Mahashakti Foundation 3
With a loan of EUR 26,200 the Mahashakti Foundation can provide 600 houdeholds with solar lamps.
- Local partner investment
- 10 new jobs
- 40 people reached
One of the most financially poor States in India is Odisha- where 91% of the population resides in villages, and 39% belongs to tribal communities where the average daily income is below $1. Mahashakti Foundation covers six of the most underserved districts here.
Villages in these districts, such as Subarnapur despite being on the grid, face frequent power cuts on a daily basis. On any given day, there is no electricity for 4-5 hours. Naturally, this means that many more challenges for the residents. The most discernible of these include their inability to cook food post sunset, children having to finish up with their studies before 5 in the evening, hawkers packing up and the high expenditure on kerosene lamps. The lesser obvious ones include wild animals entering the village causing havoc and the sick not getting proper treatment due to lack of visibility. Against this backdrop, Mahashakti Foundation started a Solar Energy programme in 2012. Mahashakti builds and operates micro-grids, solar lights, charging stations and improved smoke-free cookstoves. Solar powered lighting has improved the general quality of life in the region. The beneficiaries have reduced expenses on traditional sources of lighting such as kerosene, increased economic activity through extension of working hours, fewer health issues arising from toxic kerosene and cow-dung fumes, and higher literacy rates as children can study after sunset.
Milaap partners with Mahashakti Foundation and Lendahand to bridge the need for financing to fund their projects. They currently need funds to take one step further and increase their reach to cover more energy deficient districts across the State. Milaap and Mahashakti Foundation are working towards making solar lighting affordable and available to households in rural Odisha. Through the current project, 600 families will gain access to a clean and efficient source of lighting- solar lanterns and help them overcome some of their current struggles.
Local partner Milaap provides a loan to the Mahashakti Foundation that must be repaid within 24 months.
|Company name||Mahashakti Foundation 3|
|CEO||Jugal Kishore Pattnayak|
Impact of this project
- With this investment 10 jobs are created
- With this investment 40 people are reached
About the risks
What are the risks of investing money?
The risk level depends on the specific project. Local partners cover the risk of currency exchange rates and defaults on Local Partner investments. They do this by maintaining financial reserves for this purpose. Aside from that, there is an option to claim their equity if needed. While these measures are intended to minimize the risk to investors, our local partners face risks of their own that could affect their ability to secure your investment. These include - bankruptcy - currency exchange rates - fraud - operational risks - political and regulatory changes - natural disasters or epidemics.
With direct investments, risks of default are not covered. As the risks are higher, so are the interest rates.
There is also some operational risk at Lendahand. An example might be that Lendahand is unable to find shareholders to finance their activities. In such a case, Lendahand will handle outstanding investments at the best of its ability. At the same time, our ability to legally address non-payment from local partners becomes understandably difficult.
How does Lendahand minimize the risks?
Every local partner must share our social mission to ensure local entrepreneurs can access affordable financing, allowing them to grow their business. Local partners must also have a 'track record'; they must have proven themselves as a reliable credit provider for SMEs.
For instance, this means a solid credit portfolio and enough buffers and equity to compensate for unexpected downturns. We also check the organizational structure of the portfolio company and how robust their (internal) procedures are. Finally, the investments must be in proportion to the total balance of that portfolio company. A healthy balance between effectuating influence and being independent is crucial. If you would like to receive more information on the financial indicators we employ, please contact us via email@example.com.
When currency exchange risks become too high for a local partner, Lendahand will urge the local partner to cover these risks. In some scenarios, the local partner is contractually obliged to comply with these demands.
Lendahand always conducts due diligence when companies request funding. The results can be downloaded on the project detail page. However, this analysis is not investing advice.
Does Lendahand provide a guarantee?
Usually we don't. Local partners take care of the repayment, even if (some) entrepreneurs are unable to do so themselves. If the local partner is for some reason unable to repay then there is a chance of partial or full loss of your money. For this reason, Lendahand only selects financially solid partners based on strict criteria.
For most direct investments, there is no guarantee. However, currency risks are covered.
Sometimes, and only for some direct investments in Africa, our partner Sida, part of the Swedish government, will guarantee a maximum of 50%. Read here more about guarantees with Sida. Projects with Sida guarantees are indicated explicitly on the project page.
Does Lendahand have a license or exemption?
Yes. The Dutch Authority Financial Markets (AFM) has provided Hands-on B.V. (with trade name 'Lendahand') in September 2016 with an investment firm license in accordance with article 2:96 of the Financial Markets Supervision Act (Wft). Placing orders on Lendahand's website is therefore an AFM regulated activity. Lendahand also meets its minimum capital requirements following its license as required by De Nederlandsche Bank (DNB).
Lendahand uses an exemption from an approved prospectus that is available up to EUR 5 Million per year.
How safe are my personal details?
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What happens if the local currency devaluates?
Our local partners and companies bear the exchange rate risks. We settle the investments, redemptions, and interest payments in euro.
Does Lendahand use a third foundation fund?
What happens with my money if Lendahand goes bankrupt?
If Hands-On BV (containing the brand name Lendahand) went bankrupt, trades between Lendahand and payment service provider Intersolve EGI would cease immediately. Intersolve will then transfer the funds in your wallet to your bank account (Note: if at this time the project you have invested in has been fully funded and the money has thus been transferred to the local partner, these funds will not be transferred back to your bank account). Intersolve will then, in consultation with a trustee, handle all repayments between the investors and entrepreneurs until the final repayment of the last project has taken place.
Additionally, Lendahand is part of the investor compensation scheme (ICS). This scheme aims to compensate individuals and small businesses with trusted money and or financial instruments (such as notes or options) to a licensed bank, an investment firm, or a financial institution. In case the financial firm is unable to meet its obligations arising from claims related to the investment service (in other words, if Hands-On BV is not keeping track of the acquired notes by investors in the Wge depot correctly). The ICS guarantees an amount of up to €20.000 per individual. For more information, go to www.toezicht.dnb.nl/en/2/50-202210
Why is Intersolve EGI handling my money?
What happens when a local partner goes bankrupt?
|Equity / total assets||50.00%|
|Write-off ratio last 12 months||0.00%|
|% investment amount in arrears (>90 days)||0.00%|