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How Rang De Is Tailoring Credit Solutions For Financial Inclusion

In the Indian economic landscape, timely credit plays an important role in the growth of business and enterprise, especially the rural economy. About 40% of Indians do not have access to formal financial services with the unavailability being mostly prevalent in rural areas. Affordable credit serves as a lifeline for farmers, artisans, and nano entrepreneurs, empowering them to sustain their livelihoods and navigate economic uncertainties. 

The focus of the government on boosting the economy through Rural Credit facilities has predominantly anchored agriculture and allied sectors. However, only 41% of farmers have access to formal credit, still relying heavily on informal sources.

Need for Credit: Bridging aspirations with access to credit

Among the various challenges faced by unbanked communities include poor banking infrastructure, lack of credit history, high interest rates and need for immovable collaterals against loans. 

The diverse livelihood activities across India require a tailored credit approach, considering their community’s unique needs and challenges. Rang De is ensuring access to affordable credit for underbanked communities, unlocking their immense growth potential through tailored credit solutions.

Addressing diverse loan needs

Rang De offers credit solutions customised to different livelihood activities like farming, animal husbandry, rural enterprises, artisans, education as well as services like transport, hospitality and domestic workforce. These loan products ensure not just affordable credit to the investees but they are structure to ensure timeliness and efficiency as well. 

Rang De has disbursed more than 21,000 loans, understanding the livelihood needs, financial requirements, socio-economic conditions of the family and climate pre-conditions of the region allowing borrowers sufficient time for repayments.  Here’s a look at the different loan types made possible through Rang De - 

Farming loans

Farming loans are primarily used by farmers to fulfill pre- and post-harvest credit needs which include purchasing seeds, fertilizers, tools, pesticides, irrigation, storage, working capital, and transportation of produce. 

Loans for Animal Husbandry 

Loans for animal husbandry are utilized by borrowers to purchase livestock such as cattle, poultry, pigs and goats, or to invest in fodder, sheds, and veterinary care. 15% of all the Rang De loans  have gone towards animal husbandry livelihood activities. This has enabled more than 3000 rural entrepreneurs, men and women, from across India to purchase livestock, quality feed and upgrade infrastructure for better animal husbandry practices.

Loans for Rural Enterprises

After farming and allied activities, the loans with maximum uptake have been loans for rural entrepreneurs helping their small-scale businesses to start or expand. This includes credit for businesses like retail and apparel stores, beauty parlors, embroidery units, food and food product stores, grocery stores, repair stores, etc. Apparel and retail stores have the highest loan requirements and uptake comprising 63% of the total different businesses. 

Artisans Loans

Artisans include the handloom weavers and craftspersons across India engaged in making handicrafts across India. Handlooms and handicraft businesses can be capital-intensive due to the high cost of raw materials and also risky due to the number of processes involved. To ensure resilience, sustainability and survival of languishing artforms, Rang De has including working capital loans for specific partnerships.

Other loans

There are other significant businesses which also need financial support and access to credit. 5% of the total number of loans through Rang De have provided credit to hospitality workforce, professional services, transportation services and other such nano- enterprises. 

The spectrum of credit reflects the diverse needs and socio-economic realities of the communities. While formal credit institutions and government-sponsored schemes strive to enhance financial inclusivity, informal credit sources continue to serve as fallback options in underserved regions. A holistic approach like Rang De ensures these diverse needs get the best possible credit support to help these enterprises flourish.

You too can invest with Rang De and enable access to loans to our farmers, rural entrepreneurs and artisans at - create impact and help unlock their full potential, driving prosperity in India.

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