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ASA International India Microfinance Pvt Ltd FYDFI Meeting April 2014

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ASA International India Microfinance Pvt Ltd. FYDFI Meeting April 2014. About ASA. ASA India has been incorporated under the Indian Companies Act and registered with RBI as NBFC (applied for MFI-NBFC ). - PowerPoint PPT Presentation

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Page 1: ASA International India Microfinance  Pvt  Ltd

ASA International India Microfinance Pvt Ltd

FYDFI MeetingApril 2014

Page 2: ASA International India Microfinance  Pvt  Ltd

About ASAASA India has been incorporated under the

Indian Companies Act and registered with RBI as NBFC (applied for MFI-NBFC ).

The company is part of ASA International Group that has operations besides India in Philippines, Pakistan, Sri Lanka, Ghana, Nigeria, Cambodia, Kenya, Uganda, Tanzania, Burma.

Proposed greenfield operations: Sierra Leon, Rwanda, Malawi, Zambia and Cameroon;

Page 3: ASA International India Microfinance  Pvt  Ltd

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About ASA InternationalElements Information

ASA International

Microfinance Investment Vehicle

Established 2007

Registered Mauritius

Organizational Type

Limited Liability Company

Operating Location

Asia & Africa

Fund Allocation

USD 125 Million

Operation Methodology

Greenfield & Equity investment

Operation Strategy

ASA Cost Effective & Sustainable Microfinance Model

Page 4: ASA International India Microfinance  Pvt  Ltd

ASA International - Global Presence

Page 5: ASA International India Microfinance  Pvt  Ltd

ASAI India – Shareholding:ASA

International Holding

ASA International

India Microfinance Pvt Limited

Proswift Consultancy Pvt

Ltd

100%

Eq

uity

75%

Equity

25% equity

Page 6: ASA International India Microfinance  Pvt  Ltd

ASAI India - MethodologyASAI India follows the ASA Bangladesh’s “Low cost Sustainable Model” popularly known as ASA Model. ASA’s cost effective model has proven itself in

different countries in Asia and Africa. Under this model, ASA branches have proved its

capacity to reach a break even point within a year.This model is simple as well as cost-effective. This

cost effective method covering Branch Office to the Central Office ensures ASA’s dedication towards its mission for reducing poverty.

Page 7: ASA International India Microfinance  Pvt  Ltd

ASAI India - ManagementThe Board of Directors of ASAI India have sizable

experience in the field of Banking, Microfinance and the Social Sector with global level exposure.

ASAI India has a professional set-up with experienced personnel at all levels of management.

The strong and professional local Management is also supported by ASA Bangladesh and ASA Netherlands through technical, Systems/IT, Legal , Risk Management, training and administrative inputs.

Page 8: ASA International India Microfinance  Pvt  Ltd

About Proswift Consultancy Pvt LtdCompany registered under the Indian Companies Act.

An Indian Operating Company formed to provide training, consultancy in the field of Microfinance.

Also involved in Financial literacy, marketing of micro

insurance products.

Plans to provide services related to Health, education, training targeting the bottom of income pyramid.

Page 9: ASA International India Microfinance  Pvt  Ltd

Proswift Consultancy Pvt LimitedActivities in India Technical Support to Microfinance Institutions.

Mahasemam Trust, Madurai Vindhyanchal Finlease Private Limited, Lucknow ASA India

TrainingJagaran Microfinance Pvt LimitedGrihastha Finance LtdSamhita SocietyASA India

MicroinsuranceBajaj Life Insurance

Page 10: ASA International India Microfinance  Pvt  Ltd

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ASA India-Operational Areas

Number of BranchesApr’13”

State

West Bengal

91 Fifteen District-1) Darjeeling 2) Cooch Behar 3) Jalpaiguri 4) South Dinajpur 5) Malda 6) Murshidabad 7) Birbhum 8) Nadia 9) Burdwan 10) North 24 Pgs 11) South 24 Pgs 12) Howrah 13) East Midnapore 14) Hooghly 15) Kolkata

Assam 4 One District – KamrupTripura 4 One District – AgartalaBihar 2 One District – KishanganjUP 1 One District – Varanasi

Page 11: ASA International India Microfinance  Pvt  Ltd

Operational Snapshot (ASAI India)Sl. No Particulars As on 31st march 2014

1 States Covered 5

2 Districts covered 19

3 Branches 102

4 Borrowers 84313

5 No of loan officers 250

6 No of total staff 415

7 Portfolio Rs in Crores (Incl interest) 53.25

8 PAR>30 days (%) 1.31%

9 Repayment rate (%) 99.66

Page 12: ASA International India Microfinance  Pvt  Ltd

Note For the Period from Apr'2013 to Feb' 2014

Revenue RsRevenue From Operations 4.1 12,30,11,640Other Income 4.2 64,72,145Total Revenue 12,94,83,786ExpensesEmployee Benefits Expense 4.3 5,88,34,969Finance Cost 4.4 2,12,44,742Depreciation & Amortisation expense 4.5 13,29,096Other expenses 4.6 2,86,63,112Total Expenses 11,00,71,919Profit before exceptional and extraordinary items and tax 1,94,11,867Exceptional Items (Profit from sale of assets)Profit before extraordinary items and tax 1,94,11,867Extraordinary Items 0Profit before tax 1,94,11,867Tax Expense Current Tax Deferred TaxProfit/(Loss) for the period from continuing operations 1,94,11,867Profit/(Loss) for the period 1,94,11,867

ASA INTERNATIONAL MICROFINANCE PVT. LTD.Statement of Profit & Loss for the period ended 28th February, 2014

Page 13: ASA International India Microfinance  Pvt  Ltd

As AtNote February 28,2014

Equity & Liabilities RsShareholders' FundsShare Capital 3.1 1,19,99,900Reserves & Surplus 3.2 39,89,68,430Share Application Money pending allottmentTotal Shareholders' Funds (i) 41,09,68,330Non-Current LiabilitiesLong Term Borrowings 3.3 0Other Long Term Liabilities 3.4 0Long Term Provisions 3.5 25,96,975Total Non -Current liabilities (ii) 25,96,975Current LiabilitiesShort Term Borrowings 3.6 45,00,000Other Current Liabilities 3.7 10,12,57,401Short Term Provisions 3.8 0Total Current Liabilities (iii) 10,57,57,401Total Equity & Liabilities (i)+(ii)+(iii) 51,93,22,707AssetsNon Current AssetsFixed Assets Tangible Assets Intangible Assets 33,17,849 Capital Work in ProgressDeferred Tax Liabilities (Net) 3.9 15,24,690Long Term Loans & Advances 3.10 9,26,732Other Non Current Assets 3.11 1,07,64,449Total Non Current Assets (iv) 1,65,33,720Current AssetsCash & Bank Balances 3.12 2,95,94,620Short Term Loans & Advances 3.13 47,16,29,723Other Current Assets 3.14 15,64,643Total Current Assets (v) 50,27,88,987Total Assets (iv)+(v) 51,93,22,707

ASA INTERNATIONAL INDIA MICROFINANCE PVT. LTD.Provisional Balance Sheet as at 28.02.2014

Page 14: ASA International India Microfinance  Pvt  Ltd

ASAI India Projections - Balance SheetASA International India Microfinance Pvt. Ltd Rs. In lakh

Year ended -> Dec 2014 Dec 2015 Dec 2016 Dec 2017 Dec 2018LIABILITIES Projected Projected Projected Projected ProjectedShareholder Fund 4284.18 4620.88 4976.30 5347.40 5731.16Equity Share Capital(Paid up) 120.00 120.00 120.00 120.00 120.00Share Premium 3063.60 3063.60 3063.60 3063.60 3063.60Statutory Reserve@20%of PAT 259.29 326.63 397.71 471.93 548.88General Reserve@10% of PAT 116.05 149.72 185.27 222.38 260.85Retain Profit 725.24 960.93 1209.72 1469.49 1738.82Less: Prelim exp w/o 0.00 0.00 0.00 0.00 1.00Long Term borrowing 4881.88 5202.35 5946.56 6353.28 7182.64Long Term ProvisionSecured Loan 4871.88 5192.35 5936.56 6343.28 7171.64Unsecured loan 10.00 10.00 10.00 10.00 11.00Loan Loss Reserve 84.87 92.82 99.47 109.04 119.95Current Liability 67.98 58.70 56.98 65.70 66.70Total Liabilities 9318.92 9974.75 11079.30 11875.41 13100.45ASSETSGross Fixed Assets 436.61 531.48 635.85 750.64 876.92Less Depreciation 303.45 319.71 339.23 362.65 390.76Net fixed assets 133.16 211.77 296.61 387.99 486.16Gross Loan Portfolio 8487.19 9282.36 9946.86 10903.70 11994.69Cash & bank balance 318.28 129.61 571.54 360.71 455.58Other current assets 122.24 112.96 111.24 119.96 120.96Investments in TDR) 258.05 238.05 153.05 103.05 43.05Total Assets 9318.92 9974.75 11079.30 11875.41 13100.45

Page 15: ASA International India Microfinance  Pvt  Ltd

ASAI India Projections – Profit & Loss

Year ended -> Dec 2014 Dec 2015 Dec 2016 Dec 2017 Year 2018Particulars Projected Projected Projected Projected Projected

IncomeIncome from Micro Credit oper 2010.85 2456.61 2715.17 3053.13 3353.48 Processing fees 190.36 199.87 223.86 246.24 270.87Other financial income 14.67 23.22 21.42 13.77 9.27 TOTAL FINANCIAL INCOME(A) 2215.88 2679.70 2960.46 3313.15 3633.62FINANCIAL COSTIntt. on borrowings 532.01 567.00 601.97 692.69 783.14Other financial expenses(including processing fees) 32.50 30.00 40.00 37.50 40.00TOTAL FINANCIAL COSTS (B) 564.51 597.00 641.97 730.19 823.14 GROSS FINANCIAL MARGIN (A-B) 1651.37 2082.70 2318.49 2582.96 2810.48Loan Loss Provision 35.68 7.95 6.64 9.57 10.91NET FINANCIAL MARGIN (C) 1615.69 2074.75 2311.85 2573.39 2799.57

Expenses OPERATING EXPENSES Personnel Expenses 789.79 987.24 1135.33 1305.63 1436.19Depreciation 13.55 16.26 19.52 23.42 28.11Administrative & Development Expenses 491.87 590.24 649.27 714.19 785.61Total Operating Expenses (D) 1295.22 1593.75 1804.11 2043.24 2249.91 NET OPERATING PROFIT [C-D] 320.48 481.00 507.73 530.15 549.66Income from other adjustments (E) 0.00 0.00 0.00 0.00 0.00Gross PROFIT [C-D+E] 320.48 481.00 507.73 530.15 549.66Corporate Tax 96.14 144.30 152.32 159.04 164.90PAT 224.33 336.70 355.41 371.10 384.76Dep. Added Back 13.55 16.26 19.52 23.42 28.11Net Cash Accruals 273.56 360.92 381.58 404.09 423.78

PROFITABILITY ESTIMATES ASA International India Micro Finance Private Limited Rs. In lakh

Page 16: ASA International India Microfinance  Pvt  Ltd
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ASA’s Innovation in Microcredit

Flexibility of group formation/No bindings on group guarantee Simplicity and transparent system Low-costs management Standardization Delegation of authority in the field level Innovative staff recruitment and on-the-job (each one-teach one) training Simple and shorter loan processing, less waiting time for the borrower Written manual thereby uniformity and greater control. Strong monitoring and supervision Standard and low cost structure on furniture, fixture and overall

management costs Donors free sustainable growth, high ROA and ROE. Strong IT and Systems-AMMS software covering operational, financial,

MIS and HR. Developed in-house by ASA Bangladesh and used globally across all countries.

Page 19: ASA International India Microfinance  Pvt  Ltd

ASA’s Innovation in Microcredit ASA’s Operating Model distinguishes from many other microfinance institutions through its

standardized and efficient policies and procedures

Exclusively working capital loans for income generating activities Individual client selection, no joint liability, which has the advantage that (i) each

prospective client’s business is more carefully evaluated, (ii) good clients are not penalized by non-performing clients, and (iii) clients are not dependent on group formation prior to first loan

Lending groups are formed in order to achieve and maintain distribution efficiencies in order to maintain weekly client contact and collect installments

Highly standardized lending and control model Centrally controlled policies and procedures combined with decentralized credit decision Rigorous focus on cost control and achieving ongoing cost efficiencies Flexible loan products suited to client’s capacity to repay Graduation principle – good credit record provides access to bigger loans Ongoing focus on improving products and loan protection through various insurance

schemes Rapidly scalable, primarily dependent on the ability to train and maintain experienced staff

Through the application of ASA’s Operating Model, ASA’s and ASA International’s (i) cost/income ratio is comparatively low and return on outstanding loan portfolio is high despite never charging higher interest rates than any of its peers/competitors, and (ii) portfolio quality remains high

Page 20: ASA International India Microfinance  Pvt  Ltd

International Recognition and Awards“Banking at the Bottom of the Pyramid” Award by

Financial Times and International Finance Corporation (IFC) UK (2008)

Selected as the best MFI worldwide by Forbes (Dec 2007)

“The Ford Motor Model of Microfinance” Asian Development Bank

Best International Technical Service Provider for UNDP Micro Start Program in the Philippines and Nigeria

Placed in all the six categories with exceptional best result: MIX Report 2005

Empowerment of Women Award

Page 21: ASA International India Microfinance  Pvt  Ltd

ASA International - Excellent Social Performance Track Record

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Social rating Five star rating by GIIRS (Global Impact Investing Rating System) for second year in a row GIIRS is a ratings and analytics platform for impact investing that provides comparable and

verified social and environmental performance data on high impact companies seeking investment capital

GIIRS now has the largest database of social and environmental performance data on private companies

Out of 219 companies rated ASAI scored highest rating in three benchmark groups (company vs market, market & sector, and market & size)

Social responsible investment ASAI signing up as signatory to the United Nations-supported Principles for Responsible

Investment (PRI) Initiative. The Principles are voluntary and aspirational offering a menu of possible actions for incorporating ESG issues into investment practices across asset classes

PRI Initiative is the leading global network for investors to publicly demonstrate commitment to responsible investment

Social policies and practices ASAI adopted the SMART principles. These Client Protection Principles are the minimum

standards that clients should expect to receive when doing business with a microfinance institution based on consensus in the microfinance industry

ASAI desires to be fully transparent in the pricing, terms, and conditions of all its financial products. It also aims offer the most competitive rates in each of the markets it is active in ASAI promotes the establishment and use of credit bureaus Public reporting ASAI publishes data on mix market

Page 22: ASA International India Microfinance  Pvt  Ltd

Impact StudyASA India – Impact through Microfinance

Client Basanti Sarkar Activity: Papad Manufacturing ASA Group: Deep First Loan Rs.10,000/- Current Loan Rs.12,000/-

Basanti’s success story goes back to 4 years ago when her husband suffered a huge loss in his Saree business. The family was pushed towards scarcity, getting out of such situation became a major challenge in absence of finance.

  She approached ASA India and narrated her situation and sought support. With funding from ASA India she decided

to go into Papad making for her livelihood activity. The activity not only supported her family, provide good education to her children, she could repay the loan as also expand her business. She continued to avail loan from ASA after repayment of the previous cycle.

  Presently her annual turnover exceeds Rs 4 lakhs with annual profits of around Rs 1 lakh.

What started as a small self-employed unit now provides employment to 8 to 10 families in the locality.

“I used to spend sleepless nights worrying about my family and children when my husband’s business failed. ASA has given me a new of life and now I am able to provide my family a good living standard.” 

Page 23: ASA International India Microfinance  Pvt  Ltd

Impact StudyClient Mala Paul Activity: Clay modeling ASA Group: NandiniFirst Loan : Rs. 8,000 Current Loan: Rs. 15,000  “ASA support in addition to the financial security has provided us and our art recognition.”

She is an empowered woman from Kumartuli area of North Kolkata who now successfully running the business venture and assisting her husband to shoulder the responsibility of her family. Her 13 year old daughter could be educated at one of the reputed schools at Kolkata.Apart from the income her talent has been recognized at state and national level through:Various awards, recognitions, cash rewards.A documentary on her talents and achievements, the documentary being selected as 4 th best out of 350 documentary.A contract from Howrah Municipal Corporation for Rs. 1,40,000/- to make clay model depicting scenes from Hindu religious epic Ramayana to be displayed at Bellilious Park.

Life has been a struggle for Mala Paul and her husband Bhanu Rudra Paul before they approached ASA India. The meager Rs. 3000 income was inadequate to make ends meet. Mala Paul approached ASA India, with ASA India’s support activity expanded; orders started flowing-in thereby the turnover and income. She kept repaying the loan in a disciplined manner, again approaching for next cycle of loan. Her business now has a annual turnover of over Rs.4 lakhs with her income more than Rs. 1 Lakh.

Page 24: ASA International India Microfinance  Pvt  Ltd

Thank you