Cover photo: After her sales plummeted during the pandemic, Rosina Das reopened her grocery store in her village in Odisha, India, with emergency loan support from Annapurna Finance Ltd.

Twenty-six-year-old Rosina Das runs a small grocery shop in her village near Balakati, Odisha, in eastern India. She and her husband own a small lot of land, but their crops don’t bring in enough money for them to provide for their two children and meet their household needs. Because her family hasn’t been able to afford to install pump irrigation, they must rely on rain for their crops and can only grow during India’s kharif, or monsoon, season. Rosina needed another way to support her family, so she converted a small room in her house into a grocery store and became a small business owner.

When Rosina first started her business, she used her savings to buy grocery items to sell in her shop. Her business quickly took off since there weren’t many other stores in her village. Once Rosina opened her doors, she gave families in her community the ability to purchase fresh food and other essentials that weren’t able to buy before. Rosina availed of her first loan with Annapurna Finance Ltd., a microfinance institution and Accion partner in India, two years ago as a group lending client to grow her small business even further. As her household income increased, her family was able to break their pattern of dependence on seasonal agriculture.

Like millions of other micro, small, and medium enterprises (MSMEs) operating in India, Rosina’s business has struggled greatly during the coronavirus pandemic. Not only did her sales plummet, but she also had a hard time getting new inventory to sell in her store as her suppliers were limited by transport restrictions during India’s strict lockdown. Without her regular customer volume or sufficient stock to sell, Rosina suddenly found herself without a stable income and unable to repay her small business loan installments. She learned about India’s loan moratorium from the other borrowers in her lending group and worked with Annapurna to reschedule her repayment dates and extend her loan tenure for two more months — a huge relief for her stalled business and her family.

Papina Das owns a small dairy business near Balakati in eastern India.

Rosina also learned about Annapurna’s midterm loan offering, a type of emergency loan that could help her restart her business. She received an emergency loan of 15,000 INR (205 USD) within seven days of application and purchased what she needed for her store. As demand has rebounded in her village, Rosina has provided the groceries that her community needs. Just a few months ago, she lost hope and couldn’t imagine her livelihood returning to normal. Now she is grateful to Annapurna for providing the support she needed to reopen her business.

Papina Das, 34, lives in the same village as Rosina, where she runs a small dairy business selling milk in her community and to nearby villages. She employs one other person from the village to help her feed and milk her cows. She started her business two years ago with a group loan from Annapurna. The other members of her lending group are also self-employed and own dairy businesses. Before COVID-19, Papina made a profit of more than 10,000 INR (137 USD) per month from her milk sales.

Papina’s sales dropped dramatically when the pandemic started. Residents of her village and the surrounding villages suffered greatly from the lockdown’s financial impact and many people lost their livelihoods. Even Papina’s regular customers stopped buying their usual volume of milk. Although milk is an essential commodity, her profits plummeted as economic instability decreased demand and people feared infection at markets.

Within one month of lockdown, Papina’s profits were cut in half. She was forced to lay off her employee and unable to pay her loan installments on time. After an Annapurna employee proactively contacted her by phone and informed her about the loan moratorium during the lockdown, Papina opted to take a three-month moratorium on her payments. Like Rosina, Papina decided to take advantage of Annapurna’s midterm loan. Within three days of applying, she received a 20,000 INR (274 USD) loan. With this assistance from Annapurna, she’s rehired her assistant and restarted her dairy business. She’s also purchased another cow to speed up her business’s recovery, and her milk sales have nearly recovered to pre-pandemic levels.

A flexible loan can be the reason that a grocery store stays open in a village with few options for fresh food, or a dairy business continues providing milk to families in a rural community. Through Mastercard and Accion’s partnership, Accion is working with Annapurna Finance to develop a new digital emergency loan product for group lending customers like Rosina and Papina. To build products that help entrepreneurs stay in business, we surveyed Annapurna’s small business clients to understand their experience and confidence using digital tools, how gender gaps affect digital access, the role of misinformation, and more. When financial services providers like Annapurna consider the unique challenges that their clients face, they can play a critical role in helping India’s women entrepreneurs use well-designed digital tools to overcome the pandemic’s challenges and help rebuild their local economies.

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