Bypassing funds crunch: Top Ahmedabad NGO to go all-India with its new business model for social cause

Gagan Sethi, Madhava Menon, Rajendra Joshi

In an apparent move to bypass foreign funding dilemma, a top Ahmedabad-based NGO, Centre for Social Justice (CSJ), working in the arena of social justice lawyering, has decided to go all-India with its Nyayika experiment, operating as a non-profit company under Section 25 of the Companies Act, 1956. The Act allows setting up private limited companies to “promote” commerce, art, science, charity or any other “useful” activities on a no-profit-no-loss basis. Currently, Nyayika operates from eight centres in Gujarat -- Ahwa, Modasa, Mandvi, Bharuch, Palanpur, Amreli, Vadodara and Ahmedabad – providing affordable legal services to vulnerable sections.
A high-level seminar at Vishwa Yuvak Kendra, Chanakyapuri, Delhi, sponsored by CSJ, was told, over the next five years, Nyayika envisages setting up new centres in Gujarat but also expanding to Madhya Pradesh, Chhattisgarh, Jharkhand, Uttar Pradesh, Karnataka and Punjab. In all 30 centres will be opened, it was pointed out at the seminar, adding, they will work within the framework of combining the business model of a law firm and the NGO model of empowering vulnerable sections through outreach programmes.
Critical of “voluntary organization-run free legal aid centres” which Nyayika said face issues of “poor accountability towards clients and lack of continued funding, making them unsustainable over a long period of time”, a book showcasing Nayika insisted, “As a result of this, people seeking legal services are left with no option but to face exploitation in the hands of mainstream lawyers who often charge fees arbitrarily and offer mediocre services.”
While the decision to take the Nyayika experiment all-India comes amidst shrinking scope for foreign funding to NGOs in the recent past, first during the UPA regime and now under the NDA, a demonstration at the seminar was made before senior lawyers, social activists and experts suggested how the model of providing legal services at affordable fees from clients to sustain its operations could actually become viable.

The Nyayika book titled “Setting up Social Justice Law Firms: Experiences of Nyayika” released on November 9 at the seminar said the Nyayika experiment in Gujarat was based on a “business model with its own revenue generation and expenditure plans and which is dependent on collection of fees for services provided for its sustainability and growth.” It added, Nyayika provides “quality professional legal services charging affordable fee in order to subsidize those who cannot pay”.
Called “National Meet of Social Justice Lawyers”, the Nyayika seminar saw release of the book by top legal luminary Prof Madhava Menon, currently chancellor, Guru Ghasidas Central University, Chhattisgarh. Participants included Nyayika founders Rajendra Joshi of the SAATH Charitable Trust, Ahmedabad; Gagan Sethi, chairman of Janvikas, Ahmedabad; Nupur Sinha, executive director of Centre for Social Justice, Ahmedabad; and Satyajeet Majumdar, CEO, Nyayika.
The book, which points towards how Nyayika has functioned ever since it was founded in October 2013, says the organization is based on a revenue sharing model where 70 per cent of the earnings are used to meet recurring expenditure of those who enter into agreement with Nyayika as associates to provide legal services, and 30 per cent are taken by the company to meet its expenses. At the same time, Nyayika promotes a franchise model, under which overall operations are planned, coordinated and monitored by a central team, and the local operators are responsibility of the franchisee. The company invests in fixed costs while the recurring costs are borne by the franchisee.
The total number of cases handled so far by Nyayika is 1,217, the book informs, adding, Nyayika centres “provided legal advice, assisted entitlement holders to apply for benefits under government schemes, and carried out conciliation and filed court cases on behalf of the clients, all of which is included in this figure. The cases handled mostly comprised of cases of violence against women (193 cases), cases of workmen’s rights (59 cases) and land rights (301 cases).” It also took up “consumer disputes, cases of fraud, dishonor of cheques and property disputes.”