MICROCAPITAL BRIEF: Axis Bank Bandhan Holistic Assistance (ABHA) Initiative to Combine Microfinance, Health Services, Grants to Individuals in West Bengal, India

Axis Bank Foundation (ABF), the corporate social responsibility arm of India-based Axis Bank, and Bandhan Konnagar, the non-profit branch of Indian microfinance institution Bandhan Financial Services Private Limited (Bandhan), have collaborated to launch Axis Bank Bandhan Holistic Assistance (ABHA), to provide financial, health and support services to the “poorest of the poor” in two districts in the Indian state of West Bengal.

ABHA’s poverty reduction strategy involves “24-month grant-based interventions” in the areas of livelihood generation, skill development, education, health and social awareness. ABHA is a scale-up of “Chartering into Unventured Frontiers Targeting the Hard Core Poor Program” (THP), which was launched in 2006 by Bandhan to help poor people “find their rightful place in the socio-economic mainstream.” ABHA will have a budget of INR 100 crores (USD 21 million) to cover 50,000 families over five years.

As of 2010, Bandhan reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 614 million, a gross loan portfolio of USD 565 million, approximately 3.2 million borrowers, return on assets (ROA) of 5.32 percent and return on equity (ROE) of 41.1 percent.

Established in 2006, ABF has reportedly disbursed funding and grants totaling INR 25 crores (USD 5 million) as of March 2011. Axis Bank allocates 1 percent of its profit-after-tax to ABF for its activities. As of 2011, Axis Bank reportedly has 1,390 branches and extension counters, total assets of INR 2 trillion (USD 52 billion), ROA of 1.68 percent and ROE of 20.1 percent.

By Nisha Koul, Research Associate

About Bandhan Financial Services Private Limited (Bandhan): Bandhan Financial Services Private Limited is a microfinance institution (MFI) based in Kolkata, India, that was founded in 2002. As of 2011, it operates approximately 1,550 branches in 18 states in India. It offers microenterprise loans as well as loans for individuals to pay for health emergencies. As of 2010, Bandhan Financial Services reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 614 million, a gross loan portfolio of USD 565 million, approximately 3.2 million borrowers, return on assets (ROA) of 5.32 percent and return on equity (ROE) of 41.1 percent. It has a nonprofit arm named Bandhan Konnagar that “supports microfinance services to alleviate poverty and empower women.” Financial information on Bandhan Konnagar is not available.

Sources and Additional Resources:

Bandhan Financial Services Private Limited, “Axis Bank Foundation and Bandhan team up to cater to the most impoverished,” http://www.bandhanmf.com/report/abha.pdf

Microfinance Focus, “Axis Bank, Bandhan to Launch Program for Poorest Families,” http://www.microfinancefocus.com/axis-bank-bandhan-launch-program-poorest-families

MicroCapital.org story, September 16, 2010, “MICROCAPITAL BRIEF: Western Union Partners with Bandhan to Provide Money Transfer Services in Rural India,” https://www.microcapital.org/microcapital-brief-western-union-partners-with-bandhan-to-provide-money-transfer-services-in-rural-india/

MicroCapital.org story, September 15, 2010, “MICROCAPITAL BRIEF: India’s Axis Bank and Microfinance Institution Janalakshmi Agree to Expand Access to Financial Services for Country’s Urban Poor,” https://www.microcapital.org/microcapital-brief-indias-axis-bank-and-microfinance-institution-janalakshmi-agree-to-expand-access-to-financial-services-for-country%E2%80%99s-urban-poor/

MicroCapital.org story, October 14, 2010, “MICROCAPITAL BRIEF: Bandhan Financial Services of India to Provide Wholesale Loans to Smaller Microfinance Institutions (MFIs),” https://www.microcapital.org/microcapital-brief-bandhan-financial-services-of-india-to-provide-wholesale-loans-to-smaller-microfinance-institutions-mfis/

MicroCapital.org story, July 12, 2010, “MICROCAPITAL BRIEF: Axis Bank Extends Financial Services to Rural Areas in India,” https://www.microcapital.org/microcapital-brief-axis-banks-extends-financial-services-to-rural-areas-in-india/

MicroCapital Universe profile: Bandhan Financial Services Private Limited, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Bandhan+Financial+Services+Private+Limited

Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/

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