There
are many microfinance institutions active in rural
India, but very few serve India’s urban
population. To bridge this gap, Ujjivan’s
initial focus is on the urban poor. This is a
fast growing segment that is relatively new to
India’s microfinance industry. Our surveys
and interaction with the urban poor show that
they are exposed to enormous numbers of contingencies
and are required to share their meager resources
with neighbors, friends, relatives and colleagues.
Hence, there is a tremendous amount of bonding
and affinity among them. We have also found that,
contrary to popular belief, the urban poor are
a stable population. Therefore, the significant
difference between the urban and rural population
is the lack of time and availability of space
in cities.
 Our
primary target customers are women because research
has shown that they are a better population segment
for microfinance. They are proven to spend a larger
portion of their money on the welfare of their
family and therefore create systemic changes needed
to move their families out of poverty. The lending
alternatives for poor women, besides MFIs, are
comprised of moneylenders and other high cost,
typically unreliable services.
Our strategy, products and distribution methods
began based on the results of an 18 month pilot
program and an extensive market research study,
both based in Bangalore, and has evolved over
the past three years based on our findings and
experience in each of our regions. From our research
and experience, we have found that income is not
a reliable determinant to establish economic status
of the urban poor, so we also consider a variety
of factors other such as housing, occupation,
education, expenditure etc. Unlike in rural areas,
a substantial portion of the urban poor are employees
with salary income, working in the unorganized
sector as housemaids or cooks and the organized
sector in factories, hospitals, offices and hotels.
The self-employed are mainly vendors, small shopkeepers,
tailors, etc.
As on 31st March 2011, Ujjivan has disbursed over Rs. 20,734 Million to more than 991,000 customers at 351 branches in 20 states across India.
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