Women online: A study of common service centers in India using a capability approach

Rajeev, Meenakshi; Bhandarkar, Supriya Working Paper Women online: A study of common service centers in India using a capability approach ADBI Working Paper, No. 1327 Provided in Cooperation with: Asian Development Bank Institute (ADBI), Tokyo Suggested Citation: Rajeev, Meenakshi; Bhandarkar, Supriya (2022) : Women online: A study of common service centers in India using a capability approach, ADBI Working Paper, No. 1327, Asian Development Bank Institute (ADBI), Tokyo This Version is available at: https://hdl.handle.net/10419/267760 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by-nc-nd/3.0/igo/ ADBI Working Paper Series WOMEN ONLINE: A STUDY OF COMMON SERVICE CENTERS IN INDIA USING A CAPABILITY APPROACH Meenakshi Rajeev and Supriya Bhandarkar No. 1327 June 2022 Asian Development Bank Institute The Working Paper series is a continuation of the formerly named Discussion Paper series; the numbering of the papers continued without interruption or change. ADBI’s working papers reflect initial ideas on a topic and are posted online for discussion. Some working papers may develop into other forms of publication. The Asian Development Bank recognizes “China” as the People’s Republic of China. Suggested citation: Rajeev, M. and S. Bhandarkar. 2022. Women Online: A Study of Common Service Centers in India Using a Capability Approach. ADBI Working Paper 1327. Tokyo: Asian Development Bank Institute. Available: https://www.adb.org/publications/women-online-a-study-ofcommon-service-centers-in-india-using-a-capability-approach Please contact the authors for information about this paper. Email: [email protected] Meenakshi Rajeev is a professor and Supriya Bhandarkar is a PhD scholar at the Institute for Social and Economic Change, Bangalore, India. The views expressed in this paper are the views of the author and do not necessarily reflect the views or policies of ADBI, ADB, its Board of Directors, or the governments they represent. ADBI does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequences of their use. Terminology used may not necessarily be consistent with ADB official terms. Working papers are subject to formal revision and correction before they are finalized and considered published. We are immensely grateful to ADBI for its support in carrying out this work. We also thank Gayathri Devi, Sabyasachi Tripathi, Jayasimha K Rao, and Pranav Nagendran for their valuable support, without which this paper would not have been completed. Meenakshi Rajeev thanks the ICSSR and the RBI for their support for ISEC. The usual disclaimer applies. Asian Development Bank Institute Kasumigaseki Building, 8th Floor 3-2-5 Kasumigaseki, Chiyoda-ku Tokyo 100-6008, Japan Tel: +81-3-3593-5500 Fax: +81-3-3593-5571 URL: www.adbi.org E-mail: [email protected] © 2022 Asian Development Bank Institute ADBI Working Paper 1327 Rajeev and Bhandarkar Abstract Income-generating activities performed by women are an effective way to reduce gender deprivations and disparities. In the constrained familial and community settings of developing economies, the online platform can be an appropriate means for women to carry out economic activities. In this context, certain important initiatives taken by the government of India such as the creation of Common Service Centers are worth studying. This paper critically evaluates such revolutionary online platform-based entrepreneurial initiatives using the capability approach developed by Amartya Sen. We examine how women-run businesses use the online platform and what determines their success, inputs, capabilities, and conversion factors through a case study method. Further, enterprise-level National Sample Survey Organization data at the all-India level are analyzed to show that the states that have a higher level of gender inequality are also the regions with a lower level of information and communications technology usage by women-run enterprises. Keywords: common service centers (CSCs), village-level entrepreneurs (VLEs), capabilities, online platform, women-run enterprises JEL Classification: L26 ADBI Working Paper 1327 Rajeev and Bhandarkar Contents 1. MOTIVATION AND THE COUNTRY CONTEXT .......................................................... 1 2. VILLAGE-LEVEL ENTREPRENEURSHIP (VLE): SCHEMES OF RELEVANCE ........ 3 2.1 Common Services Center–Village-Level Entrepreneur (CSC-VLE) Scheme .. 3 2.2 Stree Swabhiman: An Initiative under the VLE Program .................................. 3 3. DATA AND METHODOLOGY ....................................................................................... 3 3.1 Methodological Approach .................................................................................. 3 3.2 Primary Data Collection ..................................................................................... 4 3.3 Survey Instruments ............................................................................................ 4 4. THEORETICAL FRAMEWORK ..................................................................................... 5 5. MACRO-SCENARIO: AN ANALYSIS OF NSSO DATA ............................................... 5 5.1 Determinants of Internet Usage by Women-Owned Enterprises ...................... 6 6. SUMMARY STATISTICS FROM FIELD-LEVEL DATA ................................................ 8 6.1 Economic Activities and Impacts ....................................................................... 8 6.2 Social Impacts .................................................................................................. 10 7. ENTREPRENEURSHIP AND TECHNOLOGY THROUGH A CAPABILITY LENS: SELECTED CASE STUDIES ...................................................................................... 10 7.1 Taxonomic Partition ......................................................................................... 11 8. CONCLUDING REMARKS AND POLICY SUGGESTIONS ....................................... 15 REFERENCES ........................................................................................................................ 17 ADBI Working Paper 1327 Rajeev and Bhandarkar 1 1. MOTIVATION AND THE COUNTRY CONTEXT Income-generating activities performed by women are an effective way to reduce gender deprivation and disparities (ADB 2013). Encouraging women’s entrepreneurship has several benefits for an economy, such as improving livelihood opportunities and closing the gender gap in the labor market, thereby alleviating poverty and enabling sustainable economic development (ESCAP 2015). Women entrepreneurs, however, are still a minority in developing countries and face several work-family constraints (ADB 2018; Panda 2018). In India, women entrepreneurs are usually engaged in small businesses, and many of these activities are coordinated through self-help groups (SHGs), where certain product development training programs are usually organized by the government. However, these programs frequently overlook the important aspect of product marketing, which remains a major concern for enterprises (Rajeev et al. 2015). Further, due to patriarchy and other gender-based taboos, women’s movement in countries like India, particularly in rural areas, is often restricted, confining them to their homes (see Gaitan 2018). Extra responsibilities like caring for children and the elderly (Duflo 2012; Yu and Cui 2019) create a further hurdle for them to overcome in taking up income-generating activities. In such a constrained familial and community setting, the online platform has proved to be advantageous as it enables production and marketing to be done from home. Furthermore, Covid-19 has heightened the importance of this avenue as it offers opportunities for contactless business. In addition, the online platform provides marketing opportunities at a lower cost to entrepreneurs wishing to scale up their businesses. This is important for women entrepreneurs, who are often unable to acquire large capital for investment. As has been well accepted, finance is one of the crucial requirements for starting and expanding a business, which small entrepreneurs lack. The usage of ICT-based tools helps these entrepreneurs to gain information on different modes of financing to improve their access. It can also help them acquire information on business development techniques and marketing opportunities (Webster and Zhang 2020; Güney-Frahm 2018), which can improve their return and thereby reduce poverty (ADB 2018; Liu, Zhou, and Wu 2015). More importantly, even microand small-enterprisebased women from interior rural and tribal parts can successfully establish business contacts without the interference of, or exploitation by, middlemen or fixers. However, women wishing to operate on the online platform face several challenges as well, the most prominent being a lack of infrastructure access and operational knowledge. Because of this, they are not able to use ICT efficiently to their advantage (Martinez and Nguyen 2014; UNCTAD 2014). India, in particular, has a significant digital gender gap in Internet usage, with men accounting for 71% of Internet users and women accounting for only 29%. Compared to urban India, this gap is significantly higher in rural India, where the male-to-female internet user ratio is 88:12 (IMAI 2019). Furthermore, the (general) Gender Gap Index developed by the World Economic Forum (2020) ranks India as low as 112th among 153 countries based on indicators such as economic participation and opportunity. Literature also highlights how women in India are discouraged from using mobile phones and the internet, which essentially results in digital exclusion (Mukherjee et al. 2016). Thus, it is felt that empowering women through e-business requires governmental interventions. Researchers, however, argue that most state interventions for e-business development are genderblind and, as a result, they benefit male entrepreneurs while excluding women unintentionally (Orser, Riding, and Li 2019). Therefore, it is required that gender- ADBI Working Paper 1327 Rajeev and Bhandarkar 2 sensitive incentives be provided to women entrepreneurs (Orser, Elliott, and Findlay‐ Thompson 2012) for them to get the benefits of the state programs. One such transformative initiative undertaken by the government of India is the establishment of Common Service Centers (CSCs). CSCs are launched to serve as local access points for electronic services for various state welfare schemes, including financial inclusion programs. At the village level, entrepreneurs (VLEs) can establish these centers for the online enrollment of local citizens for various government welfare programs, charging a fee. This business, by its nature, is online as it requires accessing a government-created portal and uploading biometrics, etc. of the service seekers. These activities have now spread to every corner of the country, assisting in the expansion of digital literacy, livelihood opportunities, and smooth transfer of state benefits to citizens. Another revolutionary VLE program initiated by the state is the Stree Swabhiman (self-respect of women) scheme where women entrepreneurs manufacture and sell sanitary pads under local brand names while also educating women about menstrual hygiene. This is a program that does not necessarily require online operations. But there is immense potential to use the online platform for this business for marketing as well as information dissemination. Whether rural women are able to take advantage of ICT for these two significant VLE programs is an important question to consider. This paper looks at the functioning of these programs in the rural regions, examining how the otherwise deprived rural women use the digital platform for livelihood generation through the VLE schemes, as well as their achievements and challenges. Despite the CSC VLE scheme being a revolutionary development under the digital India program, there have not been many rigorous studies on the subject. The few studies that do exist focus essentially on the terms of the scheme and the challenges of CSC rollouts (Dass and Bhattacherjee 2011; Dwivedi et al. 2016; Sharma et al. 2021) as well as the service qualities (Uthaman and Vasanthagopal 2017). Further, a study conducted at the Indian Business School attempts to highlight the factors that drive the entrepreneurial performance of VLEs and assess the financial viability and social impact of CSCs (Indian School of Business 2018). As CSCs also deal with banking services, the impact of these centers on financial inclusion has also been examined in the literature (National Insurance Academy 2021). To the best of our knowledge, there is no systematic study that looks at such transformational government initiatives in the context of digital literacy and entrepreneurship development in rural areas based on ground-level experiences. More importantly, the role of the scheme in transforming the capabilities of women VLEs and the conversion factors at work have not been analysed in the existing literature. The current study, therefore, fills this significant research gap by bringing in the gender dimension while taking up Sen’s capability approach (Sen 1979, 1985) as a framework for analysis. The study reveals several interesting aspects by employing both qualitative and quantitative methods. An important contribution of the paper is to analyze National Sample Survey Office (NSSO) enterprise-level data at the all-India level to demonstrate, using cross-sectional regression, that states with higher levels of gender inequality are also regions with lower levels of ICT usage by women-owned enterprises. A case study method is used to discuss how women engaged in the CSC-VLE and Stree Swabhiman programs use online services in business and what factors influence their success and failure. These cases were gathered during our field visits, and Sen’s capability theory (Sen 1979, 1985, 1993) served as our conceptual framework for analyzing these cases in terms of capabilities and conversion factors, which is novel in this context. ADBI Working Paper 1327 Rajeev and Bhandarkar 3 2. VILLAGE-LEVEL ENTREPRENEURSHIP (VLE): SCHEMES OF RELEVANCE When we consider women’s entrepreneurship and usage of the online platform at the village level, as mentioned above, two state schemes appear to be of immense importance. A few of their details are discussed below. 2.1 Common Services Center–Village-Level Entrepreneur (CSC-VLE) Scheme One of the noteworthy initiatives by the Ministry of Electronics and Information Technology, Government of India is the Common Service Center (CSC) scheme that was conceptualized to successfully implement e-governance in the country. These service centers were initially established to act as access points at the local level for electronic services for various state welfare schemes, including those for financial inclusion. For better monitoring and accountability as well as for reducing corruption, beneficiaries of state welfare programs need to enroll through government portals. Common citizens are usually unable to do these activities. CSCs act as a mediator by charging a small fee towards getting the work done with ease and efficiency. There are 360,873 functional CSCs across India as of 2020 (https://www.csc.gov.in). Thus, this is a large-scale livelihood program creating village-level entrepreneurs. A potential entrepreneur wanting to become a CSC-VLE needs to enroll through a government portal. A certificate is also required for opening a digital Seva Kendra, i.e., a CSC outlet, which can be obtained by passing an online test, with the test varying depending on the kind of services the VLE decides to provide. Once the candidate enrolls after passing a qualifying test and is registered, s/he will be provided with an ID, which can be used to log on to the CSC portal and provide services. There is no rationing based on the number of VLEs in a location. Some of these services are also provided by public agencies, but the advantages of dealing through the CSCs include their easy access, less travel, better communication, and so on. However, as the number of CSCs is large, there is competition and the entrepreneurs need to maintain good services to capture a better share of the market. 2.2 Stree Swabhiman: An Initiative under the VLE Program Another important drive under the VLE scheme is the Stree Swabhiman (self-respect of women) initiative under which women entrepreneurs make sanitary napkins and compete with multinationals selling similar products. In some cases, they receive state support in terms of marketing their products. Further, they provide an important service by educating village women and girls about menstrual hygiene and thus the importance of using sanitary napkins. Products are sold by local VLEs under local brand names (www.stree Swabhiman/Project Overview). 3. DATA AND METHODOLOGY 3.1 Methodological Approach A multiple-method strategy, using both qualitative and quantitative methodologies, is adopted in this paper. To provide a background for the study, at a macroeconomic level we analyze secondary data provided by the NSSO at the enterprise level (NSSO ADBI Working Paper 1327 Rajeev and Bhandarkar 4 2016). The survey consisted of a sample of 2,90,113 enterprises, 51% of which were located in rural areas from which data have been extracted for women-headed proprietary enterprises that use Internet facilities in their business. Though NSSO data offer information on women-run enterprises, no data are provided on CSCs, and to fill this gap, we conducted a field survey. The field-level findings are presented through a case study method where important cases from our primary survey are elaborated upon. The case study method offers a means of investigating complex social units such as women entrepreneurs, who are influenced by multiple variables of potential importance. Within the case study approach, multiple cases are considered to understand the differences and the similarities in the perspectives of various participants and analyze contrasting impacts of the same program on different participants, which in turn helps decipher the role of external factors in the outcomes (Yin 2003). 3.2 Primary Data Collection Two states, one developed 1 and the other relatively less developed, viz., Karnataka and Assam, are considered for our study. We selected five districts purposively from each state comprising both developed and less developed districts, namely Kamrup, Golaghat, Nagaon, Darrang, and Bongaigaon from Assam and Tumkur, Dharwad, Bellary, Belgaum, and Uttara Kannada from Karnataka. In collating the list of women-run CSCs in these two states, we collected data for 120 CSCs, 75 from Karnataka and 45 from Assam, belonging to the above-mentioned districts. According to our pilot survey, the CSC scheme in Assam is in the nascent stage, with limited activities compared to Karnataka, where the program has made significant progress. As information was limited in Assam, we chose a larger sample from Karnataka. The sample size is constrained due to difficulty in conducting a large-scale survey because of the devastating effects of the pandemic and the resulting lockdown. For comparison purposes, we selected 50 women entrepreneurs, 15 from Assam and 35 from Karnataka, engaged in small offline businesses such as trading, baking, jewelry making, etc. Interviews were conducted both over the phone and in person. The enterprises under the Stree Swabhiman scheme are limited and many of them are now defunct. Hence, we collected information from four such entrepreneurs, two each in Assam and Karnataka, and presented their cases in Section 7. Information about these operative entrepreneurs is obtained from government offices. 3.3 Survey Instruments A structured questionnaire was formulated for the field survey. First, a pilot survey was conducted, based on which some revisions to the questionnaire were made. Questionnaires used for this case study were developed following the review of existing literature, news reports, reading government documents, and based on our research questions. The questionnaire contained both quantitative and qualitative questions on the following areas of interest: motivation to start the business, problems faced, familial and government support, level of income and expenditure, etc. All the participants were provided with information outlining the research aims and were informed that their experiences would be documented and subsequently available in the public domain. Informed verbal consent about recording the interview was obtained prior to 1 Karnataka has an HDI score of 0.706 and Assam has an HDI score of 0.651 (National Statistical Office 2018). ADBI Working Paper 1327 Rajeev and Bhandarkar 11 7.1 Taxonomic Partition Building on our field observations, we put forth a taxonomic partition based on the capabilities and functioning of the women entrepreneurs into three broad groups. The partitioning done in terms of conversion factors and agency considers: (1) “Active entrepreneurs: ICT acting as conversion factor” comprising women undertaking their business with tremendous interest and zeal; the (2) “Passive group: Hindrance of social conversion factors,” who are running the business primarily with the assistance of their relatives as resigned entrepreneurs; and the (3) “Withdrawn entrepreneurs: Lack of conversion factors leading to functioning failure,” which comprise unsuccessful CSC business ventures. (We have presented a schematic representation of these cases in Figure 1.) 7.1.1 Active Entrepreneurs—ICT Acting as a Conversion Factor In addition to achieving financial freedom, starting a CSC or a sanitary pad-making unit under the Stree Swabhiman scheme held immense value for this group of active entrepreneurs. CSC Activities The most important resources that operating a CSC requires are a mobile phone, a laptop, and Internet facilities. Depending on the extent of the business, many use mobile phones (costing INR4,000–12,000) for enrollment, while others utilize a desktop or a laptop (costing INR35,000-60,000). The biometric device costs an additional INR2,500–3,000. Technology is therefore used as an input that is vital to starting a CSC business. However, the mere presence of inputs does not lead to the same capability expansion and functioning for all individuals since individual conversion factors such as gender, literacy, skill, and agency play an important role. Take, for example, the case of Ms. Nibha from Dharwad district of Karnataka, who actively spreads the message of CSCs across the state through a WhatsApp group. She is representative of an opportunity entrepreneur 6 , who, despite having the option to take up wage employment, saw the business potential in her village and decided to open a CSC. According to Ms. Nibha, the government has around 1,000 schemes, and because all the schemes require online enrollment, the business potential is enormous. As a result of the volume of transactions, even charging a small fee can result in significant earnings. However, she observes that, due to this potential economic gain, competition has intensified. Ms. Nibha started her business in 2017 on the premises of her husband’s photocopying shop. Encouraged by her husband to undertake computer training rather than a traditional job such as tailoring, she was driven to take up CSC work. Self-learning the presence and handling of the various CSC schemes through YouTube videos increased her earnings from INR7,000 in 2017 to INR30,000 in 2019. Even during the pandemic, she was selected for Covid-data entry work and earned INR24,000. The recovery of her business in 2021 is expected to earn her INR30,000 per month. However, apart from this monetary gain, she has accrued the distinct social benefits of gaining significant respect within her community since all the people in her village approach her for various welfare schemes. She also proudly announces that she has 6 The Global Entrepreneurship Monitor differentiates between opportunity and necessity entrepreneurs. Opportunity entrepreneurs are those individuals who are motivated by the prospect of success and are pulled into self-employment, while necessity entrepreneurs are pushed into self-employment because there are few or no other alternatives to earn a living. ADBI Working Paper 1327 Rajeev and Bhandarkar 12 full rights over her earnings. Today, in addition to managing her own business, she trains other women in CSC work, empowering them to start their businesses. Thus, from an entrepreneur, she has also become an entrepreneur trainer. Ms. Nibha is not a singular case; there are other women working actively in this field. Thus, while ICT is the basic input for CSC work, it also plays a transformative role by enhancing the role of other inputs such as knowledge and skill. These women are constantly interacting and learning from one another using ICT-based platforms such as WhatsApp and YouTube. Technology has created an enabling and transforming environment where knowledge is continuously enhanced. Thus, ICT has become a conversion factor, rather than only input for enrollment in various schemes. As previously mentioned, a recent paper by Haenssgen and Ariana (2018) is a significant contribution in this regard. They wrote, “[T]echnical objects do not only have a ‘generative dimension’ that makes them an input like other objects in the CA. Technical objects also have a ‘transformative dimension’ through which other inputs are affected in the attainment of valued capabilities. In this transformative capacity, technical objects behave like other conversion factors.” In our case, for these active CSC members, we argue that ICT played a dual role: first, as an input in terms of a device that helps the enrollment process; and second, as a conversion factor, since online platforms like WhatsApp, Facebook, and Instagram help with the continuous skill formation required to carry out business. In Assam, where the CSC activities have just begun, Ms. Rita from Jagiroad in Naogaon district began her activities as the head (pratinidhi) of a self-help group (SHG). She then became a banking correspondent (Bank Mitra), helping people carry out banking activities on their doorstep using the e-platform. She has recently got permission to carry out CSC activities and her business has just begun. But she uses her already existing network of SHGs in different villages through the WhatsApp platform to carry out her banking work in several villages and inform them about the CSC scheme (using ICT as a conversion factor). She enjoys not only the income, but also the respect she gets from the villagers as well as banks. Such social benefits have empowered her to fight for her rights. Her in-laws were initially unhappy about her working outside the house, but her confidence and success have helped her to establish herself and overcome these barriers. Thus, all these women enjoy their instrumental agency success, with the entrepreneur herself playing an active part in achieving her objective. They acquired the ability to set goals and realize them. However, there are some distinctions between the successful cases of Assam and Karnataka. As the country’s information technology capital, Karnataka citizens are far more Internet-savvy. This knowledge has spillover effects, and as a result, we see that a good percentage of women in Karnataka have relatively better digital literacy and learning-by-doing experiences. Furthermore, the level of difficulty of the enrollment process of CSC-based schemes varies depending on the schemes. The successful women of Karnataka are engaged in enrolling in schemes that have considerably more difficult procedures, whilst those in Assam are limited to schemes with simple procedures. Stree Swabhiman Entrepreneurs: Technology Acting as a Conversion Factor Unlike the CSC-based business model where only local, small entrepreneurs operate, under the Stree Swabhiman scheme, small, unknown, untrained entrepreneurs compete with established corporates, particularly MNCs making the same product. So the struggle to find a niche for themselves is more intense. ADBI Working Paper 1327 Rajeev and Bhandarkar 13 This is a segment close to a woman’s heart as she experiences the menstruation phase. Thousands of such women, especially in the poorer segment and in rural areas of developing nations, use unhygienic methods to protect themselves during this phase and subsequently face health hazards. Therefore, initially, when the government declared that it would provide free sanitary napkins to young girls in schools, it was considered a welcome move. Several women came forward to make use of this opportunity and indigenously produce such products to be subsequently procured by the government. These women can therefore be considered opportunity entrepreneurs. They also served a very important purpose of spreading the message of menstrual hygiene amongst the girls in villages. There are certain examples of success stories of active entrepreneurs in this program. In the Koppal district of Karnataka state, Ms. Revathi emerged as an entrepreneur who produced sanitary napkins for her village using an ingenious and effective method, and today she is popularly known as the “pad woman of Karnataka.” She tracks all young women through a record book to ensure that menstrual hygiene becomes a part of their daily life, due to which the percentage of women using her pads has increased from 7 to 60. Personal and social factors such as a lack of personal funds for investment and subsequent refusal by public banks to finance the new business led Ms. Revathi to pledge her gold for an informal loan at an exorbitant 24% interest rate to purchase a handheld machine and start her business. She went to villages to educate the young women and so far has conducted more than 2,000 sessions single-handedly. To differentiate her business from other similar ventures, she learned a technology that helps produce a completely biodegradable pad without the use of chemicals like chlorine. Using natural products like banana fiber for its manufacturing and sourcing the required raw materials online, the pad woman of Karnataka has created a niche for herself in this sector. A slew of factors contributed to the success of these unique biodegradable pads. Inefficient garbage collection in rural areas has led to these pads becoming a preferred option. Additionally, rural women who are involved in manual construction work and sweat more found her pads more comfortable and body-friendly. The success of these pads got publicized on social media platforms and she attracted the attention of both print and electronic media. Subsequently, she was able to obtain a loan under the government credit scheme (a social and environmental conversion factor), enabling a move to a semi-automatic machine in 2019 and a fully automatic machine costing INR2 million in 2020, all through repaying her past loans. Ms. Revathi has grown increasingly active on Facebook and Instagram in seeking crowdfunding and corporate funding. A young girl can be supported for a year for as little as INR500, and Ms. Revathi is seeking to provide this to slum girls. A girl who receives this support then becomes a leader in the community, spreading the message of hygiene to other girls using WhatsApp or offline meetings. She has now formed a large nan umber of SHGs and sells her product to them via WhatsApp. There are a few other women who can also be categorized as active entrepreneurs in this segment. But a more significant development was yet to come for Ms. Revathi. From her online presence, she attracted the attention of a gynecologist from Hyderabad who now markets her products, highlighting the fact that she uses fully natural products. While computer technology has aided these active entrepreneurs as a generative input in terms of helping them surf the web to source raw materials, etc., the online platform has also played a transformative role in these cases. As discussed above, the technology has played the role of a conversion factor (Haenssgen and Ariana 2018) ADBI Working Paper 1327 Rajeev and Bhandarkar 14 by having an impact on other inputs such as funding agencies and donors in addition to other institutions that have helped with the distribution of the product. Further, looking from the perspective of an “agent-oriented view” as described by Sen (1985), these active entrepreneurs took it upon themselves to help the community and “effectively shape their own destiny and help each other” (Sen 1999). 7.1.2 Passive Group: Hindrance of Conversion Factors The second type of women VLEs are those who have a CSC in their name but the business is managed primarily by a man, often her husband or son. The case of Smt. Ratnamma Kadlimath is an atypical one in this category. Ratnamma, 55, from Bagalkot district in Karnataka, is a middle school dropout and has been involved in CSC work for the last six to seven years. This interview was partly given by her son Janamantha. Despite the CSC being started in her name to take advantage of the government assistance being given to women, she is not involved or trained in this work. A similar situation can be observed in Assam, where Ms. Saisbali has opened a CSC in her name but the work is managed by her relative Mr. Sujay, who has passed the necessary examination for doing CSC work. In terms of the capability approach, these cases face constraints owing to individual conversion factors such as gender and skill as they lack the required knowledge for operating online and are not encouraged to participate in the training programs by their families. Entrepreneurs in Assam are hindered by conversion factors such as unstable internet connectivity and power supply. Karnataka entrepreneurs face issues such as the server failing to function properly due to overload. Most of these entrepreneurs face another problem too, which can be referred to as an environmental conversion factor. Due to certain instances of anomalies in the Aadhaar card-making process (which is the primary identity card in India), as a precautionary measure, this facility has been withdrawn from many entrepreneurs, leading to the closure of some businesses. As far as “agency” is concerned, failure of the instrumental agency is observed as these passive entrepreneurs are not playing an active role in the achievement of their business success. Realized agency success is also limited as their relative has not empowered them either. 7.1.3 Withdrawn Entrepreneurs: Constraints Posed by Individual and Environmental Conversion Factors Besides the success stories that we have delineated, there are several failed cases, both in CSC and in Stree Swabhiman businesses. Punusuya Bai (aged 37) from Karnataka is a case where the inability to get an identity (ID), which is required to operate, has created problems in undertaking CSC work. There are several cases in this category. Widowed 15 years previously, Punusuya returned to her natal home and started her business with the support of her father. Initially, they invested around INR100,000 for two laptops, and around INR2,200 for renting premises along with the recurrent monthly cost of the Internet. The kiosk, however, was defunct after a year because she realized that she lacked the skills to deal with such enrollment procedures. More importantly, their ID and password became inoperable as a result of the government’s revamping of operations, and their attempts to obtain a new ID were futile. Their computers had also become outdated and slow, making it difficult to compete with new entrepreneurs. Several such cases with ID and skilling issues and an inability to compete were observed during our survey. Our findings point to a lack of training and computer literacy as critical ADBI Working Paper 1327 Rajeev and Bhandarkar 15 conversion factors that hampered women’s business success. Continuous learning is required in this industry because each new scheme has its own enrollment procedure. Under the Stree Swabhiman program, initially, a large number of entrepreneurs came forward in the hope that there would be government procurement for schools. Subsequent nonprocurement and intense competition from MNCs forced these microentrepreneurs to shut down operations (observed both realized and instrumental agency failure). Here too we observe the environmental conversion factor posing constraints in realizing functioning. Figure 1: Schematic Representation of CSC Entrepreneurship through the Capability Lens Source: Author’s Representation. 8. CONCLUDING REMARKS AND POLICY SUGGESTIONS ICT has brought widespread changes to how our economy works. It has transformed how people access services and utilities and how they conduct business. Most importantly, technology has made information cheaper and available to all. Despite these promising changes in the economy, a large majority of people in India remain untouched by digital transformation. To remedy this, the government has strengthened the CSC scheme as part of the Digital India Program. The government particularly encourages women to take up the role of a CSC-VLE to improve their social and economic status. ADBI Working Paper 1327 Rajeev and Bhandarkar 16 Even though this is a transformational development, only a few studies have looked into the challenges and benefits that rural women entrepreneurs face while undertaking such online businesses. This paper adopts a case study approach to study such entrepreneurs in two Indian states: Assam and Karnataka. The cases are analyzed using the capability framework developed by Sen (1979, 1983, 1995). We see that in certain cases, ICT has played a transformational role and has acted as a conversion factor; however, in some other cases, ICT has acted only as an input. With the development of the CSCs, another set of unique activities took place under the Stree Swabhiman program where women entrepreneurs manufactured sanitary pads in their villages and made young girls aware of intimate hygiene. Through our cases, we show how these entrepreneurs face a tough battle in the face of multinationals operating in this field and how, through village SHGs and online platforms such as WhatsApp, they are serving the rural society. Based on our study, a few major policy suggestions can be put forth for improving women’s participation in online business in general and CSC activities in particular. One of the major bottlenecks many face, especially in Assam, is that their functioning is dependent on conversion factors such as uninterrupted Internet and electricity supply. CSC entrepreneurship needs investments in online devices, printers, and biometric machines, for which women entrepreneurs require adequate provisioning and access to credit facilities through a formal banking system. Training and awareness building for various online business opportunities are also necessary as different schemes have different enrollment procedures. Though the Covid-19 pandemic and the resulting lockdown impacted businesses negatively, the situation has improved over time. The pandemic also created certain new opportunities as more and more consumers are now opting to shop and transact online. Further, the government has also introduced new schemes to aid citizens during the pandemic, for which enrollment needs to be done through CSCs. Thus, in the long run, skilling appears to be a more daunting challenge. While more educated and computer-trained women from Karnataka can pick up these procedures through WhatsApp and YouTube videos, not all women are equally tech-savvy and they need more hands-on training. It is our observation that concerned government officials often try to highlight the successful cases and neglect the ones that struggled and failed. It is time they concentrate on the failed cases. Thus, women with lower levels of education and in remote areas need special attention. Women belonging to socially backward classes (such as scheduled castes and tribes) are not well educated and the state should focus on such classes in terms of their involvement in online business. Successful and active entrepreneurs also face problems with server capacity, which makes the process of enrollment highly time-consuming. As a result, only a few enrollments are undertaken per day, leading to lower income. 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