KS

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 legalform for JKS.

Table: Comparative Analysis of the Legal Provisions for VariousOrganization Forms

Type ofentities

Not for profit Mutual benefit For profit For profit

1 Legal form Society/Trust/Section 25Company

Mutual Aided Co-operativeSocieties (MACS, only in A.Pso far ),Urban Co-operativeBank(UBC), cooperative

societies

Non Banking FinanceCompany (NBFC)

Local Area Bank(LAB)

2 Purpose Services to others Mutual Help Business Banking Activity

3 Laws underwhichincorporated

Societies RegulationAct,1860 / Indian TrustAct,1920 /CompaniesAct, 1956

AP MACS Act, 1995 or StateCo-operative Act or CentralMulti-State Coop Act

Companies Act, 1956 CompaniesAct,1956

4 Laws underwhich Licensedfor banking

No License provided for RBI license under BR Act,1949 and CooperativeSocieties Rules

Reserve Bank Of IndiaAct , 1934, NBFC Rules

RBI Act 1934,BankingRegulation Act,1949

5 Ownership No Owners in case ofSocieties and trusts.

Shareholding members Shareholders Shareholders

6 Governance By governing Board /Trustees, Trustees notreplaceable.Sec 25 Co. by electedboard of Directors

Elected Board Of Directors Elected Board OfDirectors

Elected Board OfDirectors



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7 Deposits NO in case of societies.Deposits may beaccepted only afterobtaining permissionfrom the RBI. Thecompanies (acceptanceof deposits) rules would

apply.

Coops can accept depositsfrom members. UCB canaccept deposits from generalpublic with the permissionand under supervision of RBI

May accept public termdeposits - minimuminvestment grade,subject to permissionfrom RBI

Can accept anysort of savings

8 Borrowings YES YES YES YES

9 Supervision byRBI

Nil Low to medium (UCBs) Low to medium (due tolarge nos of NBFCs)

Medium to high(yetto 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 goodknowledge 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 donethrough 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 microfinance 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 anindividual. 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 caneither 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 clearlydemarcated. Separate cell for MF operation to introduced and trained, exposed

accordingly.

Training is provided to the Staff after the individual staff needs are assessed. Workculture, 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 theground 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 notclear cut concept of the vision of the organization as well as many other confusions about



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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 memberswhich 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 livelihoodaspects, 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 isstrongly 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, appraisaltechniques, loan sanction and loan disbursement etc.

J ob Description: The job description is not well defined. Most of the work is centralizedto few places. They do not have any decision making authority. Hence s/he must have adetailed job description with suitable authority and responsibility.

Every employee should have a specific and clear-cut job profile. This gives a space to theemployee 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 isinadequate to give the employees a clear picture of their deliverables.

Recruitment Procedure: Recruitment process followed in JKS is very simple. Theprocess 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 theirqualifications, skills with the requirement of the position vacant.

Compensation to staff: Consolidated salary is paid to the staff. Organization shouldmake 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 aremotivated 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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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 professionalgrowth 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 withmany 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 goodworking environment and communication between the staff. The staff gets timely

guidance and encouragement from the mentors. They expressed their freedom of choiceto 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 thesalary.

5.4.1 HR policy preferably Annualized

It is suggested that JKS should help the MFI develop a well-articulated HR policy, whichis 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. Thedifferent 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 besuch 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 itselfbecomes a quality performer.

5.5 ManagementThe 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 ofthe micro-finance activities and meet regularly and take active participation in decision-

making, but inclusion of a new person having some handful experience in micro financeas board member will be an appreciable move for the organization.



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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 beforefinalization 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. Effectiveteamwork 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 ineffective performance.

5.6 Interface with external environment

The JKS till now has not got any collaboration with any financial institution and APEXbank. 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. Tofacilitate 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 notmerely 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 andimplements 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 staffincluding 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 interms 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 bygroup leaders in mature groups and checked by staff during their visits to the village. Itwas 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 six-

monthly depending on the requirements of the respective projects.Data consolidation on



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SHG performance is limited to number of groups, membership, total savings generated

and loans outstanding. The Information system needs to be more comprehensive andstandardized 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, fundsrequirement 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 areaware 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 theportfolio 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 micro-finance 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 SystemJKS 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 systemsinsuring correct and timely information at all levels

because it influences all the lending processes right form appraisal to follow up andmonitoring. 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 manualfor reducingoverlaps 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



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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. Thecluster 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 toobjectively look at its HR requirement and should plan accordingly. Undoubtedly,

there are overlapping in the responsibilities of the operational staff because of moreHR 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 alsobring 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 cumbudgeting.

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 orDelphix NANO. The accounting software should be compatible with the operatingsystem 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, thesenior 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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A. Formation of core team for Micro FinanceSpecific human resources should be allocated for the project, which can either berecruited 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 conceptsThe 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 indesigning 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 systemsThe 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 procedureBased on the design of the financial institution, a set of appropriate standard operatingprocedures 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 theform 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 itsactivities, which complies with all acceptable laws.

F. Product DevelopmentIt is necessary to have different products to cater different needs of their client, which cantake 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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G. Business PlanningA financial and operational business plan for these institutions has to be prepared atbranch 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 handholdingprocess. Apart from that, the Micro Finance team will need focused formal training in the

following areas:

SNo

Topic Participants

1 Orientation to the design of MICROFINANCE program (following the design

workshop)

Whole team

2 Product development Project coordinator, Branch

supervisors

3 Accounting and financial management forMFIs

Accountant, Project Coordinator,Branch supervisors

4 Business planning CEO, Project Coordinator, Branch

supervisors, accountant and computeroperator

5 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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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 enterprisedevelopment 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 betheir capability and experience. No subjectivity should dominate the requiredobjectivity of recruitment decision.

Preparation of operational manual and HR manual.

Policy regarding internal control and delinquency management should bedeveloped and followed.

Developing financial linkages should be considered as of highest priority.

MIS-Manual system, collecting and compiling information as per organizationsrequirement. No regular reporting and analysis of SHG performance.

Team Commitment level is very high.

Good communication environment is in the organization between field staff andmanagement.

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 havinggood microfinance potential.

The organization structure although laid on papers is not functional

The proposed operation area of JKS is having low density and adverse geographiccondition which will lead to high operation cost and strong monitoring

mechanism to control risk and other hazards (natural/ manmade)



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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 isrecommended. 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 forfuture 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.

===========

Documents

Janmitram Final JIA Report PDF