Jazirah Namukose, 18, left school feeling the sting of rejection. Classmates discriminated against her because of her disability- a clubfoot. But her life changed when she started going to the Kikaaya girls’ club in northern Kampala, Uganda. She gained skills and the confidence to start her own business- and found friends who didn’t treat her differently because of her disability.
2015 was an important year for the world of financial inclusion. Starting with the publication of the six randomised controlled trials results in January that sparked debate on the impacts of microcredit, the sector went on to celebrate (and question) an increase of 700 million people with access to financial services since 2011, with the publication of the 2014 Global Findex.
“I can’t thank BRAC enough for standing beside me when I needed help the most,” Rahela, 24, a microfinance borrower and recipient of BRAC’s credit shield insurance, tells us. She borrowed USD 385 in January 2015 to invest in a small clothing business. Recalling her experience, she reveals, “My husband was not interested initially in having a joint insurance policy, but when the customer service assistant explained it in detail, we decided that we should pay the small premium.”
Imagine a world where there is no access to financial services. You cannot save, which means you cannot set aside money for the future. You cannot access a loan, which means you are shut off from a limitless number of opportunities, including investing in an enterprise, purchasing a home or land, or maintaining household expenses when cash is tight. You don’t have insurance or any kind of buffer against shocks, such as medical emergencies in the family, a sudden loss of a job, or natural disasters. Would you be able to manage?
Stuart Rutherford is an expert in financial services for the poor, and the author of ‘The Poor and Their Money’. He founded SafeSave in 1996, to provide basic banking services in the slums of Bangladesh’s capital, Dhaka. Nearly two decades on SafeSave serves 19,000 clients, helping them afford everyday expenses and budget for bigger life events.
By the time we reached Rangoon Tea House – a fabled place mentioned in many travel literature- it was raining hard. The country representative of BRAC in Myanmar was taking me out to a legendary destination. We met his friends at a table with a fan whirring above with the blades shaped like palm leaves. Ancient black and white movies were projected on the wall with no sound; the silent movies contrasted with the bantering voices in the large room as people chatted and laughed.
Bangladesh is a fast-growing mobile money market. With bKash, the second-largest mobile money provider in the world, industry growth in the country has reached impressive heights. Between January 2013 and February of this year, the number of mobile money clients in Bangladesh increased five-fold to 25 million users, with the number of daily transactions increasing from 10 million to 77 million.
Originally posted on the Center for Financial Inclusion Blog. “I am not sure if I can repay more loans, and I don’t want to be overburdened by debt.” That was how Noyon, a small grocery shop owner with a physical disability, replied when BRAC asked whether he would like to take a loan to expand his business. This is a common response we hear from clients with disabilities when they’re offered credit products. Many prefer to avoid taking loans unless absolutely necessary.
Jannat is not your typical microfinance client. Like an increasing number of BRAC’s microfinance clients, she is not a member of a women-only savings and borrowing group, and did not take a loan to set up a micro-enterprise. Instead, her and her husband are part of new sphere of microfinance clients that is starting to catch on - migrant workers.
This blog was originally posted on 59 minutes of development and Next Billion. Since January, when six randomised control trials were published 'definitively' stating that microcredit is not a viable poverty alleviation tool, microfinance has been taking a lot of heat in the media. One recent article went so far as to compare it to "a zombie that refuses to die." What's kind of funny is that the researchers themselves weren't quite so negative, not that anyone will take the time to read a massive research document. Here's a line I liked.
This month, the results from six randomised control trials (RCTs), published in Science magazine highlighted a model of development that is an adaptable and exportable solution able to raise households from the worst forms of destitution and put them onto a pathway of self-reliance. The graduation approach – financial services integrated within a broader set of wrap-around services – is gaining steady recognition for its astonishing ability to transform the lives of the poorest.