Business Skills and Digital Financial Literacy Leads to Higher Revenue for Women Micro-Entrepreneurs in India

Like all mothers, Gayatri will do anything for her family, including waking up at 5:30 am every day to open her kirana shop, where she sells everyday essentials like snacks, single-serve laundry detergent and other household products, sundries, and locally grown vegetables. Known as a kirana in Hindi, the shop is the primary source of income for the family. Despite the long working hours, Gayatri and her family still struggle to get by. 

Gayatri knew that she needed to improve her business and financial management skills if she wanted to grow her enterprise, so she decided to join Project Kirana. Developed through a partnership between the United States Agency for International Development (USAID) and Mastercard, and implemented by DAI Digital Frontiers and ACCESS Development Services (ACCESS), Project Kirana focused on helping women micro entrepreneurs gain the tools they need to grow their businesses in Lucknow and Kanpur, Uttar Pradesh, India. 

In India, there are 16 million retail establishments, of which women officially own only 9 percent. While women commonly participate in the day-to-day management of small retail businesses, particularly the small family-owned kirana stores, most of these entrepreneurs are not legally recognized as business owners due to local gender norms. While India has several policies and programs on women’s economic empowerment, these schemes show little traction and few outcomes on the ground, and women continue to be constrained by many socio-cultural barriers and disproportionate obstacles in their efforts to become part of the mainstream economic milieu. There are family restrictions, with expectations of them to devote themselves to household chores, restrictions on mobility, and general apathy when they explore business opportunities. Financial Institutions, including banks, are also skeptical in giving business loans to women, who invariably lack collateral. Further, digital payments are becoming increasingly common in India. In January 2023, 8 billion digital transactions worth nearly $200 billion were carried out in India. Many of these transactions are small amounts from uses at small and micro enterprises. Kirana shop owners see the benefits of digital commerce including an increased capacity to save and lower transaction costs. 

By equipping women entrepreneurs with the knowledge and tools they needed — including financial and digital literacy expertise, business management skills, and strategies for addressing cultural barriers — over 2,500 women were able to grow their small retail businesses and increase their incomes. While 83 percent of women participants reported an increase in their income and sales, 49 percent experienced an increase in the average transaction size per customer, indicating not only business growth but also enhanced customer loyalty. Further, the number of participating women who used digital payments increased by 135 percent and 81 percent of participants shared that the frequency of digital payments increased. Additionally, 42 percent of women reported an increase in business or private insurance ownership.  

For Gayatri, Today “What is Seen, is Sold”

Through Project Kirana, Gayatri learned how to register her business, diversify her shop’s inventory, organize her product displays to encourage sales, use digital payments, get a loan, make online orders, and communicate with customers using WhatsApp, in order to create more revenue for the business and stability for her family. After enrolling in the program, Gayatri has started maintaining a proper accounting book for the shop, she feels more confident in paying and receiving money from Google Pay and other digital platforms, and she is better at managing her inventory and displaying goods by the maxim she learned in training, “What is seen, is sold”. Gayatri reported that she has increased her sales by 200% due to changes she has implemented in the store based on lessons from Project Kirana.

The Approach 

Project Kirana recognized the complex set of problems encountered by women micro entrepreneurs in India: limited business and digital financial capabilities, and limited access to formal financial services. Through a combination of in-person training, educational videos, in-person and online peer-learning groups, and an app, the initiative provided actionable skills and built a supportive community that instills confidence and a sense of unity that women need to thrive in their businesses.

In-Person Training: The educational in-person trainings covered various topics such as business and financial management, digital payments, accessing financial services and entitlements, and promoting entrepreneurship motivation. These learning modules, totaling nine in-person sessions, were designed to empower participants with actionable knowledge so they could immediately act to improve their business. 

Videos: The initiative employed instructive and relatable videos in Hindi that delve into crucial business-management topics such as effective business practices, navigating the digital financial landscape, and understanding the nuances of gender dynamics. The videos feature a character named BuddhiMoney (Buddhi in Hindi means “wisdom”). BuddhiMoney is a young woman - a dynamic, affable protagonist within the community helping on issues relating to financial and business matters. 

Peer Groups: Informal peer groups of 30 women each were formed as a platform for peer support and troubleshooting, training, and technical support. Each club met twice per month for thematic training sessions, and experience sharing. 

The App: The women micro entrepreneurs also had access to the BuddhiMoney App. The app is a digital tool designed to enable participants to conveniently access financial and digital payment services, fostering practical avenues for women to engage with the evolving financial ecosystem confidently. Finally, program participants demonstrated a need for more support, and a helpline was created for business related troubleshooting, support in adopting digital payment modes, and BuddhiMoney App assistance. 

Lessons Learned 

While Project Kirana piloted a new approach to advancing women’s entrepreneurship in India, the barriers to women’s financial inclusion are still steep across the country. Only 5.4 percent of Project Kirana participants reported ever taking out a loan for either personal or business purposes. Women often find that financial services providers do have individual loan products for women with their low income levels. Despite interest from several financial services providers, the micro entrepreneurs were not meeting their individual loan criteria. Through the implementation of Project Kirana, valuable lessons have emerged for designing similar programs:

1. Partnering with financial service providers: Collaboration with financial institutions is essential to ensure the availability of tailored financial products that meet the specific needs of program participants. This became evident when despite the desire for loans to grow their business, women kirana store owners were found not eligible for existing financial products. 
2. Embracing an iterative approach: Projects must be flexible and adaptive to cater to the evolving financial and technical requirements of the participants. This iterative approach allows for continuous improvements and a better alignment with participants' needs.

For organizations who are looking for training materials on business and financial management, digital payments, accessing financial services, and promoting entrepreneurship, an open source version of the Project Kirana Training of Trainers can be found here for global customization and here for India. And for those, who are interested in implementing this program in their market, they can learn more in the Replication Guide and the Project Kirana Briefer.

By equipping women like Gayatri with financial and digital capabilities, business management skills, and a supportive community, the initiative demonstrated how to unlock new revenue streams, enhance financial inclusion, and foster entrepreneurial growth. Lessons from Project Kirana reinforce the importance of designing comprehensive programs that address the multifaceted challenges faced by women entrepreneurs. 

Author:

John Dorrett, Digital Finance Team, USAID