Our Journey

Building institutions. Empowering marginalised. Creating sustainable impact.

 

I. TIREN is the latest addition to the integrated stack of institutions which comprises:

  1. Self-Help Groups (SHGs) which emerged in MYRADA in 1984-85. NABARD provided MYRADA with a research grant of Rs. 1 million in 1987 to test this innovation.
  2. The SHG-Bank Linkage program launched in 1992 by NABARD-RBI with three policy changes. The findings from the research grant to MYRADA was the basis of these policy changes.
  3. Sanghamithra Rural Financial Services (SRFS), a not-for-profit MFI promoted by MYRADA in 1995 to provide credit in remote areas out of bank access. SRFS works in partnership with Self-Help Groups, their federations, called Community Managed Resource Centres (CMRCs), NGOs, Farmers collectives, etc. It works in a partnership model. The partnership model is both a strength (repayment efficiency almost 100%, no harassment of client, good outreach in remote areas), as well as a limitation (size of loans average Rs.50,000 – too small for investment in livelihood activities, when at least Rs. 3 lakhs is required, no support services provided like management, technical and digital skills, marketing links, no post loan visits to help solve problems). The partnership model could not work in areas where there were no SHGs / NGOs and where these institutions were weak; hence growth was restricted.
  4. TIREN – a for-profit company promoted by SRFS in 2024. TIREN enables the program to extend to the areas where there are no NGO’s/SHG’s; it provides larger loans and technical and management support.

II. Our Model

TIREN’s product model is currently being tested under SRFS in collaboration with Harvard Business School. In districts of in Erode, Kolar, Mysore and Kalaburagi; 305 unique Graduation loans with average ticket size of Rs 2.12 lakhs have been sanctioned so far.

III. Below are the insights from the impact survey conducted :

  1. There is high demand for larger loans. About 20% of the SRFS borrowers showed interest in large loans and about 50% of them got approved.
  2. 65% of entrepreneurs/agripreneurs in the study are interested in a loan to expand/upgrade existing business.
  3. Most of the entrepreneurs/agripreneurs tend to be female, married and literate. Approximately 70% of our sample is female, nearly everyone is married, and over 80% of individuals are literate
  4. The loan successfully expands/deepens financial access and enhances the growth process; borrowers are 21 percentage points more likely to have a current loan often from a SHG. This signifies that a family needs atleast two loans of which one is a larger loan to be integrated in the growth process in sustainable way.
  5. Graduation loans are associated with business expansion sustainability and increased profitability: Six months after receiving the graduation loan, surveyors found evidence of positive impacts on various measurements of business size and performance.

IV. Features

A. Building Trust and Long-Term Partnerships. TIREN-

  • Involves clients in the credit process by giving them choices in sizes of loans and schedules of recovery with life and health insurance facilities.
  • Empathises in recovery  strategy with diverse and custom-made repayment schedules
  • Supports long term partnerships keeping in mind the interest of both TIREN and the client

B. Innovative Approach for Sustained Self-Employment. TIREN-

  • Respects diversity in loan sizes: “one-size-does-not-fit-all”
  • Creates an intermediate, holistic, and integrated system to support sustained self-employment
  • Establishes a last mile – hybrid – both personal and digital – for deeper penetration
  • Ensures NIM is lowest in the MFI sector – No predatory lending
  • Incentivises staff feedback and innovation.

C. From financial inclusion to growth inclusion. TIREN-

  • Extends larger loans (upto Rs. 3 lacs) than current MFI practice (average Rs. 45,000)
  • Provides management, technical skills, and market linkages, partly funded by CSR and partly by the client, to ensure effective utilization
  • Capacity building to convert feedback into strategy to meet emerging needs
  • Hiring staff who know the local language and customs
  • Balancing the weightage given to the quality of service and quantitative data.

V. Challenges & Solutions

Major Challenges faced by Tiny Entrepreneurs and Agripreneurs

  • Limited outreach of support services like upgrading skills in management and technology.
  • Dominance of markets which exploit vulnerabilities of livelihoods in the informal sector and gives priority to short term profits.
  • Limited access to finance in a flexible manner to cope with diversity.
  • Pressure to access finance to overcome stress rather than to invest.
  • Limited respect for traditional strengths which cannot be identified through technology alone but needs personal contact.
  • Dependence on intermediaries like NGOs and SHGs which are declining in number and quality
  • Dominance of traditional model of microfinance which promotes small unsecured loans, strict adherence to Banking rules (especially, BC model), uniformity in size of loans and repayment schedules.

TIREN provides solutions: Integrated Support and a Hybrid Model

TIREN aims to –

  • Create an intermediary system that integrates support services, both before and after the loan is extended.
  • Implement a hybrid model managing the last mile—both digital and personal.
  • Provide larger loans for entire activities, thereby avoiding the need for multiple borrowings and reducing risk of TIREN.

 

TIREN provides Financial Inclusivity and Loan Flexibility

TIREN will –

  • Keep NIM (Net Interest Margin) to the lowest in the sector and lobby for subsidies to reduce borrowing and lending costs.
  • Provide space for diversity in loan size and repayment schedules.
  • Encourage savings in respective banks with which TIREN partners in the BC (Business Correspondent) model.
  • Ensure no over indebtedness as per RBI norms
  • Support entrepreneur by identifying and removing obstacles to ensure successful running of projects – like tech, skills, marketing etc
  • Foster support groups of 3 or 4 to provide support as well as to exert social pressure based on traditional norms related to repayments.

Scroll to Top