Empowering Financial Freedom for Rural Women at Avani

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A visit to a ground breaking development project in the Kumaon region shows how rural women are eager to learn more about financial freedom.

When we talk of financial freedom for women, we automatically assume that urban women would be the first to comprehend the various financial options available to them. But as I discovered on a recent visit to the Avani community development project located in the Kumaon region of the Himalayan state of Uttarakhand, rural women are actually more keen to learn how they can maximise their investments for a rainy day.

Established in 1997, Avani – named after the Hindi word for Earth – creates opportunities for viable employment through a self-sufficient and environmentally sustainable supply chain. Though both men and women are involved in the activities of Avani, the focus is largely on women, who constitute 85% of the participants in the various programmes, from textile production such as wool, silk, linen, yarn and pashmina to the production of natural dyes, among other activities.

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My visit to Avani was an eye-opener as I saw the resilience of the women who were so dedicated to their work while balancing their duties at home. When I gave a group of women a presentation on the benefits of S.I.P (Systematic Investment Planning) and the wonders of compound interest, they realized how this was a better way of investing than the usual fixed deposits that they were used to.

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“Time, patience and discipline – these are the three mantras you need to follow,” I said in my presentation explaining that taking care of investments was like taking care of one’s health. They found it amusing when I shared that it’s false to think that all urban women are aware about investing despite earning more money than them.

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When I saw how easily they climbed down mountain trails, carrying heavy loads of pine needles on their heads, I used that as an example of how capable they were compared to me who needed help to walk the same mountain paths. “Financial planning is also about negotiating tricky paths,” I told them. “Just like you are aware about the pitfalls and know how to walk mountain paths, you can have a similar approach to ensure your financial planning is safe and fruitful.”

That inspired them to think how they would first set aside even a small monthly sum of just Rupees 200 for their SIP, before they spent on their domestic budgets.
In fact, when I was walking in the forest, I came across some women and started having a general chat about my visit to Avani. Intrigued, they started asking more questions and I ended up giving them a presentation on financial management, right in the lap of nature!

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India’s rural economy is considered a strong growth engine. According to a 2013 Accenture report, since 2000, per capita Gross Domestic Product has grown faster in India’s rural areas than in its urban centres: 6.2 per cent CAGR (compounded annual growth rate) versus 4.7 per cent.
Between 2009 and 2012, spending in rural India reached $69 billion, significantly higher than the $55 billion spent by the urban population.

Clearly, the opportunities for financial planning and empowerment abound in rural India. And as I discovered during my memorable visit to Avani, it is India’s rural women who can lead the way towards financial freedom.

– Namrata B Durgan, Founder, Mirr Investments

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Investing in India Versus the West

InvestingInIndia

How India looks like for overseas investors at a time of global uncertainty, as explained by economics and NRI expert Kul Bhushan.

Dear overseas Indian investor, where will you keep your money safely? In the UK? Really, after Brexit and the emerging economic slide?
In the USA? What with its huge deficit, debt and slow economy.
Perhaps anywhere in the west, then? What about the almost negative rates of interest after you deduct inflation from your returns? Add to that the global political scenario getting bleaker with increased violence.

So let’s face it, India is the best bet right now. In the current global economic slowdown, India is the fastest growing economy with over seven per cent growth.

The passing of the constitutional bill for goods and services tax (GST) on 3 August 2016, marked a historic day in the economic history of the nation. As a major economic reform post the liberalisation of 1991, the passage of the GST bill will finally lead to the realisation of the ‘One Nation One Market’ dream.

Flipkart co-founder Sachin Bansal calls GST ‘Brexit in reverse’ which means that while Britain left the bigger market of Europe, India has created its own bigger single market for goods and services.
This means extra economic growth estimated at between two and three per cent after the bill comes into action which is targeted for 1 April 2017.

“This is India’s biggest single tax reform since independence,” wrote an Indian management consultant settled in the USA.
Simply put, GST is a single tax on goods and service that includes VAT, service tax, central sales tax, excise duty, entertainment tax, additional customs duty, special customs duty, octroi and entry tax, purchase tax, luxury tax, and taxes on lottery, betting and gambling, and many other taxes at the state level.

GST will simplify the taxation system, bringing in more revenues and efficiency. But how does it all impact the overseas Indian investor?
Higher economic growth means better returns for investment. India seems to be at the cusp of a new era of economic growth and development and this bodes well for investors to look at equity investments as a powerful tool for long-term wealth creation.

When overseas Indians deposit their savings in India, they can expect higher returns than in the west.
When they invest in equities or mutual funds, they can hope for even better returns as the market will become more bullish and when they invest in industry, the single market could bring in higher profits.

The real test of GST will however lie in its implementation. The digital infrastructure for collecting GST is claimed to be in place but tax officials will have to be re-trained by April 2017.
If India fails in the proper implementation of GST, then it may result in little or no benefit in economic growth and lower inflation.
But chances are that the Modi government – which worked hard to get GST passed – will make it a success. And that makes India the top destination for diaspora funds and investment.

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Female Leadership + Fintech = Financial Revolution

FemaleLeadershipFintech

The world of finance has traditionally been a male domain but Indian women are smashing through the glass ceiling to emerge as leaders, especially in banking. This management revolution is happening at a time when fintech, or financial technology, is rapidly changing India’s financial ecosystem.

Some of India’s leading banks are headed by women such as Arundhati Bhattacharya (SBI), Chanda Kochhar (ICICI), Shikha Sharma (Axis Bank), Usha Ananthasubramanian (Punjab National Bank), Naina Lal Kidwai (HSBC) and Kaku Nakhate (Bank of America Merrill Lynch India), among others.

This trend is indeed ground-breaking indicating that India is at par, if not ahead, of many countries when it comes to gender equality in banking.

A report in The Quint suggested that some of the reasons why women have made such an impact include their ability to be natural team players, multi-taskers and flexible managers while adding that “women also traditionally tend to be more careful with money”.

Taking an international view beyond banking, a recent study by the Centre for Financial Research at the University of Cologne indicated how women approach financial management. The study indicated that female fund managers switched around their portfolios less than their male colleagues. An analysis on Investopedia offers further insight on “the unique ways women approach finance”.

With women heading some of India’s top banks coupled with the growing impact of fintech, it should be no surprise if the country is heading for a financial revolution. A recent report by KPMG India titled “Fintech in India” states that “the traditionally cash-driven Indian economy has responded well to the fintech opportunity, primarily triggered by a surge in e-commerce, and smartphone penetration.” The transaction value for the Indian fintech sector is estimated to be approximately US$ 33 billion in 2016 and is projected to reach US$ 73 billion in 2020 growing at a five year CAGR of 22 percent.

With banks targeting the millennial audience – India has the world’s youngest population with over 350 million people below the age of 24 – fintech is expected to play a major role in attracting this crucial demographic. Moreover, with 277 million internet users, India has just overtaken the U.S. to emerge as the world’s second largest internet user after China.

In other words, fintech powered with female leadership can give India a unique standing in the global financial market while giving you, the consumer, better options on how to manage your money.

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How Money Seduces Men and Women Differently

MenWomenMoney

If you put the cliche to the test, when it comes to money, men are indeed from Mars while women are from Venus.

According to a recent study conducted by Social Indicators Research, men and women are seduced by money in different ways. The study featured over 100,000 individuals in the U.K. who were surveyed on how they responded to money across various parameters. The study broadly defined four main categories which are associated with money: security, power, love, and freedom.

One of the major differences between the genders was in how women associated money more with love and freedom compared to men. By contrast, for men, more than women, money represented power and security.

Among its many findings, the survey also confirmed the phenomenon of retail therapy for women. Compared to men, women were “worried spenders” – they shopped as a form of therapy and they worried more about money.

It goes without saying that the findings of this survey, which focused on a U.K. sample audience, could also probably offer similar results in India and other countries. As indicated by the study, if women see money as a means to freedom, then the MIRR credo of “Indulgence is Freedom” rings true.