In Wired magazine’s provocatively titled “Social Entrepreneurship Achieves What Centralized Aid Could Not in India,” one man’s efforts at providing sustainable solutions for water and health in Indian villages show how economic incentives may be more successful than pure aid.  As a recepient of the $100,000 Lemelson-MIT Award for Sustainability, Dr. BP Agarwal’s Aakash Ganga and Arogya Ghar are initiatives under his organization, Sustainable Innovations. 

Aakash Ganga aims to use rainwater harvesting to address the water shortage in Rajasthan. Through storage of collected rainwater, they are able to provide

an average of 10-12 liters of water per day to each resident of 40 villages, reaching approximately 10,000 villagers so far. The system also creates an economic incentive for villagers to sustain the program, not only by providing water, but by allowing them to rent out their rooftops to those with increased demand for water in order to generate income. Excess water is routed to a community tank that all of the villagers can access.

The Arogya Ghar program employs rural Indian girls, who are given inexpensive laptops that have diagnostic capabilities. These girls essentially act as the first line in medical care.

Carrying the entire unit in a shoulder bag, they travel door-to-door in villages asking if anyone is sick, receiving 25 cents for performing diagnostic tasks using instructions on the computers. This typically creates an income of about $100 per month, says Agarwal, while offering girls, whose career options are usually severely limited, valuable vocational training in the field of healthcare.

What’s interesting about Dr. Agarwal’s approach is that instead of approaching the issue by tackling “problems,” he focuses on the strengths of his target areas.  The article provides some great examples of this approach and how Dr. Agarwal adapted his solutions.

“People look at culture, traditions, and social norms as something that holds society back,” he said. “What we realized was, cultural traditions are an asset of a village. They are like social capital that can be monetized.”

In one case, that meant picking a village for the water harvesting program because one woman there was particularly upset about her drinking water. After spitting it out because it was undrinkable, then listening to her ask him how he would like to drink water like that every day, Agrawal knew she would keep the rest of the villagers motivated. He picked that village for the pilot program.

In another village, he listened to an ornery old man — addressing him with the respectful term “Baba” — who told him the water harvesting method would never work there, because it took up space where villagers liked to sleep on hot nights. He responded by making that aspect of the design flat rather than dome-shaped, so that it could still be slept on.

Dr. Agarwal’s ability to stay attuned to the local context clearly has increased his ability to implement successful solutions.  As Sustainable Innovations looks to expand, they will stay focused on holistic systems and public-private-community partnerships.

The ThinkChange India staff is committed to providing our readers with interviews with people we believe are at the brink of something special but have for the most part been overlooked by the mainstream media. Readers will be able to see other conversations under our TC-I Changemakers tag.

This week, Vinay sat down (over the phone) with Gautam Ivatury of the global microfinance center CGAP, which works to expand poor people’s access to financial services. Such services include but are not limited to microcredit and branchless banking. This interview is a follow up to one conducted on May 4, 2008, which you can read here.

Vinay Ganti: Could you please review yourself on the following topics, which we discussed in our last conversation?

• Reaching beyond MFIs:

Gautam Ivatury: This still continues to be a major focus of CGAP’s mission. Across all of CGAP’s work we continue to look for ways to partner with a range of institutions and providers, including but not limited to MFIs, to be able to massively expand financial services for poor people.

• Branchless Banking (see on right hand side of page)

GI: With regard to branchless banking, we set out to accomplish a number of goals. Overall we have been happy with the results of CGAP’s work in this area over the last six months, despite the fact that it has taken longer than expected for our project partners (in countries like Pakistan, Kenya, Mongolia, South Africa and elsewhere) to roll-out the branchless banking channels we helped design and finance.

Since our last talk, CGAP has expanded its policy and regulatory diagnostic work in branchless banking. New markets analyzed have included Colombia, Argentina and Indonesia, and we’ve continued to maintain close dialogue with the Reserve Bank of India and regulators elsewhere.

Also, the actual awareness of mobile banking in the field, i.e. what is and how it can work, has increased dramatically in the past. Last May we co-organized the first major annual event on “Mobile Money” for the unbanked in Cairo with the GSM Association (the industry body for the world’s 700+ mobile operators), IFC and DFID. That event got more than 500 paid attendees, most from private industry. And this week at the GSM World Congress in Barcelona, GSMA and other private sector players will announce additional activities in the space. DFID announced its new FAST program to encourage branchless banking this week. Initiatives like these are critical to get widespread adoption of the concept and to achieve scale. Moreover, major consulting and research outfits like Aite, Monitor and McKinsey have started research and published reports on the topic.

At the same time, our seven branchless banking projects have been slower to launch than we all expected two years ago. There have been some notable achievements — our Philippines partner has entered three new rural provinces and signed up about 80,000 new mobile banking clients, and Telenor bought 51 percent of Tameer Bank (our partner in Pakistan) to jumpstart its mobile banking initiatives. But in general the implementation of mobile / branchless banking has been slower than anticipated.

VG: Why do you think this is?

GI: In my view, the major reason for delay is the sheer complexity of all the moving parts required to successfully build out mobile banking in each market. The nuts and bolts of actually creating an operating infrastructure –building or implementing a tech platform, negotiating deals among banks and mobile operators, dealing with shifting regulatory conditions, etc. — extends timelines. In addition, many of our partners started with a general sense of what they wanted to achieve (a low-cost ubiquitous channel for basic banking transactions) and took some time to test and throw out various solutions and approaches, to end up with what they have now — a clearer operational plan that is well underway.

VG: Have the recent economic downturn, credit crunch and liquidity crises contributed to this?

GI: I wouldn’t say that these were major contributing factors. I think we now understand that even if one organization (a bank, let’s say) is pursuing mobile banking, this is still inherently a multi-party endeavor. The financial institution, mobile operator(s), cash-handling agents and any agent managers — all of these parties must be aligned operationally, commercially and technologically before the new business can get off the ground. Assuming you want scale, you cannot really do mobile banking on your own.

But finally, one major plus is that there is now a second wave of countries now starting to talk and think about branchless banking. CGAP will continue to informally advise, and selectively support, additional branchless banking projects.

• Graduation Programs/Ultrapoor Programs

GI: These are still a big part of our work, and we have several pilots ongoing — at SKS Microfinance and Bandhan in India, in Peru, and elsewhere. These programs are very interesting in and of themselves, and may be better suited to their own post. (Editor’s note: We will do a follow up piece on these programs in the near future so stay tuned).

• Creating Technology for MFIs and others

GI: For a while we have been interested about the possibility of “outsourcing” technology from MFIs and offering it on a pay-per-use basis. This is sometimes referred to as a shared platform or software-as-a-service model. In the Philippines, our partners NationLink and Opportunity International are testing a shared ATM network for small MFIs. In Ecuador, we are assisting Red Financiera Rural (the leading association of MFIs and credit unions) in finding ways to outsource technology to a 3rd party.

VG: Have you heard of new ventures like CashNxt? What is your and CGAP’s opinion on such technologies? What other novel technologies with regard to mobile phones excite you the most?

GI: Any technology choice must be secure, cheap and ubiquitous, which is why CGAP has focused so much on the cell phone. To me, the cell phone is that thing that is not going away and will only become more practical as an access device for poor people over time. Other instruments, like smart cards, have special utility in certain markets but not the same general potential.

From what I understand, CashNxt is similar to another solution called TagAttitude from France where the real advantage lies in authenticating face-to-face transactions. So if a person is going to pick up a remittance at a nearby agent, they can verify identity and the transaction can be settled. Similarly I can put my phone next to the merchant’s and authenticate using the secure audible message to pay for a hamburger. However, my impression has been that these technologies are not suited for ‘remote’ transactions — that is, to send money across the country just by punching digits into my phone or selecting the option from a menu. So I think these solutions are useful in specific applications but probably are not the universal authentication method for all mobile banking applications. I think the basic PIN, despite its limitations, still probably has general value.

VG: Where do you see the next step to be beyond branchless banking? How would social entrepreneurs best prepare for this movement?

GI: Mobile banking/branchless banking is still a very new idea and right now the biggest concern some observers have is that it is getting a lot of hype; ultimately that may be counterproductive. I believe that we are still 3-5 years away from seeing a relatively large number of successful mobile banking services at scale in developing countries. So for these next few years, my hunch is that most of the energy and money will still focus on getting “bread-and-butter” mobile payments into users’ hands. New ideas like extending credit via mobile banking or using it to improve procurement and inventory management for agents (to name innovations we are starting to see) will emerge slowly over the next 3-5 years.

VG: Well I want to thank you for taking the time to speak with us today. We hope you and CGAP all the best in your endeavor, and TC-I will be closely following all of its great work.

GI: Thank you, Vinay!

This winter, through the gracious support of the Social Equity Venture Fund (S.E.VEN), I will be working in Cairo, Egypt with Click Diagnostics, a mobile tele-health social enterprise venture that recently won the $100K Entrepreneurship Competition hosted yearly at MIT. As mentioned in previous posts relating to cellphones and development, mobile technology seems to be the next frontier in terms of poverty alleviation. In this case, the focus is on the delivery of high-quality, affordable healthcare to rural populations in developing countries.

Currently, the organization is in the start-up stage, and is piloting its implementation model in several areas, including Egypt. For the benefit of those who would like to learn more about Click Diagnostics’ for-profit model, a more detailed description follows:

The Need: The confluence of four critical factors has led to what Click Diagnostics believes is a global health mandate – 1) a severe scarcity of doctors in rural areas, 2) the relative abundance of medical expertise in urban areas, 3) the presence of trainable community health workers and local-level micro-entrepreneurs, and 4) the rapid penetration of relatively inexpensive mobile technology into the markets of developing countries.

The Model: Click Diagnostics employs a mobile tele-health model to connect locally trained community health workers with a remote, web-based network of medical specialists. Through the integration of inexpensive technology, locally trained community health workers, and remote medical expertise, Click Diagnostics aims to provide a sophisticated end-to-end healthcare service delivery chain for “remote diagnosis and consultation, health risks screening, early warning systems, and health data analysis.”

The Vision: Click Diagnostics aims to “provide quality medical advice to every household in disadvantaged regions of the world at an affordable price, and develop cost-effective solutions for gathering critical data needed for planning and executing public health interventions.”

The Piramal Group, a research and diagnostics firm based in Mumbai, is partnering with the Associated Chambers of Commerce and Industry of India (ASSOCHAM), NGOs, and more than 25,000 doctors across India to create a new campaign called “helpyourbody.” As LiveMint reports, helpyourbody is a

crusade against chronic diseases, aiming to provide affordable medicines in rural areas.

The programme… will emphasize on imparting knowledge on healthy food for healthy body and target each and every individual.

Through the three phases of knowledge, action, and care (which is the Piramal tagline), the campaign will first work to partner with thousands of doctors, then make “helpyourbody” tests available and employ detection camps, and finally build communities and involve local NGOs.

Dr. Swati Piramal, Director of the Piramal Group, is quoted as explaining the dire need for this CSR initiative:

India is expected to be the chronic disease capital of the world with 70 million diabetics, 213 million hypertensive patients and 60 million suffering from arthritis by 2025. According to the WHO, the cost of chronic diseases, including welfare losses, is estimated to be Rs 15,01,200 crore by 2015.

With those those numbers providing motiviation, the campaign, according to the helpyourbody website, aims to minimize “economic loss by 2% every year and [earn]  the nation Rs. 67,500 crores by 2015,” as well as save about 1 million human lives.

Your daily dose of information:

Energy and Environment: PM Manmohan Singh unveiled the country’s new Climate Action Plan, which will focus a large portion of its efforts on solar power. The plan also emphasized that these efforts are domestic in nature and that India is still firm on its stance against current international agreements.

Health: A new diagnostic tool will help identify drug resistant tuberculosis (TB) in only two days time; previous method took over two months.

Employment and Rural Jobs: A recent census suggests that rural jobs, both agrarian and non-, are growing at a faster pace than their counterparts in the urban centers, potentially decreasing urban migration across the country.

Your daily dose of headlines:

• Science & Tech: The Indian government has successfully launched 10 satellites simultaneously to significantly expand its presence in space.
• Women’s Rights: PM Singh asked local officials to fight the killing of female children by parents, and also turned to the health ministry to develop a grassroots effort to combat this trend.
• Education & Basic Rights: In Coimbatore, prisoners have access to classes to help them learn how to read and write.
• Employment and Local Control: Haryana’s CPS argues that the Panchayats should have control over funds allocated by the National Rural Employment Guarantee Act. Similarly, Finance Minister P Chidambaram has called for more local banks to reach out to the BoP.
• HIV and Health: A new study has shown that people in India do not have natural or genetic protection against the deadly virus. Along the same lines, researchers have found that diligent observation of the virus’ symptoms could prove an equally effective diagnostic tool as laboratory testing.