RFP: Revive Alliance Returnable Grant

REVIVE Alliance, is a blended finance facility and livelihood accelerator to help informal workers and micro-entrepreneurs. In collaboration with companies, foundations and social organizations, REVIVE identifies deserving informal sector workers and micro-entrepreneurs and provides holistic support to aid their recovery, build their resilience and invest in their long-term growth.

Through a continuum of support, including philanthropic grants, financial and digital inclusion, social security access, skilling and market linkages, REVIVE has been able to positively impact the families and communities of over 200,000 individuals since October 2020, and is on its way to reaching 10 million workers and micro-entrepreneurs

Through a set of blended and innovative financial instruments such as grants, social security grants, returnable grants and working capital backed by a credit guarantee supported by interventions such as skilling, digitization and access to social security schemes, the Alliance seeks to foster the economic recovery, resilience and growth for small businesses, nano entrepreneurs and workers — especially women.

The program has been catalysed with the following key objectives: 

  • Provide multiple interventions including skill-based training, access to jobs & workplace support
  • Provide step-by-step financial support via returnable grants & financial inclusion measures. 
  • Integrate participants into the formal economy by demonstrating their creditworthiness

The donor is a quasi-government body that seeks to foster skill development and entrepreneurship by supporting skilled workers and micro-entrepreneurs.

The Returnable Grant (RG) are instruments that provide short term, affordable and flexible philanthropic capital (at zero interest and zero collateral) to individuals and entrepreneurs, who have only a moral obligation to repay. The RG funds are expected to meet working capital needs of individuals or collectives, especially for those entrepreneurs who struggle to access such ticket sizes – either due to lack of sufficient reserves owing to their scale and/or capability to obtain formal credit. The tenure of repayment is customised to the need of the participant and repayments are to be made digitally in small monthly amounts.  The returned funds are then disbursed to other individuals and entrepreneurs, creating more impact per rupee spent. So far the RG has reached 23,000+ participants, with an average repayment rate of 95%.

It is expected that the RG will allow entrepreneurs to overcome a capital constraint and grow their business by taking on larger orders/enhancing inventory/deploying more workers etc, allowing them to produce more and earn a higher absolute margin/profit, which can be redeployed to grow the business further, creating a virtuous cycle.

Proposed program:

We are proposing to undertake a three-year program to provide Returnable Grant to micro-entrepreneurs who need affordable and flexible capital for their businesses. 

  • Demographics Targeted: artisan clusters, farmers and farm-allied businesses (cattle rearing, SHGs, FPOs, farm traders such as fruit/vegetable vendors), rural women service providers (eg: salon operators, small kirana stores)
  • Utilisation Purpose: Purchase of raw materials/goods for trade, paying worker wages as per piece rate and other inputs, farm inputs (fertilisers, seeds, cattle feed, etc.)

The funds will have to be of a specific ticket size per participant and redeployed at regular intervals for 3 years as mentioned in the terms and conditions section. In the proposal, organisations are expected to articulate the rationale for suggesting specific cohorts, income levels of the cohort suggested, their business needs and how the RG will help scale the same. The partner is also expected to demonstrate that they have a minimum of 1500 entrepreneurs in the first cycle and can redeploy funds every 6 months, depending on the repayments that have come in at that point. 

Role of the Organisation:

  1. Identification and mobilisation of micro-entrepreneurs and/or producer groups with working capital needs
  2. Co-creation of selection criteria of entrepreneurs with CGF, as per terms and condition section.
  3. Assessing the working capital needs of entrepreneurs and ensuring that it matches with the RG ticket size of each participant as mentioned in the ‘terms and conditions’ section.
  4. Ensuring periodic communication with potential program participants and existing participants recommended after duly meeting the selection criteria
  5. Ensuring that entrepreneurs are previously trained and ensuring they have been running their microbusiness for at least 2 years prior to 1st April 2023. 
  6. Conduct baseline and endline surveys for all participants and interim assessments to track performance and impact.
  7. Ensure sufficient participants are available and meet the selection criteria and other terms and conditions given below, every 6 months to ensure smooth redeployment of repaid funds. 
  8. Provide on ground support with adequate HR for the delivery of the program on ground, to ensure timelines are met. 
  9. Work with participants to identify stories of change for participants that have been positively impacted by the program so that these can be shared on larger platforms.

Terms and conditions 

  • Geographies of Focus: Pan-India. Maharashtra, Gujarat and Karnataka are preferred.
  • Participant Cohort Size: 1500 participants in the first cycle and then depending on repayments, further participants in each cycle
  • Gender Focus: 70% women and 30% men
  • Incomes of entrepreneurs- Earning between INR 15,000- INR 20,000 per month from their businesses
  • Redeployment Cycles: It is mandatory to have 6 cycles in 3 years, with redeployment every 6 months.
  • Fund management partner – Fund disbursement, repayment and redeployment of RG amounts will be managed through a fund management partner. Funds for the RG will thus be transferred from the said fund management partner’s account directly to participants identified by the NGO partner. Funds will be repaid by participants to the fund management partner and a new cycle of redeployments will begin every 6 months. The NGO partner is expected to identify participants in advance every 4-5 months so that redeployments can happen every 6 months without delay. 
  • Admin fees – NGO partners will be reimbursed a fee up to 4% of the amount redeployed in each cycle, for the scope of work mentioned above (Role of the Organisation).
  • Data Verification: All participants will be verified through valid government IDs
  • Participant Data Sharing: Participant data such as name, contact number, and bank account details will be shared with the donor and the fund management partner for the verification and disbursement of RG funds.
  • RG terms –  1 month’s moratorium and 5-6 months of repayment for participants who receive the RG.The RG ticket size (principal amount) would be INR 10,000 per participant on average across each batch. 
  • The RG can be extended to individuals or producer groups who would train the participants, procure raw materials and facilitate market linkages for producers.

Evaluation methodology for the proposal:

This RFP is open only to organisations with the following documentation: 12A, FCRA, registration certificate, trust deed/MOA, address proof, PAN, ITR of 3 FYs, Audit report of 3 FYs, 80G & CSR-1 Form.

Proposals will be scored and evaluated based on the responses provided by you to each of the sections given below. Final approval will be based on the evaluation of the proposal and organisation’s goals and objectives. We assure you that a fair evaluation and selection process will be followed and we will reach out for more program or organisation-related details if your organisation is shortlisted.

We have high regard for the work that you are doing in the development sector and recognise the efforts that you put into submitting a proposal. Therefore, in the event of a proposal not getting selected, we request you to not get discouraged as your proposal may not have met the current requirements of the client and you are encouraged to apply again in the future.

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