Strengthening the Female Youth Entrepreneurship Framework in Bangladesh
The knowledge exchange supported under the South-South Facility, was undertaken between Bangladesh: Social Development Foundation, the implementing agency of the World Bank Nuton Jibon Livelihood Project (NJLP) and India: Kerala State’s National Rural Livelihood Mission (Kudumbashree).
The objective of the exchange was to deepen the expertise and capacity of the Social Development Foundation (SDF) to strengthen female youth entrepreneurship in Bangladesh, in particular through the Nuton Jibon Livelihood Project. The exchange led to new insights in (i) how to build a foundation to support female youth entrepreneurship; (ii) an understanding that different models can be successful; (iii) deeper exposure to successful examples, such as the Kudumbasree café model that is scaled widely. In addition, the knowledge exchange strengthened the capacity and skills of SDF to follow up in practical ways which can help make a difference in the NJLP program in Bangladesh.
Strengthening female youth entrepreneurship is easier said than done, especially in a context as complex as that of Bangladesh. A Bangladeshi organization called the Social Development Foundation (SDF) is being positioned to make this change happen as part of the Nuton Jibon Livelihood Project (NJLP) that is supported by World Bank. While having the right attitude to drive this change process, SDF miss concrete approaches and examples of success stories that can inspire female youth in Bangladesh and be adopted to the local context.
In India, Kudumbashree, Kerala’s State Poverty Eradication Mission, was launched in 1998. It is vested with the mandate to wipe out absolute poverty in Kerala through community action under the leadership of local governments. Based on a multi-dimensional understanding of poverty, Kudumbashree adopted the approach of organizing women in community-based organizations to empower them economically, socially and politically. Kudumbashree’s interventions focus on micro-credit, entrepreneurship and empowerment. Since its formation, Kudumbashree has evolved into one of the largest women empowerment missions in India, comprising of over 4.5 million members in Kerala. Kudumbashree has mobilized more than USD 200 million and has bank credit for the women groups to be utilized for consumption and livelihood purpose.
The knowledge-receiving team was composed of 14 SDF members, supported and facilitated by the World Bank team, consisting of the NJLIP Task Team Leader and a Consultant.
Under this overall objective, the team visited Good Practices on Kudumbashree’s Convergence, Collective and Innovation Models. SDF also explored different types of individual micro-enterprises that were not yet captured in the SDF operating districts in Bangladesh. Kudumbashree’s approach to partnership was also considered by SDF.
Another source of learning as part of the exchange was how to transition from a one-person micro-enterprise to an enterprise employing a minimum of five persons. Kudumbashree has an ‘incubation model’ for this that comprises training, financial tools, and handholding suport.
Training starts with a half-day orientation followed by a one-day workshop to determine the skills set and the needs for skills development among the entrepreneurs to move into a larger enterprise with employees. Based on the demands of the type of enterprise, the entrepreneurs are introduced to both theoretical and hands on training. This includes performance improvement training focusing on technical advancement, marketing, input sourcing and business skills, such as bookkeeping and accounting for larger enterprises.
While there are many financial tools towards enterprise development, the three modalities outlined below were found to be key to entrepreneurs in scaling-up their business:
- Technology Fund: This loan is facilitated by Kudumbashree through commercial banks to enable entrepreneur to secure any additional technical assets that are required to expand their existing business. The funding amount ranges between INR 50,000- 500,000
- Second Dose Assistance: This is an additional loan facilitated by Kudumbashree through commercial banks to entrepreneurs to expand existing business. The funding amount ranges between INR 50,000- 500,000
- Revolving Fund: This fund is facilitated by Kudumbashree for a group of entrepreneurs who have scaled-up their enterprises to enable access to additional fund. Funding amount is based on the capacity of the specific group.
Furthermore, Micro-Enterprise Consultants (MECs) can be assigned by Kudumbashree District Missions as hand-holders to entrepreneurs on a fee-based approach.
There are four interdependent pillars that hold and sustain Kudumbashree entrepreneurship program: local and central government buy-in, strategic partnership building and direct linkages with commercial banks and training. National and local government support are key factors of success. Public-Private Partnerships have also been crucial for success as they enable training for employment of beneficiaries and sale of end-product of entrepreneurs.
There is no one recipe to build an entrepreneurship model and capacity development needs to vary from region to region and are industry-specific. Multiple models can be successful. However, having concrete examples of success explained methodologically can help inspire and provide building blocks for a local solution that suits the Bangladesh context.
Beneficiaries / Participants
Social Development Foundation (SDF)
- Managing Director
- General Manager, Human Resources (HR)
- Deputy General Manager, Youth Employment Generation Support Program (YEGS)
- Officer, YEGS
- Regional Manager, YEGS
- Regional Manager, YEGS
- Regional Manager, YEGS
- District Officer, YEGS, Pirojpur
- District Officer, YEGS, Sylhet
- District Officer, YEGS, Sherpur
- District Officer, YEGS, Chandpur
- District Officer, YEGS, Satkhira
- District Officer, YEGS, Barishal
- District Officer, YEGS, Cumilla
- Insight on how to build the foundation for a youth female entrepreneurship model
Essential lessons were shared on local and central government buy-in, strategic partnership building, direct linkages with commercial banks and training as the four pillars that hold and sustain Kudumbashree entrepreneurship program.
There are two levels of buy-in from local and central governments. First, Kudumbashree secures 100% of funding (40% local government and 60% central government). Second, the local government plays the role of an intermediary for micro-enterprises to provide the input and link the outputs to markets. Poultry fattening is one example where the local government (panchayat) provides baby chicks to the entrepreneur and purchases the grown fowls at a cost to be sold by the panchayat /municipality on the markets.
Partnerships are built to enable training for employment of beneficiaries and sale of end-product of entrepreneurs. With regard to partnership-led training for employment, two types of training are deployed: (i) beneficiaries trained to meet the market requirements and (ii) beneficiaries trained to be consumed by the service provider (eg: Appollo Hospital trains nurses and other health staff). In terms of partnerships for end-product sale, both e-platform and counters in mega-stores are used to display and sell products (eg: Amazon- Saheli has provided a cost-free e-platform for sale of Kudumbashree products. In this regard, Amazon has also trained the Kudumbashree beneficiaries on the modus operandi)
The entrepreneurs of each neighborhood group (NHG) are directly linked with commercial banks based on the evaluation of the neighborhood groups. The Bank linkage program has made inclusive growth possible by providing easy access to bank loans without any physical collateral. The efficiency and effectiveness of NHGs are verified on the basis of selected objectively verifiable and easily identifiable parameters. India’s National Bank for Agriculture and Rural Development (NABARD) has developed a 15-point index for rating NHGs on the basis of which NHGs are allowed to link with various banks under the Linkage Banking Scheme. A three-phased training involves (i) awareness building; (ii) skills development of entrepreneurs through capacity building; and (iii) continuous handholding of entrepreneurs by MECs that provide support to the rural microenterprises of the poor and thus help establish a system which will provide all kinds of necessary support for entrepreneurs. As such, the mechanism promotes sustainability of the enterprises. This system includes handholding for new enterprises, branding and promotions, monitoring mechanisms and financial assistance.
Major activities to establish effective Micro-Enterprise Consultants (MECs) are: (i) strategic identification and selection of MECs from the community; (ii) building their capacities; (ii) placing them in groups; (iv) establishing linkages between Micro-Enterprise Consultants (MECs) and Community Based Organizations (CBO); and (v) rolling out sustainable monitoring mechanisms. In this context, the innovation is the application of training programs such as TED (Training in Entrepreneurship Development) or TEAM (Training in Enterprise Administration and Management), that are provided through master trainers to equip the MECs with basic arithmetic and business management skills. Experience indicates that at the end of the trainings, MECs are capable of formulating business plans for new enterprises and conducting business diagnostics for existing enterprises.
To ensure attention to gender and vulnerability, a participatory exercise is key to map the locally prevailing vulnerabilities and elements that are creating such situations. It provides a view through vulnerability lens to assess existing vulnerable population, issues that contribute to their vulnerability and determine the type of micro-enterprises that could be done through collective action in the given location. Gender Resource Center (GRC) is a one-stop mechanism to initiate gender sensitive development programs. The different modules of the GRCs include gender sensitization, gender mainstreaming, gender planning, gender analysis and convergence programs to generate gender sensitive development programs for holistic empowerment of women. GRCs allow for developing and making available the resources at a single place to share them across organizations to make their efforts more streamlined, efficient and effective.
- Understanding that multiple models can be successful
The Convergence Model has been central with the Kudumbashree idea. Convergence with the so-called Panchayat Raj Institutions (PRIs) has been worthwhile. Convergence means seamless working together of the Kudumbashree and the PRIs; it includes institutional and programmatic convergence as well as sharing of resources. Convergence is concerned with a multi-tier Panchayat Raj system in rural areas, urban local government institutions in urban areas, the three tier Kudumbashree community organisation, the State mission and its district level offices, and the government and its institutions and agencies. Examples include successful models of apparel consortiums and producer companies, all of which have made substantial marks in entrepreneurship development. A fuller overview of good practices examples can be found at the website of Kudumbashree.
- Deep dive on examples of female youth entrepreneurship and of scaling up in food sector
Café Kudumbashree is widely considered a good practice to learn from, and the larger Kudumbashree imitative has been documented in over 300 published articles. The concept was founded by the Thrissur district mission in 2009-10 in order to improve the conditions of canteen/ catering units operated by Kudumbashree members. A management and marketing group called AIFRHM (Adebha Institute for Food Research and Hospitality Management) was formed to aid the process . The restaurants are branded under a common brand called ‘Cafe Kudumbashree’ and standardized foods and services are provided. Handholding support is given for quality, management diversification of products, new recipes, best practices in the industry, better resource utilization, catering to customer needs. They have trained more than 400 Kudumbashree catering entrepreneurs in 27 batches (Kudumbashree, 2015).
Café Kudumbashree units have a strong presence in food festivals/fairs, catering for various occasions and canteens. New concepts like food court and amenity centres are also coming up. The brand represents ‘quality, pure food served with care by women’. The groups receive tremendous support from the local community and the enterprise has helped many women upgrade their social status by way of revenues from the units.
Kudumbashree sees scalability as (i) opportunity for higher income generation; (ii) opportunity for employment generation; (iii) learning platform for future enterprise-based projects; and it identifies food business as the primary business for scalability.
Successful models include:
- Institutional canteens: food businesses that typically target a specific group or a particular category of customers and are opened in the premises of government offices, bus/railway stations, or companies. In such cases, volume is huge, working capital requirement is relatively high and poses requirement for efficient and scientific design kitchen and improved safety and hygiene standards
- Catering units: only require supply against confirmed orders. Risk is low, wastage is limited and availing advances against orders reduces the working capital burden on women. However, it is dependent on the frequency of catering events
- Kiosks: they are temporary structures that are set up on the street and can be opened in a small space with small kitchen space to cook with an open counter to serve the cooked dishes. They offer clean, hygienic and healthy snacks compared to the roadside eateries. Serve both hot and packed food items. Working schedule is flexible to suit the entrepreneur and the customers
- Mini-cafés: they are permanent or semi-permanent structures, with minimum space utilization and maximum turnover. Moderate investment is required, offering efficient utilization of manpower. Easy and quick to cook menu.
- Restaurants: they require higher investment and working capital. They are location dependent, requiring places that attract a wide range of customers. They offer high profit margins
The knowledge exchange and the follow-up sessions allowed to strengthen the capacity of the Social Development Foundation and the implementing agency of Bangladesh NJLIP to advise and guide self-employed female youth and other female youth beneficiaries to become entrepreneurs and to move from one-person startups towards a sustainable and higher return enterprises, by leveraging partnerships with government and private sector in terms of training, capital sourcing and marketing.
Street dialogues took place in 12 NJLIP districts as follow-up activities to the study visit to Kudumbashree to provide further guidance to NJLP female youth beneficiaries to better understand the ‘nuts and bolts’ of enterprise development. This also helped build capacity of parents of NJLIP female youth beneficiaries and community organizations to influence female youth to strategically select skills training with increased chances of enterprise development by participating in street dialogues conducted by SDF on the experiences from knowledge exchange.
A first set of five short movies has been produced and is accessible online. These video interviews with selected successful entrepreneurs were both a way of recognizing this as well as an opportunity to share these stories more widely to inspire other female entrepreneurs.
Social Development Foundation, Bangladesh
Results Story Author: Robin van Kippersluis & Dulce Govea Aguilar
 See: http://kudumbashree.org/pic-topic-description/best-practices
 See: http://kudumbashree.org/pages/500