Every sunrise sector depends on talented and innovative individuals to cut the path that others subsequently follow. This has been the norm in every sector. Microfinance is no different. At a time when the regulatory architecture for the sector is still very hazy and last-mile connectivity a major hurdle for large players, there are a handful of people who are braving the odds to push forward their vision of an empowered rural India. All the individuals profiled below are highly qualified and mostly foreign-educated. All of them could have got cushier jobs in big cities, but each of them chose to get his/her hands dirty in the boondocks of the Indian hinterland because they saw potential at the bottom of the pyramid. Their paths are different. ICICI Bank's Nachiket Mor pioneered a new model that allowed large banks such as his employer to enter the microfinance sector. Some others had to borrow money from friends, family and foreign donors to start their ventures. But these are teething troubles that all pioneers face. The important thing is that they've opened up a sector that can, potentially, change the face of India's rural heartland.

Nachiket Mor/42
Deputy Managing Director, ICICI Bank.

ICICI Bank's Mor: Made microfinance bankable

He is credited with opening the floodgates for this sector. Mor's partnership model, wherein the role of microfinance institutions (MFIs) changed from holders of assets to servicing agents, transformed the sector by removing the hurdle to its growth-the small size of MFI balance sheets. Under this model, the loan documentation is done in the names of the bank and the borrower; the MFI is merely a service provider who disburses and collects money as an agent in exchange for a service fee. This allows even small MFIs, with very small balance sheets, to become partners in the process. Other banks such as HDFC Bank and UTI Bank have also experimented with this model. Result: the total loan outstanding of the top 20 MFIs grew 215 per cent in 2004 to Rs 423.77 crore when the benefits of the partnership model kicked in, compared to Rs 134.43 crore in the previous year. The growth rate in the previous three years had been 56 per cent, 73 per cent and 87 per cent, respectively. Little wonder, then, that this is called the "Nachiket Effect" in microfinance circles. ICICI Bank now has 102 such partners through whom it manages its microfinance portfolio. However, new RBI norms seem to place a question mark on this model; the final word has not yet been said on the matter. Mor, a PhD in Economics from the University of Pennsylvania and an MBA from the Indian Institute of Management, Ahmedabad, has been a member of ICICI Bank's Board of Directors since 2001.

SKS's Akula: His MFI has 183 branches, and he's found mention in Time

Vikram Akula/38
Founder and CEO, SKS Microfinance

He was only three years old when he left Hyderabad and moved with his parents to the US where he stayed for years. Back in Andhra Pradesh since 1997, he now manages to speak good Telugu, albeit with a heavy American accent, with his staff. Akula, who has done a stint as a consultant with McKinsey & Company, figures in Time magazine's list of 100 most influential people this year. His is a quaint story. He raised $50,000 in 1996, by hosting tea parties for about 356 friends and relatives in the US, and set up SKS. Today, his MFI has gathered enough critical mass to catch the attention of ace venture capitalist Vinod Khosla, who has invested in its equity. SKS, with 183 branches spread across 11 states, has disbursed Rs 484 crore, and is among the fastest growing microfinance organisations in the world. Its growth in the last fiscal year: 160 per cent; this is expected to touch 200 per cent this year. Akula is a PhD in Political Science from the University of Chicago, has a Masters degree in International Relations from Yale University, a Bachelor's degree in Philosophy and English from Tufts University, and he has also attended a graduate programme on religion at Harvard.

G. Padmaja Reddy/38
Founder Director, Spandana

Spandana's Reddy: Is aiming for a client base of three million in five years

Reddy founded Spandana as an NGO in 1997 and converted it into an NBFC in 2004. This MFI has grown rapidly, its disbursals rising from Rs 4 lakh in 1998 to Rs 89.4 crore in 2004 (when it became an NBFC) to Rs 639 crore in March 2006. Cumulatively, it has disbursed about Rs 1,470 crore to 850,000 clients. Reddy now wants to attract more professionals into the company and is also keen on roping in a strategic equity investor. "I want someone who is serious about expanding this business; I'm willing to offer a stake in this venture and am also open to making organisational changes if required," she says. This may take some time, but Reddy is clear about her more immediate goals: disbursals of Rs 5,600 crore and a client base of three million over the next five years.

BASIX's Mahajan: Has helped over 300,000 households

Vijay Mahajan/52
Founder Chairman, BASIX

Vijay Mahajan is considered the veteran of the Indian microfinance world. His professors at IIM-A, Ravi Matthai and Ranjit Gupta, founders of IIM-A's Jawaja Rural Development Project, opened his eyes to the potential of the sector. In 1983, Mahajan established, PRADAN (Professional Assistance for Development Action), an NGO that, in 23 years, has attracted 1,200 young professionals who now work at the grassroots level across rural India. In 1995, Mahajan, conceptualised BASIX as a "new generation livelihood promotion institution" and had it up and running by mid-1996. Till April 2006, when he stepped aside as its CEO, BASIX had helped support over 300,000 households in agriculture and non-farm activities and extended micro-credit worth over Rs 650 crore. Mahajan clarifies that BASIX goes well beyond micro-credit and is meant to offer a "triad" of livelihood promotion services (including savings and insurance services, agricultural and business development services and institutional development services) to rural producer groups. Mahajan is an alumnus of IIT Delhi, IIM Ahmedabad and the Woodrow Wilson School of Public International Affairs at Princeton University.

M. Udaia Kumar/48
Founder & Managing Director, Share Microfin

Share's Kumar: In 1992, no one was willing to lend him money. Today, he has one million clients

Ours is the world's sixth-largest microfinance programme," booms Kumar. It's been a long journey. In 1992, no donors in India were willing to lend him money. He began with no capital and a Rs 18-lakh soft loan from Gramin Trust of Bangladesh and Asia Pacific Development Centre, Malaysia. Today, he has one million clients and cumulative loan disbursals of Rs 1,900 crore. Despite the setback in Krishna district, where the offices of some leading MFIs (including his) were sealed by the district collector for alleged unethical practices, Kumar feels there is still scope to expand the market in Andhra; he is also exploring the possibility of expanding into other states. "We have to be viable and sustainable and be able to recover our costs. To do that, we need to move to other regions as well," he says. Little wonder then, that his immediate goal is to cover 10 states (he is currently present in only five) in India by the end of this financial year and expand his client base to 1.2 million.