"Madura Microfinance is about transformation of rural people and not just microfinance"says David Appasamy,ED Madura Microfinance


David Appasamy took over as executive director of Madura Microfinance in the middle of May 2010. Just over six months into the job, his eyes sparkle and a distinct glow is visible on his face as he starts talking about transformation of people through Madura. He has served in leadership positions at Sify, Mudra, and ITC Welcomgroup in his corporate career. Running parallel with his corporate life was his social consciousness that pushed him to work for an NGO Asha Niketan. He is also the trustee of his family’s Appasamy Trust, and has seen transformation of the lives of villagers through the work done by it. So he is truly connected to Madura’s vision and deeply entrenched in its enabling role in transforming the lives of the rural populace. He writes a blog called Random Thoughts of a World Citizen where his worldview and experiences are shared. In a freewheeling chat with Venkatesh Krishnamoorthy, chief evangelist, YourStory, David talks about his career and his work at Madura.

YourStory: Thank you David for talking to YourStory. Please tell us about your educational and career background.

Education and Career

David Appasamy: My basic qualification is in hotel management and I completed my management education at the IIM-A much later. After doing hotel management here in Chennai, I joined as management trainee with Welcomgroup, ITC’s hotel’s division. After the training period, I forged ahead with a career in sales and marketing in ITC Welcomgroup. Initially, I was sales manager oof Welcomgroup’s Aurangabad Hotel based out of Mumbai, then joined the regional marketing office in Mumbai, before becoming sales manager of the SeaRock Sheraton. Later, I moved into advertising with Mudra DDB, and eventually became general manager of Mudra DDB, Chennai. It was Mudra which sent me to the IIM-A for MEP, the accelerated management programme.

When I was general manager, Mudra DDB, one of my clients captured my imagination with the way they worked- and that was Sify. This inspired me to work for Sify, whom I joined initially as general manager, corporate communications. I went on to become executive VP overseeing marketing, corporate communications and investor relations. This sums up my education qualifications and career prior to joining Madura.

The social connection

When I was working with Sify in Chennai, I was exposed to a home for the mentally challenged called Asha Niketan. This is where I met Hazel, a British lady who ran the home, at the church where we worship. When I met her along with my wife, I was totally captivated by her personality, and when she asked if I could work with them as a volunteer I accepted. And so I became a volunteer, helping them sell what they produced, the hand made calendars, greeting cards and baskets made out of papier mache.

I was invited to join the Governing Council that manages the home after a couple of years. The home is part of L’Arche, meaning ‘The Ark’, a global network of such homes worldwide. L’Arche was started in France by Jean Vanier, who found there was no institution that could really look after his son, a mentally challenged boy, with the love and attention that he deserved as a human being.

Seven years after my involvement, first as a volunteer and later as the member of the governing council, I was requested to take up the position of chairman of the governing council. I served as the chair of the governing council for 7 more years guiding the home in all its endeavors. But when travel became intense in Sify with increased responsibilities, I stepped down from my position at Asha Niketan, and let others carry on the work.

CSR at Sify

At Sify, I was assigned to oversee “Alambana’, meaning ‘support’ in Sanskrit, the CSR initiative of Sify. Alambana is for bright children have to drop out from schools after completing 10th grade as their parents could not support them. These children get frustrated as their ambitions are crushed due to the poverty in the family. So, Alambana puts such children, about 20 per batch, through a 3 month programme where they are taught spoken English, grooming & personal hygiene, personality development and computer skills. I was in-charge of it for 8 years and we saw some incredible things happen. By the end of the three-month programme, the children were transformed into confident young adults. All of them were placed in jobs at the end of the programme and earn a decent salary to support their families.

As head of Appasamy Trust

Our family runs a trust, called the Appasamy Trust, started by my great grandfather, which works in villages around Thirunelveli, where my roots lie. The will of my great grandfather mandated that a male heir be the trustee always. It was governed by different people and around the time we settled down in Chennai, my father was the trustee. When my father passed away, my cousins and brothers together decided that I should be the trustee.

My father had entrusted the execution of the work of the trust with the Madurai YMCA rural development project. They have a full fledged organization involved in carrying out the work. From 13 to 15 villages which we worked in during 1989, today we work in 217 villages, and 197 of these have self-help groups to whom micro-finance loans are given. YMCA formulated the groups and linked them to the public sector banks. But as the trustee, I was aware of its activities and progress, and was responsible for the trust as a whole.

So you will find that my professional career had a separate growth track and my involvement in social activities had a separate path of its own- it ran parallel. I was moving from Sify after 10 years as I wished to have an opportunity to head a business, and at this point I happened to become aware of Madura. I liked what they were doing at Madura as the essence of it was the same as what I had been doing all along my career.

YS: Which part of your career has been longest?

David: Interestingly, all of my career stints have been of equal length of around 10 years with ITC, Mudra DDB and Sify.

YS: What is the secret that helped you climb up the ladder to different leadership positions?

David: In retrospect, I believe it is sincerity and commitment that will take you to higher levels. The job should be approached with a perspective where value is added by you on completion of the task, beyond just completing it. The other thing is the way you work with the team, with your boss, how you instill confidence in him to entrust you with responsibility rather than complaining about him.

Interesting anecdote

After management training, as sales manager of the Aurgangabad hotel, I was based in the regional marketing office in Mumbai as it was the major source market. The regional marketing manager told me, ‘You are here because you have been sent here not because I wanted you here.’ He was the son of a Major General in the Army and obviously he took after his father in his work ethics. There were 4 to 6 women sales executives with years of experience, and I was the novice there. I took that as a challenge and within a short span of time I proved to be more productive than the women, won his and the others trust and respect, and became the number two in that office.

The learning is ‘Don’t expect your boss to do things for you. Instead work in such a manner where you gain his trust and confidence.’

The Madura coming: Choosing Madura Microfinance

YS: How did working with Madura happen?

David: When I was looking for a change in my career, I discussed my career options with R Ramaraj, the founder, and former CEO, of Sify. He suddenly asked me if I had considered microfinance as an option. Frankly, till then microfinance was not even in my list. After considering what I had done with the trust and with the other organizations so far, I believed it would be the place where my career and my desire to contribute to society converged. He was a director on the board of Madura, and forwarded my resume to the board as they were looking for an Executive Director.

He added that the board had meeting candidates who had experience in banking. The board scrutinized my experience and capabilities for around two months, and in every meeting, I was impressed by the quality and the caliber of the people I met. I knew then that this was a place where I would enjoy working. But I was looking at other options as well and I was offered the opportunity to head a brand consultancy at Tata ELXSI. It is was an interesting position, but my heart was set on working with Madura.

YS: Your experience with Madura and its microfinance concepts?

David: To start with, Madura Microfinance is nothing like any other microfinance firm. Unlike other companies whose missions are focused on their own growth, size or profitability, our mission focuses on transforming the lives of the poor in rural areas. Our mission is written in Tamil because our field staff enunciated the vision of the late Dr K.M. Thiagarajan, the founder of Madura Micro Finance, into a mission statement.

Our mission’s focus is on bringing about socio-economic growth in rural areas by; identifying those who need to progress in life; by bringing about an awakening, raising of perspectives and aspirations; making available training and development to them; so that they can be self-employed with financial assistance; and so there is transformation in the family’s economic status.

The finance, you will see, is a small but critical, part of it. It the awakening which is the training we will impart to people through our micro education initiative. Finance is taken care by microfinance. For self-employment and the ability to grow, we have the micro markets initiative. These three combined together help in bringing about systemic change which can transform the families of the poor.Microeducation and Shakti Pirakkudhu

We have been continually developing the micro education initiative of the company. We have 200 video training centres across Tamil Nadu, as 70% of the people are illiterate, but they can watch and learn using audi visual programmes. We do that in an innovative way with the launch of a full-fledged movie, Shakti Pirakudhu. In the movie you will find there are inflection points where Sundari, the protagonist, learns how to do a business.

We show the movie which follows Sundari’s trials and challenges before she succeeds in her business- there are inflection points woven seamlessly into the film that show key points in her learning how to manage her business. The women identify strongly with her and make an emotional connect with her. We then show them training modules that relate to the inflections in the movie, and illustrate how business is done.

As part of micro markets, we have a classifieds paper, which is free for our members. If a woman, who is making pickle and selling it in nearby streets, advertises it in the classifieds paper, then women in the next village contact her for supply and her business can grow along with the increase in production, distribution and sales. We are also doing trade shows for people from the district to see what our members do, so they can buy the products, distribute them or make other sorts of connections.

Impact of trade shows

YS: What has been the impact of it?

David: We have begun this process and the classifieds is just 6 to 7 editions old. The trade shows will start in December 2010, with five held before March 2011. The significance is in establishing contacts, enabling them to grow. It’s about the improvement in the condition of the people who come to us. Transformation is a slow process, so a year from now we will be in a better position to gauge its results.

A beneficiary becoming a Cluster leader handling Rs. 7 crore loan portfolio

YS: Interesting anecdote?

David: Madura’s micro finance has been available for fifteen years and, over the years, we have seen a lot of success stories of our borrowers (whom we call members) because of individual ability. Through these initiatives we are looking at developing and transforming the lives of the majority rather than such individuals who may have greater exposure and initiative. But what is encouraging to me is when we see our mission’s effect on women who have gone through five loan cycles in ten years.

Transformation does take time. We find the difference takes at least 3 years to become noticeable. Many of women who joined as members, i.e. borrowers have chosen to work for us taking up various roles, to bring about the transformation which they have experienced, to more people. There is this woman who works with us as a Cluster Manager outside Madurai. Over 10 years ago, she was doing coolie labour as her father was an alcoholic. She then took loans from us and succeeded in her business.

She then joined us as a member welfare associate (MWA), went on become a mentor supervising other MWAs, and is today a cluster manager managing a large team of people. She coordinates a team of 30-35 people, with a Rs. 7 crore loan portfolio. Not only did she completed her schooling, she did her graduation, post graduation and is now pursuing a degree in banking and finance. One can clearly see the transformation in her life.

About three months ago, I went to Kadayam, a village near Tenkasi, where we met the leaders of our self-help groups who have been with us for around 8 years or more, and having their own successful businesses. Some, such as the woman with the milk distribution business, employ their husband too! Some, like the one who bought an auto rickshaw with her last loan, put their husbands on their feet making them self-employed as well! This is very unusual in the rural society in Tamil Nadu and are examples of transformation we are talking of.

There are photographs that demonstrate the impact to a viewer.

YS: Do you help those women who aspire to study as well?

David: We have been discussing initiatives like educational loans, but we find that women tend to educate themselves when they see the immense possibilities that knowledge can bring. In some areas we are running adult literacy programmes. We are looking at micro education primarily for the development of their businesses. We are also looking at a pilot for the skills development of children.

YS: Would you advise a for-profit or non-profit venture for budding entrepreneurs?

David: I would advise them to have a very clear mission initially. Once you are very clear with what you want to achieve then you should look back to develop the business model you need to effectively make it happen. The focus should be on delivering effectively on the mission. If you decide to be an NGO, you have to rely on the organization that is giving you the grant, and satisfy the organization’s purpose which may be different from your mission.

On the other hand, if you have the courage to say that I want to be for-profit, it should be for-profit to make the business sustainable and scalable, and to drive towards achieving the mission effectively.

YS: Can you tell us about your TEDxChennai experience?

David: Many people say that in today’s world it is difficult for a bunch of people to come together and work together voluntarily with a common goal. TEDxChennai is a hugely inspiring example of it being possible. I enjoyed working with TEDxChennai last year. This year I was not actively involved but was on the e-mail thread and occasionally contributed to what was being discussed.

YS: What are your hobbies?

David: I used to be a good painter. I read whenever I can, I do read widely in terms of articles: I am interested in science and technology and development of new things and in the Internet. I am a social network enthusiast. I do lot of reading online on wide variety of subjects, love listening to music, watching movies and good food. I also have a lot of interest in design. photography has been my passion and of course with the iPhone, it is very easy to take pictures and share them. I also have a small Olympus with some 50 albums on Facebook profile with travel photography.

India can shine if the 600 million rural population can be integrated with the mainstream economy

On a closing note, David Appasamy says, “Often in the last 5 years, there has been this question that if China can have a growth of 11 to 12%, why can’t India have similar growth? I think it is because all the economic policies, that have been very good, but focused on the formal economy that is more industrial and urban in nature. So liberalization has fostered industrial and economic growth, a lot of jobs, attracted investments into different industry verticals. But it is primarily an urban phenomenon that does not directly touch the lives of the 600 million people in the informal economy in rural areas.

I believe unless we are able to create the systemic change that will integrate the productivity of the 600 million people in rural areas, so that they are contributing to India’s economic growth, our GDP growth rate will not reach those levels“.


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