Continued from United Prosperity – The birth of an idea.
At the IIT conference which I attended, I got an opportunity to bounce the idea with several people. As with most IIT conferences, the enthusiasm was infectious and that got me even more excited. I quickly wanted to start validating the idea.
I did not know anyone directly working in microfinance and started looking up my contacts. Meanwhile I explained the idea to Michael Laycock, a colleague of mine at PMI. Michael was a Subject Matter Expert at PMI and we had worked together on a couple of large projects. His knowledge of finance was immense and he was an expert in operations, accounting and business processes with a keen grasp of technology.
‘This is a workable idea’, he said. ‘This is about socially responsible investing, which is rapidly growing. Basically this is about people in the developed world stepping up to their plate and taking some more responsibility. I don’t mind putting some money to help poor but hard working folks in the developing world and I am sure there would be others interested in doing the same thing’. And then very graciously he told me ‘I will help you with this idea if you ever decide to pursue this’. He then went on to explain in intricate detail of how I could apply for a brokerage license to do this or even better partner with a brokerage or bank to make this happen.
I also found out that Prof. Srinivasan, who taught me at management school, was deeply involved in Microfinance. Prof. Srinivasan, had joined IIM Bangalore where I studied, from Institute of Rural Management Anand(IRMA) and already had several areas of experience working with co-operatives and the rural sector in general. I wrote to him about the idea seeking his inputs and validation. His thoughts were that guarantees for microfinance institutions are relatively low risk, but there was always going to be political risk. He mentioned the case of how microfinance lending had halted for several months in the state of Andhra Pradesh in India. I set up time to talk to him and I had prepared nearly two dozen questions for him.
He answered each of the questions patiently and also gave me a detailed overview of the scenario in India. Most of my concerns were also addressed to a reasonable degree.
I had run out of specific questions and also accumulated simply too much information in my head. I finally asked him, ‘What would be your advice?’
‘Just do it’ he replied.
I let all the advice sink in over the next couple of days. I was already thinking how I would go about executing this.
More later, and thanks for stopping by.