Kuldip Maity

In the last blog, I started discussing artificial intelligence. There is no denying that artificial intelligence is fast becoming an integral part of our lives, driven by unprecedented technological advancements. However, as we embrace the benefits of AI, is it fair to assume that all is good with embracing technology? I had said that it would need another blog to discuss that. So here it is.

In the microfinance business, where empathy is as important as financial transactions, there is a growing concern that we are gradually losing the human touch. We must balance technological innovation and preserving our innate human connections. And that is where the problems lie. It is not with the technology or the processes; it may be with the basic nature of humanity where we tend to take the easier route instead of traversing the difficult path. For example, shall we still physically meet a person in distress or settle for a simple dry telephone call?

Our ability to form emotional bonds and connections with our customers sets us apart, enabling us to handhold them in their journey of climbing the financial pyramid. Whether it's a heart-to-heart conversation, a compassionate gesture, or a simple touching word, these interactions create profound experiences and foster a sense of belonging. Contrary to how AI operates, the human touch goes beyond logic and efficiency; it encompasses empathy, understanding, and the ability to provide comfort and support during tough times.

What concerns me is the risk of dehumanization, which may lead to the erosion of interpersonal relationships between us and our customers. I will need to ensure that there is no lack of emotional intelligence that plays a vital role in our customer care. After all, despite its sophistication, AI cannot truly understand and reciprocate human emotions.

We must keep encouraging more face-to-face interactions, promoting empathy and emotional intelligence, and fostering genuine human connections that will counter the potential negative impacts of excessive AI reliance. Investing in human-centric education and training is essential. Educating our team about the importance of human connection by cultivating social skills will help us mitigate the risks of low human interactions.

Another important part is the ethical considerations of the development of AI-based systems. Priority should be given to algorithms that respect privacy, maintain data security, and uphold human values. By embedding ethical guidelines into AI, we can ensure they remain human-centric and align with our moral compass.

We should carefully focus on developing AI systems that augment human capabilities rather than replace them entirely. AI is supposed to work alongside humans so that we can leverage the strengths of both, ensuring a balance between efficiency and emotional connection.

There is a considerable buzz around the growing field of artificial intelligence and how AI will take over hundreds of human jobs or even start ruling us. In my role, I need to constantly wonder how to use new age advancements in VFS Capital so that our impact increases both in business and social perspectives. I have been fortunate to have advisors who can extrapolate technology innovations to our business process. From them, I come to know that AI has the potential to greatly impact the field of social work by enhancing various aspects of practice, research, and administration. But there is also the risk of losing social connection, which is extremely important for those who are trying to climb the financial pyramid.

A core activity for us will be to listen to keep our eyes and ears open. We need to be constantly updated on local and global issues so that we can chalk out opportunities for improvement. While physical conversations do help in understanding local issues, they have their own shortcomings. One of the typical examples would be the fact that a few customers do not want to talk about the harsh realities of their life, thinking that it might impact their chances of getting microfinance. Then there are biases of the team, which force them to present their interpretations rather than facts.

From what I understand, AI can monitor and analyze online conversations, and social media platforms. This "social listening" capability is of great help for businesses like ours to understand public sentiment, identify potential issues, and promptly address concerns. By proactively managing the issues, we may be able to nurture positive social connections, build trust, and demonstrate our commitment to nurturing micro-enterprises. Even for customer service, AI-powered sentiment analysis may also provide valuable feedback for continuous improvement, ensuring that we stay responsive to their customers' needs.

VFS has a strong focus on social connection and therefore can leverage AI to amplify the social impact, thus motivating others to think about self-employment. AI algorithms should be able to analyze large global datasets to identify social issues, predict patterns, and develop targeted interventions. By matching these with the data we gather locally, we should be able to address societal challenges such as poverty, education inequality, or healthcare access, these being our key focus areas. AI-driven initiatives may empower us to make informed decisions, contribute to social well-being, and build stronger relationships with communities, customers, and stakeholders.

But does that mean all is well in using AI for our business? Well, that calls for another blog.

We celebrated Rabindranath Tagore’s birth anniversary a couple of days back. Tagore has always been considered a polymath, poet, musician, and artist who contributed immensely to India's literary and cultural landscape. But there is another angle that people often forget to mention in their speeches. Tagore's contributions to women's empowerment were wide-ranging and multi-faceted. He believed in the inherent dignity and worth of women and advocated for their rights and freedoms. His literary works, educational institutions, and social activism continue to inspire and empower women in India and around the world.

Growing up in a typical Brahmo family, Tagore might have been around more women who were exposed to education than was normal in those days. He believed that education was the key to women's liberation enabling them to become independent and self-sufficient. He also believed that this cannot happen through isolated endeavors and infrastructure. He strongly advocated for co-education and believed that true knowledge can be gained if men and women are educated together. He founded the Visva Bharati University in 1921, one of the first institutions in India to offer co-education.

In the matter of women’s economic empowerment, Tagore was a strong advocate of the view that every woman should have the right to work and earn a living wage. In "Chandalika" we find the struggles of Pakriti, a young woman born into a low-caste family who regularly faces discrimination and oppression. The play is a powerful commentary of a female outcast who questions gender stereotypes and tried to find her place in society. The effect of his works can be seen even today in the increasing number of women who are breaking barriers and making their mark in various fields.

Tagore's advocacy for women's rights was not limited to his writings. He actively promoted women's participation in social and political movements. He encouraged women to organize themselves and fight for their rights.

Rabindranath Tagore's contributions to women's empowerment were wide-ranging and multi-faceted. He believed in the inherent dignity and worth of women and advocated for their rights and freedoms. His literary works, educational institutions, and social activism continue to inspire and empower women in India and around the world. It was very aptly explained by a former chairman of the National Commission for Women, Dr Girija Vyas, on the 150th birth anniversary of Rabindranath Tagore. In her words, “From Gitanjali to Chokher Bali, Tagore was scathing in his comments against gender suppression. He beautifully celebrated womanhood in many of his works and his words find relevance even today”.

Last week I wrote about the positive effects of the participation of women in S&P 500 companies. Not much changes if we look at a different set of companies, i.e., those who give microloans.

According to a report published by the Reserve Bank of India in 2021, women borrowers account for more than 55% of the total number of microfinance borrowers in India. This goes on to show that at the bottom of the financial pyramid, women have been showcasing more enterprising abilities.

A study conducted by the International Journal of Scientific and Research Publications in 2020 found that microfinance has significantly contributed to the entrepreneurship development of women in India. The study also revealed that women who received microloans were able to improve their businesses, generate more income and create jobs.

Needless to say, these have had associated benefits as well. Women who have started businesses with the help of microfinance have also helped in promoting financial inclusion among women in India. According to a report published by the National Sample Survey Organisation (NSSO) in 2021, the percentage of women who have a bank account has increased from 28.7% in 2014 to 77.7% in 2018.

This increase in the ownership of bank accounts is attributed to financial independence and the wholesome enhancement of empowerment in their families and society. A study published by the International Journal of Community Medicine and Public Health in 2020 found that women who received microfinance loans reported a higher degree of decision-making power in their households. They were able to make important decisions related to their children's education, family health, and family finances. The study also revealed that women who received microfinance loans were more likely to participate in community activities and take on leadership roles.

While I have, at many times, been writing about the fact that the biggest positive effect of empowerment has been in providing education to the next generation, we also need to understand the effect it has had on healthcare. Women entrepreneurs of microenterprises have better access to healthcare services that were previously unaffordable for them. A study published in the Journal of Health Management in 2020 says that women who received microfinance loans were more likely to seek medical care when needed, both for themselves and their families.

However, there is still a need for efforts to address the challenges faced by these enterprising women which restrict them from growing from micro to small enterprises. That is the reason we are bringing in changes in microfinance making it more inclusive and sustainable in the long run.