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 Computer Munshi
A ‘munshi ‘ with a difference
Introduction
With the mission of enhancing livelihoods on a large scale to empower poor people, PRADAN has been working in some of the very poor States of North India through decentralized projects for over 15 years. Identifying and organising poor women into SHGs, building their capabilities to enhance incomes, linking them to government’s poverty alleviation programmes, etc., are the broad strategies followed by 19 project teams, each operating in a district or a few blocks within or across districts.
Approach to SHG promotion
The approach that PRADAN has adopted requires that the groups become independent from PRADAN in a reasonable time frame so that the staffs is free for their core task of livelihoods promotion. The road map that PRADAN has prepared for the growth of an SHG deems that the group be free of any assistance from PRADAN, even for getting loans from banks, in about 1 ½ to 2 years. This requires that for routine maintenance functions such as accounts and MIS the group has to be on its own within the first three to five months.
Need for strong systems
If the SHGs have to be on their own for routine maintenance functions, it requires that they are equipped with strong, yet simple and user friendly systems, especially for accounts and MIS because they are the most important ongoing function in the SHG.
The Issue
The problem that most of the accountants face is in posting, consolidating and in preparing monthly statements. The accountants can do the basic data entry in the groups but the higher order functions attract a lot of mistakes.
Another major issue that PRADAN professional faces due to badly maintained group accounts is that the project MIS on the SHG is never up to date or complete. Updating office MIS is quite a labour intensive process that involves extensive group visits by the professional to collect data first hand. The group accountants are not able to prepare MIS statements for the group and even if they do the professionals do not have enough confidence in the statements that are prepared.
Computerised accounts
Keeping the set of fundamental principles such as simplicity, user friendliness and timeliness in mind, and the practical realities, it is proposed to introduce a new system of community based computer entrepreneurs who would provide accounting services to the SHGs for a reasonable payment. His/her scale of operations would be at a level of a minimum of 100 SHGs, expandable up to 200 SHGs, resulting in a higher amount of return, which will attract him/her to adopt this as a viable employment to be taken up in the long run.
The computer will be placed in a relative more developed locality, with electricity supply for about 5 to 6 hours a day (department supply plus back up battery).
Computer Munshi
The computerised accounting system in PRADAN is conceived as a community based system in which a computer operator, to be called the Computer Munshi (CM), equipped with a computer will provide accounting services to the SHGs to earn a decent remuneration at the end of the month. The SHGs will continue to have an accountant nevertheless who would enter the RMTS (Regular Meeting Transaction Statement) in the weekly meetings. But this accountant will be of lower skill level, like the kind who are available everywhere. He/she will be trained to make entries in the RMTS and in the passbooks. The system will be that this group accountant will enter the RMTS in the meeting and carry it to the CM who will check the data, and enter it in the computer immediately. Then the CM will provide the processed data to the SHG for a fee. The whole set of sheets will be in the local language so that the group members can use them. The CM can also supply information to PRADAN on demand, for a charge. Thus the objective is to have a community based computerised accounting system for the SHGs that is sustainable.
The computerised accounting system will be based on the SHG accounts software named McFinancier that has been developed in consultation with PRADAN.
Tasks of the various actors
Group accountant:
- Fill up the RMTS
- Fill up each pass book
- Write the minutes book
The filled up RMTS goes to the Computer Munshi through a collection system (Post boxes, messengers etc)
Computer Munshi
- Check the RMTS that has come from the group for mistakes.
- Enter the corrected data sheet into the computer
- Prepare the group data consolidation and trial balance once in a month
- Give the statements to the group –monthly trial balance; and statement of member balances, statement about bank loan on a weekly basis
- Receive payment from the group
- Provide data to PRADAN for a charge, once a month.
PRADAN professional’s role
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Introduce the books (minutes book, pass book) and RMTS in groups
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Help the group identify the accountant and thoroughly train him/her in maintaining RMTS
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Set up systems in the teams for the weekly data from the SHGs to reach the Computer Munshi after every meeting
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Hold monthly training programmes on accounts entry, trouble shooting etc
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Make aware the members of the SHGs on the importance of accounts and transparent maintenance of the system, and also the necessity of paying the accountant
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Recruit, train and equip the Computer Munshi to take up the role of the community accountant
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Establish a sustainable business relationship between the SHGs ands the CM
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Regularly update skills of the CM, counsel him on how to improve services, provide on-job assistance
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Carry out random checks on the financial statements that are produced by the CM for the groups
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See that the groups are regularly providing the data to the CM and are getting prompt outputs
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See that the groups are regularly paying the CM and solve any conflicts that may be there
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Constantly monitor the total system through Cluster meetings and occasional group visits.
Uniqueness of the system of Computer Munshi
- Maintenance of SHG accounts and MIS through a community based and financed network, thus SHG accounts autonomous of the NGO, yet accurate and timely (the only attempt in the country as yet known)
As of today, even though the programme of SHGs is the largest microfinance programme in the country, the quality of the groups, especially of systems, has not been a prime concern of the various stakeholders. The attention has been mainly on the number of groups; quantum of bank linkage etc. and the crucial questions on quality have never been asked. Thus the current project attempts to put the attention back on the quality of groups especially of systems. In majority of the SHG programmes it can seen that either the NGO staff themselves provide accounting services to the SHGs; or the NGO staff are not bothered about the quality of SHG accounts, because the staff are pressed with other activities that are more developmental in nature.
The challenge that has been taken up here is to ensure that the quality accounts maintenance is ensured, but based on a community based system, rather than the same remaining the concern of the promoting NGO, ad infinitum.
The argument is that accounts maintenance of SHGs is too important to be dependent on an external system such as that of the NGO. And for the NGO this is too non-developmental in nature to be engaged in at all. Thus we need a system owned and supported by the SHGs, where their routine tasks are carried out efficiently and the quality also is maintained.
This system also enables the PRADAN staff to have access to information as and when required. The PRADAN staff has to do no extra data entry work to have access to the information.
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Accesses to information by other stakeholders, such as banks, that will enable them make prior assessment about the health of the groups.
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Creates a computerized base for any future IT interventions/improvements.
The system being designed is the basic framework. It is designed around the basic back end software such as the McFinancier. Since it is a PC based system, the basic data entry in the SHG meetings is done manually. So there are manually maintained components in the system. As technology evolves there are possibilities that the front end, that is, the data entry in the SHGs also could get automated. The present system would be able to take in such changes in technology without making redundant any of the existing components. It can be dovetailed with any other services (health etc) for information transfer.
The system as it is being designed is also a system for online data transfer from the SHGs to the centralized computer and back. Various other data transfer requirements could be dovetailed on to this system with only incremental additions. These could be related to information on services, production information, market information, etc.
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