NABSAMRUDDHI, an NBFC subsidiary of NABARD, and Water.org, a global nonprofit organisation, co-organised a summit on ‘WASH lending’ in Mumbai on September 14, 2023. The primary objective of the summit was to promote water, sanitation, and hygiene financing as a critical factor in ensuring the sustainable development of the ecosystem.
The summit was attended by various NBFCs, MFIs, HFCs, and other relevant stakeholders who brought up pertinent points on gender integration and mainstreaming, among others.
Bonani Roychoudhury, Managing Director of NABSAMRUDDHI, highlighted the urgent need to advance the SDG 6 goals (Clean water and sanitation), especially from a gender equity perspective. She touched upon the role played by NABARD and NABSAMRUDDHI in promoting concessional WASH lending as a champion segment under its focus area of Green & Wellness finance.
“We have been making steady and sustained investments towards this end, which has particularly gained traction over the last two years. It is also notable that over 90% of about 40,000 ultimate beneficiaries covered under NABSAMRUDDHI’s WASH program are women. The support has led to an increase in disposable income levels and improvements in health, hygiene, and quality of life. The company is exploring other structured products to enhance its WASH footprint,” she said.
Manoj Gulati, Regional Director, South Asia, Water.org Conference touched upon the relevance of climate resilience and how the lack of access falls disproportionately on certain classes especially women making them more vulnerable. While speaking of the scope of Water.org activities through technical assistance and capacity building, he highlighted the gaps in financing and the need for developing a robust framework to ensure investment readiness from a global standpoint.
The summit included a panel discussion on ‘Impact of RBI regulations pertaining to WASH financing and ways to strengthen it’, moderated by Gyan Prakash fromWater.org. The panellists were Ramesh Ganta, GM, NABARD; Aswini Acharya, COO & PSL Head, Inorganic Business, DBS Bank; Ravinder Kumar, National Financial Inclusion Expert, FINISH Society; and Maheep Panwar, COO, NABSAMRUDDHI.
Ramesh Ganta highlighted NABARD’s instrumental role in WASH financing and indicated that NABARD has instituted a Special Refinance Facility to eligible financial institutions for financing WASH related activities at concessional rates.
The facility is available for financing WASH related activities such as construction of toilets/ twin-pit toilets, converting toilet to toilet-cum-bathroom with piped water connection, construction of overhead water tanks, additional bathroom-cum-toilet, installing piped water connection, retrofitting and up-gradation of dysfunctional toilets, setting up of bio-gas plants using human excreta, cow dung and kitchen waste, rainwater harvesting structures, etc.
The financing to WASH activities is a ‘thrust’ area and 95% of eligible loan is provided as refinance at concessional rate of interest, i.e. 5.70% p.a. at quarterly interest. It is expected that the benefit of the concessional refinance is appropriately factored in while fixing the interest rate for the ultimate borrower by the bank/FI, as per the scheme.
Some key takeaways from the summit included the need to support MFIs to enhance WASH lending, collaborative action on capacity building of lenders and borrowers, funding of MSMEs for community-level solutions, and development of innovative products for WASH Lending.
About NABARD:
NABARD is established as a development bank for providing and regulating credit for promotion and development of agriculture, micro, small and medium enterprises, cottage and village industries, handlooms, handicrafts, and other allied activities in rural areas, with a view to promote integrated rural development and securing prosperity of the rural areas and for matters connected therewith or incidental thereto.
NABSAMRUDDHI:
NABSAMRUDDHI Finance Limited was incorporated under Companies Act, 1956 on 17 February 1997 under the name of Agri Business Finance Limited and registered as Non-Banking Financial Company with the Reserve Bank of India. It was promoted with equity participation from National Bank for Agriculture and Rural Development (NABARD), Union Bank of India (erstwhile Andhra Bank), Canara Bank, Government of Andhra Pradesh, Government of Telangana, Andhra Pradesh State Cooperative Bank, Telangana State Cooperative Apex Bank and a few Industrial Houses / individuals from the State. The objective of NABSAMRUDDHI is to provide credit facilities to legal entities for promotion, expansion, commercialization and modernization in non-farm activities, including microfinance, MSME, housing, education, transport, etc.
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