The winter's tale in the life of an Indian is often one of helplessness and dependence. Gopal, 70, who sold herbs from forests in Chhattisgarh's Raipur district all his life for a living and married off his three daughters, today spends most of his time on a charpoy feeling the cold of his ripe age.
In Rajasthan's National Rural Employment Guarantee Scheme work sites, one finds 70 year olds cutting rocks to earn Rs 80 a day.
There are 284 million Indians who are not covered by any social security blanket to support them in their old age.
About 10 million are lucky to be covered by the employment provident fund and another 20 million by the government pension scheme.
Last year, a company called Invest India Micro Pensions Services decided to reach out to the millions who are uncovered. Its target was 150 million low-income people among the uncovered.
IIMP tied up with SEWA and UTI Bank's pension scheme to pioneer a micro-pension project in Ahmedabad. Finance Minister Chidambaran launched the scheme.
The funds are invested in UTI Retirement Pension Fund, regulated by Sebi, the capital markets regulator.
Today, IIMP and UTI are moving into more states. In Andhra Pradesh, they have tied up with MFI Sharda to convert the thousands of MFI (micro-finance institution) beneficiaries into pension investors.
In Delhi, another MFI has decided to take the plunge with IIMP. It is soon beginning operations in Tamil Nadu and Kerala. IIMP currently has a customer base of nearly 100,000 and targets 3 million members over the next 3-4 years.
Micro pension is a unique initiative under which the pension sector joins hands with the development sector and the private sector to ensure that low-income workers save voluntarily.
The money is safe, says IIMP CEO Ashish
Agarwal, as people invest long term. According to IIMP, the country spends $25 billion a year on a generous wage-and inflation-indexed pension for government servants and in contrast just $350 million on pension worth $10 per person for the destitute old under the National Old Age Pension Scheme.
The savings-based market-linked scheme of IIMP has no subsidy element.
The scheme has 45,000 beneficiaries in Ahmedabad who are saving whatever they can every month. These are milk sellers, vendors, and even housewives linked to SEWA.
In Delhi, IIMP has tied up with two NGOs and will replicate the Ahmedabad story.
Another stream of pension investment is happening with government participation.
In Rajasthan, the government stepped in to contribute to the pension savings of the poor when it launched the Viswakarma pension scheme last year.
A labourer saves Rs 80 a month and the government puts in a similar amount. If he does this for 25 years his corpus will double and he will get Rs 2.5 lakh, which will be about Rs 2,000 a month for 10 years.
The cost to the government every month if 500,000 people join the scheme is a mere Rs 50 crore (Rs 500 million).
The company behind this is Invest India Micro Pensions Ltd, which is now trying to replicate the scheme in other sates.
Madhya Pradesh has already announced a Khushabahu Thakre pension scheme, while Maharashtra, Karnataka and Orissa have evinced interest in such schemes.
The finance ministry has appointed a Pension Fund Regulatory and Development Authority, which will soon roll out a National Pension Scheme for the informal sector or for whoever wants to join.
But this is still some time away.
Meanwhile, Sharda in Andhra Pradesh, an MFI in Delhi and SEWA in Gujarat show that the micro-finance sector is finally ready to offer long-term services rather than just loans to its vast network of beneficiaries. Which is glad tidings indeed.