Responsible Digitization of Small Entrepreneurs in Rural India

Lessons from digitizing the Hindustan Unilever Shakti channel

In India, one of the COVID-19 pandemic’s most visible impacts has been the dramatic acceleration towards digital solutions, and digital payments in particular. This report presents key insights and opportunities from Hindustan Unilever Limited’s (HUL) business-to-business (B2B) Shakti digitization program to implement the UN Principles for Responsible Digital Payments and build scale.

In India, the retail business sector accounted for over 10 percent of the country’s GDP and 8 percent of employment in 2017. Over 12 million kirana stores were operational across the country in 2019. This makes the Indian retail market the third largest in Asia and fourth largest in the world, which is set to cross US$1.75 trillion (approximately INR 126 lakh crore) by 2026.

In 2001, HUL launched Project Shakti to financially empower and provide livelihood opportunities to women in rural India. Today, they have a network of 160,000 women entrepreneurs and similar programs in other countries. Since 2019, HUL and the Better Than Cash Alliance have worked on digitizing its retail channels, both, in urban and rural areas. In rural areas, Shakti entrepreneurs have played a key role in this journey. They have used the Shikhar app to order digitally, and their customers can now also pay for orders digitally.

The insights gained from this initiative, and summarized in this report, can be of particular interest to other fast-moving consumer goods companies, distributors, and all other players in the supply chain, in both India and other countries globally.