Holding a PhD in Women Empowerment, Dr. Aqueel Khan, founded Mitrata to help the financially excluded and often overlooked target groups, with a focus on women. An example is Saroj, who lives in Manoharpur Village. She was able to start a small dairy business, repair her kitchen and educate her children thanks to Mitrata.
Saroj’s success story did not surprise the startup founder Dr. Aqueel in the slightest. “Women are financially excluded, but proven to be the most responsible borrowers,” Dr. Aqueel explains, giving insight into why he established Mitrata, a startup that specializes in providing fair access to credit and credit-plus services for women and other marginalized groups.
Mitrata, a service for the financially under-served, is a Non-Banking, Financial Company or Microfinance Institution, sometimes known as last-mile bankers, ready to not only provide financial support outside of standard banks, but to help in other aspects of society still suffering, on top of banking.
Understanding the other side
With a PhD in Women Empowerment and as Founder, Dr. Aqueel’s inspiration for Mitrata started with the same pillars of study as his degree. “All the assumptions of access, opportunity and decision-making lead to women empowerment becoming the DNA of Mitrata.”
The statistics support Mitrata’s mission. Although women owned only 35.4% of bank accounts in 2021, they are the family budgeteers. Women play key roles in a country’s economic backing, often being the sole financial planner for household and childcare. But, with lack of support and access to credit, health services, and insurance, they remain stagnated.
Mitrata isn’t a one-size-fits-all kind of company, they believe in developing need-based tailored products according to the unique realities of the target groups. “Mitrata is committed to reaching out to all excluded and marginalized groups irrespective of their gender. We cater to groups including migrant workers, farm laborers, and construction workers.” These are the groups most at risk of experiencing larger financial hardship, and Dr. Aqueel is not exclusive because he knows there’s more than one type of person Mitrata can help.
Teach the one, then the many
Mitrata relies on Priority Sector lending, allowing them to dedicate their assets to those in most need. Partnering with banks and international credit agencies like TransUnion and Experian, as well as private companies like Bajaj helps Mitrata “in credit underwriting and identifying needy and eligible clients, making sure resources are reaching the people who are living below the poverty line.”
Mitrata doesn’t stop at the individual; it builds the bigger picture for whole communities. The story of a Mitrata user and an aspiring migrant, Qutbuddin Shah, is only one example of how a person’s first step can ignite a village: After nine years traveling from India to Qatar for work, Shah had no savings, a treasury of debt, and only a tourist’s visa instead of the required work visa for his next migration cycle. A migration cycle in such a precarious situation could have made his migration unsafe and left him highly vulnerable to further financial hardships and forced labor conditions.
He relied on local moneylenders to finance his trips, taking out loans with 120% interest to cover the cost of migration. It wasn’t until a visit from a Mitrata officer to his home village that Mr. Shah learned about the company’s “safe migration” loan and that he was in need of a work visa instead of the tourist visa deceivingly provided by an unauthorized recruitment agent.
One month later, Mr. Shah had both a work visa in hand and applied for Mitrata’s safe migration loan, cutting down his interest cost by 80% and making his financial goals possible. “This inspired other aspiring migrants in the community. Many refused to migrate on tourist visas and looked forward to taking formal credit instead of high-cost informal credit from moneylenders,” says Dr. Aqueel.
According to Dr. Khan, “Being a part of the Financial Inclusion for Migrants cohort at Village Capital has given Mitrata the chance to mainstream the agenda of modern-day slavery of migrant workers, and their financial vulnerabilities which otherwise would not have been possible.” Mitrata has innovated and developed a Financial Inclusion Program for blue-collar workers who migrate to Gulf countries for work. If left financially exposed, they become prone to forced labor conditions and Modern-day slavery.
“Developing interventions for this target group is financially viable from a business point of view,” says Dr. Khan. Through Village Capital’s support, Mitrata aims to scale up the program and demonstrate its operational and financial viability at a scale.
Community over collateral
A company that helps improve access to credit is a great start, but Mitrata doesn’t stop at the banks. What sets it apart is its drive to improve lives. Dr. Khan says, “Mitrata model is a phygital (physical and digital) model. At every level, it redefines quality and innovation.”
Mitrata members strive to meet bi-weekly with clients in person, for a human connection. They also exchange video messages on mobile to keep in touch and maintain client relationships. For Mitrata, it’s not about collateral, it’s about community. Prioritizing loan requests is just the beginning of the company’s impact.
With its Sanitation for Empowerment program, for example, Mitrata goes beyond the bills to “provide financial and non-financial support.” It ensures women have good access to water and sanitation facilities in their homes. Mitrata’s Toilet Improvement Loan is designed specifically for water supply installation and toilet infrastructure, allowing another client, Ms. Rajkumari, easy access to a 24-hour plumbing system right at home. Given her disability, this was a massive factor in changing her life.
Modern business is about people
Mitrata is still a young company, landing on the scene in late 2017, so is still making that uphill hike to become the best in its nation, which will require retraining employees and its client-oriented policies, like their bi-weekly visits.
One of Mitrata's major internal challenges has been developing a dedicated and well-trained workforce. The primary focus has been on unlearning old habits and embracing new principles that differ from the traditional ways in which employees have been accustomed to learning. “Our goal was for them to demonstrate greater responsibility and transparency while adhering to established policies and procedures.”
To accomplish these goals, Mitrata recognized the critical importance of training, capacity building, and continuous learning and development. Furthermore, the company invested in developing a strong team of managerial leaders. This proved instrumental in sustaining the overall initiative.
They’re building a brand to be trusted and loved. Mitrata’s team is enriched with specialists in Banking, Technology, and Impact, as well as other fields, making it a tiered and grassroots monolith. Mitrata's professional approach ensures that the company operates with well-developed systems and procedures, enabling seamless integration from the grassroots level to the corporate office.
Mitrata's five-year plan includes addressing the unmet need at the user level. Dr. Khan’s team aims to develop tailored solutions for migrant workers, ensuring their safety and financial stability during migration. Additionally, Mitrata envisions a comprehensive single-window healthcare system that integrates diagnostics, referrals, treatments, and telemedicine.
The mission to empower contractors and construction workers through access to credit and support, promoting fair labor practices, eliminating child labor and educating on gender sensitivity reflect the startup’s commitment to a lasting impact, promoting financial inclusion through disruptive and innovative interventions.