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India is a land of arts and artisans. It has earned name and fame for the wonderful artistic
works and materials manufactured by the committed and devoted artisans. It is a matter of
great pleasure to witness that artisan sector is not confined to a few states of the country but it
encompasses almost all the states of the country. All of us know that rural artisans play an
important role in the economy of the country like India. Artisan units use locally available
raw materials, work on them with simple tools and sell their products in a local market, or if
any market linkage is available then sell in organized or modern markets. Artisan sector plays
an important role in the pattern of industrial development .The development of artisan is a
means of promoting large scale employment and is also a means of meeting the demands for
consumer goods. The industrial policy statement of 1980 states that ³The government is
determined to promote such a form of industrialization in the country that promotes such
form of industrialization in the country that can generate economic viability in the village´

However in recent years these units have come across with several problems, particularly
after the manufacturing of machine products. Of the various problems that the artisans have
faced the major hurdle is that of finance. On account of the decay of the patronage by the
Rajas, Maharajas, Jamindars and the exploitative characters of local money lenders, the
artisans have felt dearth of finance. Apart of the major problem of finance they face the
problems such as lack of skills, less exposure to info & tech., lack of formal training, absence
of non-farm policy, marketing support, non-competitive products, unable to sustain
competition, application of traditional left over technologies etc.

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DINO (Dinancial Information Network and Operations) is the largest Business Correspondent
in the world. The company was founded with the single objective of building technologies to
enable financial institutions (DIs) and to serve the under-served and the unbanked sector and
also to service the technology requirements of entities engaged in servicing the bottom of the
pyramid customers. In India it is present in 233 districts of 22 states with a customer base of
nearly 1.8 crores. The company provides end to end technology and operational solutions to
financial institutions, revolutionizing the way their services reach the base of the pyramid
citizens. DINO has its own network of agents (Business Correspondents) at ground level and
also works with several partners to reach the remotest parts of the country. These business
correspondents are called as Bandhus in their respective areas and the company is having
more than 10000 such Bandhus all over the country and some of them are women from the
villages itself. Company has realized that these customer service providers are a very critical
part of the delivery chain and customer experience. Hence company invests aggressively in
their training, insurance benefits and has a code of conduct for them to ensure lower risk and
better customer experience. There is certain criteria for their selection and once selected they
are given training on the basic aspects of finance such as book keeping, budgeting, cash
management etc.The training also gives equal emphasis on people management and other
skill set building.


    
The study was conducted to check the feasibility analysis on how DINO can use its strong
distribution of Customer Service Providers to make appropriate linkages in terms of Dinancial
and Marketing for the rural artisans (Kondapalli Toys Makers) and to replicate the same
model in the entire country.

The study also involved the probable plan of action and strategy for the company through
which it can help the rural artisans as well as help its customer service providers to increase
their own income.

    
The study was conducted in the Krishna District of Andhra Pradesh and the target artisan
community selected was Kondapalli toys makers .The reason for this selection was that DINO
as a company is well established in the entire district with more than 1100 customer service

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providers and the place is close to the markets such as Vijayawada and Hyderabad in order to
make forward linkages.

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Data was collected on techno-economic status of Kondapalli artisans of this region to find
their educational, economic, technological levels through personal interactions with them.
The field study has been undertaken with the help of a questionnaire and a sample of 150
Kondapalli toys artisans was selected for eliciting relevant information from them .Besides
this officials of institutional credit agencies and the NGOs working for rural artisans were
interviewed personally to elicit their opinion on certain issues having bearing on the study .

     

The size of Indian Toy industry is about Rs.4000 crores of which Rs.1500 crores the
organized sector while Rs.2500 crores comes from the unorganized sector. Indian Toy
industry is characterized by small-scale establishments and is highly labour intensive. There
are approximately 2000 manufacturing units consisting of micro (1500 units in cottage
sector) small & medium (450 units) and large (about 20) units operating in the sector.

Kondapalli toys are being famous for being eco friendly and different from others .Made out
of softwood known as ³Tella Poniki´, the toys of Kondapalli utilize sawdust, tamarind seed
powder ,enamel gums and watercolors in their production. Kondapalli artisans are famous for
their output of life-like, thematic carved sculptures depicting rural life, deities and animals.
The artisan families of Kondapalli and surrounding villages near Vijayawada belong to a
community known as Arya Kshatriyas, who had migrated to Kondapalli from Rajasthan in
the 16th century.

The toys have a definite grammar of color composition of their own, and a reflection of
native rural life. The theme of Kondapalli toys is of three distinct categories: animals and
birds, male and female figures depicting various forms of rural-life and mythological figures.
The uniqueness of the toys of different animals, birds and human figures reflect dignity of
expression. Traditional toys include figures from Hindu mythology and popular village
themes.

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The organization structure of the company is similar to PRI institution who works in the rural
areas and it is very important to understand it for the implementation of the above project.

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It was found that artisans in the area were not aware about various rural development
functionaries such as R&D institutions, financial institutions, marketing institutions and
training institutions. Some of the other key findings of the study were as following

Α Almost 64 % of the artisans family are leaving under the below poverty status in the
area.
Α Of the artisan community almost 40 % are now working under National Rural
Employment Guarantee Scheme and left their toys making work.
Α More than 65 % of the artisans are facing the problems of finance and not able to
scale up their operations and marketing linkages due to shortage of credit.
Α There are very few artisans who are actually sending their toys in the outside market
and rests are dependent on the local markets for the same.
Α Some of the artisans have taken loan from the local money lenders at an interest rate
of almost 60 %
Α Almost negligible artisans are covered with insurance schemes and this percentage is
even less than 20 %

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 Α There is a society named as ³Kondapalli Toys Manufacturers Mutually Aided
Cooperative Society´ which is supposed to take care of the marketing activities of the
toys makers but this society also severely needs funds for existence.
Α The society doesn¶t even have its own website for the marketing of the toys.


    


 
The approach which was suggested to DINO is the MARTS 3 M (Microfinance, Micro
market and Micro planning) livelihood promotion model as it was evident from the base
study that most of the problems can be solved by providing financial and marketing linkages
for the toys making artisan in the region and for this planning at the micro level is very
important and once successfully implemented the model then can be successfully replicated
in the other parts of the country. The other reason for adapting this model is the nature of the
company where which can easily leverage upon its network with different banks as it has
already tie up with banks such as Axis bank and other Public Sector Unit banks (Union Bank
Of India) and if we seen the contribution of Axis bank which is the major partner or client of
DINO in the district is less than 2 % to the total credit disbursement.
The unique feature of the implementation of the entire project will be that the main centre of
activity or planning center will be in the villages in the form of customer service providers of
the company .So they will be responsible for all the activities which are to be carried out in
the different phases of the project .So there will be ultimately capacity building of the rural
people and it will also increase the overall income level of the artisans as well as the rural
representative of the company so it will ultimately result into multiplier effect in the local
area and economy.

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Kondapalli toys *To get proper The strength lies Dacing financial The toy industry
makers financial and in the making of as well as has a great
marketing unique products forward linkages demand in the
linkages to of its type problems local ,national
improve the and international
current situation markets
*Skill
enhancement &
modernization
in the current
production of
toys
DINO *Increase its *It is the largest Currently only Can diversify
operations in its business in in providing itself into other
through linkages the country. financial form of viable
with proper *Good services and feasible
banks reputation business
*The among the banks
implementation as well as
of the project government
will increase the
current
remuneration for
all the customer
service
providers in the
area as it is
based on the
amount of

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 transaction done
by them

Axis bank * Increase its One of the Less number of Can use the
customer base as major private physical artisan base to
well as market bank in the branches increase its
penetration in region available in the penetration
the rural area. region through suitable
* Cost reduction products
in the operations
as it will be
working with
the DINO with
business
correspondent
model
* Increase in the
contribution to
the credit
disbursement
which is
currently less
than 2% for the
entire district

Kondapalli Toys To see the best *It is also facing Can be use as
Manufacturers that can happen financial crunch effective
Mutually Aided with the toys *Heavily medium for the
Cooperative makers dependent of development of
Society external sources the artisans

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 3)Introduction or received by the actual money
induction to different artisans invested in the
banks offerings or business
products 4)Money invested for
4) Customer productive purpose
acquisition though by the artisans
KYC norms
5) Providing or
disbursing the
amount
6)Keeping the
records of all the
transactions done by
the artisans

Skill up gradation of Collaboration with 1)Number of such The timeline of this

the artisans as well as the organizations workshops phase will be of 
the business such as happening and the   as this is the
1) The Design and number of footfall of most important phase
Technical artisans to these of the entire
Development workshops implementation
Centre(Bangalore) 2)Change in the skill
2)Crafts Council of set of the artisans
India
3) National Institute
of Dashion Tech.
Carrying out
workshops with the
help of above
mentioned
organizations

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 develop new and
striking designs
Making marketing 1)Dormation and 1)Number of such tie The time line for this
linkages maintenance of ups phase will be kept as
website   months
2)Tie up with 2)Number of toys
organizations such as sold after all these
Chitrika activities carried out
3)Convenience its
partners to use these
toys as corporate
gifts for the festivals
4)Convenience its
employees to do the
same
5)Dinding linkages
on a national level

 
 
    


There will be an estimation for the total amount required for the completion of the project and
budget will be allocated to carry out different activities .Once the artisans will get the amount
from the bank there will be formation of common fund by keeping a minimum amount that
will be contributed by each toy maker .Attempts will be made to form partnerships with the
corporate working in the area to help for the same reason. The DINO as company will also
invest certain amount in the entire project as it will involve income increase activities of its
customer service providers as they will be the centre of activity at the village level for the
planning and execution of the entire project.
All the above factors combine to create a unique value proposition for artisans & at the end of
a given financial period when we equate the costs incurred with the revenue generated we
shall be able to gauge the success/failure of the model. The model has been proven profitable
& sustainable in the various financial evaluation parameters with the breakeven point being
achieved in the 1st year itself.
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