Research on bossism and cultures of debt and credit in North India influenced significantly the work of the social enterprise Village Invest UK through the design and trialling of an alternative social financing product: EDRAF (Ethnographic Driven Risk Analysis Framework). EDRAF is a novel instrument to assess and minimise risks in the social lending/impact investing sector and generate measurable impact in rural South Asia.
The tool is composed by:
a) research toolkit to assess political, economic and social risks for social financing in rural South Asia;
b) A mobile software application for android to collect and map households’ debt and credit histories in joint/extended family systems and monitor and track impact.
By innovatively taking into account indigenous understandings of risk and ethnographically informed socio-political analysis of over-indebtedness, EDRAF provides accurate and fairer assessments of households’ credit worthiness in rural South Asia and beyond. Its application is improving access to loans and business opportunities for low caste/communities members (mainly women with limited or not collaterals) and helping to reduce vulnerability to loan sharks in rural North India.
We have identified key competitors as well as market size, target audience and segmentation of EDRAF. Potential users are the following:
- Government departments implementing programs through community institutions - to build a baseline of their programs and assess their effectiveness/impact; to design new programs
- Banks and other lending institutions operating in rural areas – to conduct credit rating of potential borrowers based on financial and non-financial parameters and measure the social impact of their investments.
- Peer-to-peer lending platforms working with farmers or in rural/semi-rural areas
- Umbrella farmers’ organizations and other value chains, community financial institutions, like Federations of Self-Help groups, credit and savings organisations, financial cooperatives – to facilitate access to finance for their members; to assess impact of their loans; to monitor quality of their institutions; to conduct capacity gap assessments.
