How supporting social entrepreneurs benefits whole communities

What if 130 social entrepreneurs could grow their businesses to create job and income opportunities for 100,000 men, women and young people? And what if they could create better lives for people in their communities at the same time? These are the goals of our new partnership with Yunus Social Business Fund in India and Kenya. The programme will support social entrepreneurs like Naveen Krishna with training and access to networks and finance so they can scale their businesses and increase their impact. 

Naveen’s Story

Naveen was born and raised in a small village outside Varanasi in Northern India. Every day, he saw manual rickshaw cyclists doing the backbreaking work of pulling people in rickshaws. After a hard day’s work, they would return home with very little pay. He noticed the rickshaw cyclists often came from some of the most vulnerable communities. 

“We started SMV Green with two objectives in mind,” said Krishna. “The first was to upgrade the manual cycle rickshaw pullers to electric rickshaws to eliminate the physical pain and drudgery of a pulling the cycle rickshaw. We wanted to bring dignity to these people working so hard to make a living for their family. 

“The second objective was to create an ecosystem within last-mile transportation, as Indian streets are some of the worst in the world for pollution and traffic. I’m not able to simply go for a walk with my family on the streets. I wanted to create a business that benefits everyone with cleaner transport. We plan to go to 10 cities by 2020 and long-term we want to reach every city in India.”

Electric rickshaws transform lives

SMV Green upgrades manual rickshaw cycles to e-rickshaws by providing access to affordable financing, as it is very difficult for drivers to go to the bank and get a loan to purchase their own vehicle. The social business also provides training, registration with the road transport office and insurance for both the vehicle and driver. Drivers of electric rickshaws often rent from owners of fleets, who charge exorbitant rates. SMV Green cut out the middleman and enable drivers to become owners themselves, increasing their income from US$3 to US$12 per day. 

Through the Vahini Project, SMV Green is also encouraging women to break stereotypes and become electric rickshaw drivers in a male-dominated industry. Mobility is key to female empowerment but is an area that is often overlooked. To make the women feel safe, the vehicles have a camera on board with cloud reporting. The project also provides them with a mobile phone, which has a panic button linked to the nearest female police officer. 

Challenges of reaching rural India

There are many rural places in India where electricity is not readily available, making it difficult to introduce electric vehicles. To solve this issue, SMV is running a pilot with a grassroots energy company who have a biogas plant in a rural village. They have surplus energy during the daytime (when there is less need for lighting and cooking), so electric rickshaw batteries can easily be charged with the surplus. 

Naveen explains: “If I am just upgrading a manual rickshaw to an electric rickshaw and providing no further support services, then the impact becomes very limited. As a company, our focus is to build the ecosystem around last-mile electricity and clean transportation in India. We understand very clearly as an enterprise that you need various kinds of interventions at different levels, so as many people as possible can benefit socially, environmentally and economically.”

Setting up a social enterprise is complex in India and there are huge variations between the central government policy, state and district policy. There are around 50 steps if you want to register a company in India and it is difficult for aspiring entrepreneurs to find out how to start or where to go for help. 

Support from Yunus Social Business Fund 

Many banks and schemes provide debt financing to small social enterprises. However, receiving support is very difficult as the terms are specific and often do not match the needs of social businesses. The partnership between IKEA Foundation and Yunus Social Business Fund will provide business advisory services, networks and access to finance to help entrepreneurs in India and Kenya grow businesses that offer social benefits to people living in poverty. Follow us on social media where we’ll be sharing more inspiring stories of social entrepreneurs in 2020.