FAQs

  • What is microfinance?

    Microfinance refers to a variety of affordable financial services that target low-income clients, living either on or below the poverty line, particularly women. It aims to empower these clients by providing them access to microcredit for income-generating activities, savings and insurance, and remittance services.

  • What is a Microfinance Institution (MFI)?

    A Microfinance Institution (MFI) is an organisation that provides microfinance services such as microcredit and insurance services targeted to the poor. All MFIs share the common characteristic of providing these services to a clientele who are otherwise excluded from formal financial services.

  • How is Svatantra different from other MFIs?

    Svatantra is one of the fastest growing MFIs in India. It is the first institution to receive the NBFC-MFI license which was introduced by the RBI in 2012. It is also the only institution that makes 100% cashless disbursements. Svatantra offers one of the lowest interest rates in the industry. Unlike other MFIs, innovation forms the core of business processes and is used as a tool to drive, optimize as well as expand business.

  • What is financial inclusion?

    Financial inclusion or inclusive financing refers to delivering financial services at affordable costs to sections of disadvantaged and low-income households in society who are otherwise unable to avail formal financial services.

  • Who are microfinance clients?

    Microfinance clients are either below or above the poverty line who otherwise do not have access to financial services from formal financial institutions such as banks. They may reside in either rural or urban areas but due to lack of proper documents or insufficient collateral security, are unable to utilise banking facilities.

  • Why is microfinance important for rural women?

    As rural women are more subjugated to discrimination, microfinance aims to improve their status within the family and community by giving them access to financial services. Women availing microfinance activities tend to be more assertive, confident, own more assets and play a stronger role in decision-making.

  • What is the rate of interest charged on the loan?

    Svatantra Microfin Pvt. Ltd. offers one of the lowest interest rate in the country vis-a-vis its peers. The new interest rate of 21% was effective from 1st September, 2019.

  • What is the recruitment process at Svatantra?

    What is the recruitment process at Svatantra?

    1. Identify Vacancy
    2. Prepare Job Description and Person Specification
    3. Publishing of Vacancy & Sourcing of CVs
    4. Managing the Response
    5. Screening & Short-Listing
    6. Arranging for Functional Interview of Shortlisted Candidates
    7. Decision Making
    8. Reference Check (Except from Current Employer)
    9. Compensation Fitment
    10. Offer Roll-Out
  • What is the total loan portfolio of the microfinance industry?

    At the end of 2018-19, the microfinance industry in India had a total of 3.17 crore clients with a gross loan portfolio of 68,207 crores. The industry itself had grown by 47% over the past year.

  • What is the criteria to get a loan?

    Clients must meet the following criteria to avail a loan:

    1. Client should not have borrowed from more than one other MFI
    2. Clients total indebtedness should not exceed 1,00,000
    3. Client should have an income generating activity
    4. Client should have documents (ID and address proof)
    5. Client should have a bank account
  • Are microfinance institutions regulated?

    Microfinance Institutions in India are regulated by the Reserve Bank of India through its master circulars pertaining to NBFC-MFIs. Based on the RBI Circular No: DNBS (PD) CC No: 395/03. 10. 38/2014-15

  • Why are the MFIs interest rates higher than traditional banks?

    Interest rate in MFIs tend to be higher than loans from traditional banks because small loans tend to be more expensive to process than larger ones (as offered by traditional banks). Moreover, MFIs loans are collateral free and require a more hands-on and time-intensive assessment to determine the creditworthiness of a potential client. Microfinance clients tend to reside in remote areas and since MFIs travel to clients, there is also a high cost of operations which is also reflected in the interest rate for MFI loans

  • What Customer Protection measures exist for clients?

    Concerns about negative impact of excessive interest rates, abusive lending practices and over-indebtedness and high multiple lending among poor borrowers have all led to the greater attention given to responsible financial practices and developing Client Protection Principles. The three main aspects of these are as follows:

    • Customer Protection, Regulation and Supervision to ensure customers are treated fairly and appropriately and that they understand the implications of their actions
    • Improve standards and codes of conduct with an emphasis on consistency
    • Financial Literacy training to make clients more informed so that they can become more responsible for their own financial welfare.
  • Can you share more details on the Mediclaim?

    The company offers affordable and comprehensive Mediclaim to its customer in partnership with a reputed third-party insurance company. This is one of a kind product offered by Svatantra and till date the company has settled more than INR 9.8 crores claim. The product is tailor-made to the entire family of 5, including the client, parents and parent in-laws of the rural household.