The Microcredit Summit Campaign
MCS in the Media

Launch event for Vulnerability: The State of the Microcredit Summit Campaign Report, 2013

January 25, 2013

SOCR CoverJoin the Microcredit Summit Campaign launch event of Vulnerability: The State of the Microcredit Summit Campaign Report, 2013 on Tuesday, February 5th from 3 to 5 PM at Busboys and Poets (14th & V St, NW) in Washington, D.C. Please RSVP online. Questions? Contact Sabina Rogers (rogers[at]microcreditsummit[dot]org).

The panel will discuss the latest figures presented in the 2013 Report on outreach to poor and poorest clients around the world, which we will reveal are lower this year than in 2011. They will address why the numbers are lower, what clients need, and how organizations are meeting those needs (or not).

Confirmed panelists:

  1. Susy Cheston, moderator (Senior Advisor, the Center for Financial Inclusion at ACCION)
  2. Wendy Abt (Deputy Assistant Adminstrator, USAID)
  3. Alexia Latortue (Deputy CEO, CGAP)
  4. David Roodman (Senior Fellow, Center for Global Development)
  5. Larry Reed (Director, Microcredit Summit Campaign)

The State of the Microcredit Summit Campaign Report highlights the latest data on the progress towards reaching more than 175 million of the poorest families with microfinance and ensuring that 100 million of those families rise out of poverty. This report is the largest and most comprehensive annual survey on the outreach of microfinance to the poor and very poor.

Pathways out of Poverty for the Poorest: The 100 Million Project

November 12, 2012

Can microfinance and enterprise development be part of the journey out of poverty for 100 million families?

The Microcredit Summit Campaign has developed the 100 Million Project to galvanize energy around a global goal of reaching those living in severe poverty and equipping them with useful financial tools and services for their journey out of poverty.

The Campaign debuted its newest 100 Million Project partnership with the SEEP Network during the 2012 SEEP Annual Conference. The event featured the latest developments on this new collaboration. Read our blog post to learn more about this project.

For more on the 100 Million Project, click here, and stay tuned as the project develops.

The 100 Million Project at the SEEP Network Annual Conference

October 17, 2012

At the 2006 Microcredit Summit the global microfinance community adopted two new goals for the industry: reaching 175 million of the world's poorest with microfinance and helping 100 million families lift themselves out of extreme poverty. Of these goals, the second has proved the most challenging. The Campaign has launched a new focus on this second goal with the 100 Million Project a central initiative of that effort.

Now, with advances in poverty measurement tools, technology, and targeted programming for the extreme poor, the 100 Million Project Partners are committed to making and tracking progress against this ambitious goal.

The 2012 SEEP Network Annual Conference will feature some of the work that has been done to date to develop a new collaboration between SEEP and the Microcredit Summit Campaign on the 100 Million Project. Opportunities to learn more about this project at the Conference include the following:

  • Thursday, November 8 at 11 AM: Attend the workshop session "More than Just Measuring Poverty - Using Data to Strengthen Products and Delivery Channels." 
    Panelists: Jacobo Menajovsky (Senior Data Analyst, Financial Services, Grameen Foundation) and Mary Liz Kehler (Director, US Office, Fundación Paraguaya)
    Moderator: Jesse Marsden (Manager, Research & Operations, Microcredit Summit Campaign)
  • Thursday, November 8 at 4 PM: Attend the plenary session "New Strategies in Building Assets for the Ultra Poor
    Panelists: Leonardo Alvarez (Plan International), Carlos Alberto Moya Franco (Banca de las Oportunidades), and Camilla Nestor (Grameen Foundation)
    Moderator: Frank DeGiovanni (Ford Foundation)
  • Wednesday, November 7, 2012 at 5:30 PM: Talk with Campaign staff about the 100 Million Project and how to lend your support to this ambitious effort at the Career Fair.

We look forward to seeing you at the 2012 SEEP Network Annual Conference

Symposium on the Integration of Health, Market Development, and Financial Services for the Poor

October 08, 2012

Tuesday, November 6, 2012
3:00 - 6:00 p.m. ET

Sheraton Pentagon City Hotel
900 Orme Street
Arlington, VA

THIS IS A FREE EVENT

Through its member-driven focus, the Health and Market Development (HAMED) working group at the SEEP Network is committed to linking microenterprise development and microfinance practitioners, public health professionals, policy makers, and donors to address the challenge of health access by introducing strategies for cross-sector partnership and integrated programming for poor and vulnerable populations. To support and strengthen a learning agenda that cuts across financial services, enterprise development, and health improvement for the poor, the HAMED working group will be hosting a symposium on November 6th, 2012 in Arlington, VA associated with the 2012 SEEP Annual Conference.

A growing number of providers of financial services to the poor, social entrepreneurs, and international health practitioners are exploring the potential for linking their respective services and capabilities to address lack of access to health services and financial inclusion. Market-based solutions for health involve investment and capacity building for delivery of health services and products and health financing. They build on strategies, approaches, resources, and platforms from both microenterprise development and financial services. For example, microfinance institutions provide delivery platforms for educating clients, linking them to health services. They can offer financial services to improve access to health for clients or investment in health-related microenterprises. Enterprise development approaches can strengthen access, affordability, and the quality of health-related products and services.

This interactive forum will provide an opportunity for a varied set of practitioners, policy makers, and other stakeholders to share examples of where linkages between financial services, enterprise development, and health services provision are emerging; to discuss questions and challenges; and to identify opportunities for further collaboration to advance cross-sectoral solutions for health and economic strengthening. Key questions to be explored during this event include, 

  • Would the enterprise development, financial services, and health sectors benefit from a common learning agenda? If so, what are the most important questions or areas of learning that shape this agenda? 
  • How can we support this agenda and link in others involved in similar work around the world? 
  • What would this require and entail? 
  • Who should be involved?

We invite you to join us for this unique opportunity!

WHAT?

A three-hour meeting among enterprise development, financial services, and health practitioners designed to facilitate an open and candid discussion about the benefits, challenges, experiences, and lessons learned in the integrated of financial services, health, and enterprise development programs.

WHEN?

Tuesday, November 6, 2012
3:00 - 6:00 p.m. ET

WHERE?

2012 SEEP Annual Conference
Sheraton Pentagon City Hotel (map and directions)
900 Orme Street
Arlington, VA

For more information, please contact Bobbi Gray, facilitator of the HAMED Working Group. Please RSVP by November 2nd.

HOW TO RSVP

If you plan to attend, please register at the conference registration site using this link (there is free registration for this meeting) AND send an RSVP at this link. Please refer to the SEEP Annual conference page for general conference information.  

Stand with the Women of Grameen Bank to Prevent an Unacceptable Violation of Women’s Rights

July 16, 2012

UPDATE (9/6/12)

  1. 3000+ signatures
  2. 100+ countries represented
  3. 20+ organization endorsements


The Microcredit Summit Campaign is sponsoring a petition on Change.org to tell Prime Minister Sheikh Hasina of Bangladesh that the continued actions of her government against the independence of Grameen Bank are not acceptable.

The government led by Prime Minister Sheikh Hasina has now appointed a commission to look into the operations of Grameen Bank and make recommendations as to its future leadership. This commission is widely seen as a way for the government to take control of the Grameen Bank from its women borrower-owners.

What: 

  1. Sign the petitionhttp://mcs2015.org/GBpetition_en
  2. Circulate the petition to all of your supporters
  3. Have your organization endorse our petition:  email Sabina Rogers (rogers[at]microcreditsummit.org) with your name, title, and organization

Why:  This is not just about Grameen. This is about the autonomy of microfinance organizations and civil society institutions in all countries.

We are asking you to sign the petition and share it with your community and contacts to show that the microfinance community will stand up for anyone threatened in this way. These tactics are not unique to Bangladesh, and a government takeover in Bangladesh of one of the largest microfinance institutions in the world (with 8.3 million clients) sets a dangerous precedent.

This action has been led by Larry Reed of the Microcredit Summit Campaign, Vidar Jorgensen of Grameen America, Sam Daley-Harris of the Center for Citizen Empowerment and Transformation, Joanne Carter of RESULTS and RESULTS Educational Fund, and Asad Mahmood.

Learn more about the petition on the Microcredit Summit Campaign blog:  http://mcs2015.org/about-petition

 

 

The Smart Campaign, Social Performance Task Force, and Seal of Excellence Issue a Joint Letter

June 28, 2012

Isabelle Barrès of the Smart Campaign, Laura Foose of the Social Performance Task Force, and Larry Reed of the Seal of Excellence for Poverty Outreach and Transformation in Microfinance issued a joint letter at the SPTF annual meeting in Jordan to explain how these three initiatives "are working together to minimize confusion while increasing options for microfinance practitioners, investors, and other stakeholders."

The letter addresses much of the criticism leveled against the multiplication of standards-setting initiatives these last few years.

  1. Read how each initiative is employing similar strategies to encourage excellence in their different areas of focus and the many steps taken to coordinate action in a common cause
  2. See the logical progression from Client Protection, to Social Performance Management, to Client Level Outcomes. 
  3. Get an early peak at how the 3 initiatives are working to develop a modular approach to ratings


We encourage you to read the entire letter on our website and to visit each initiative's website to learn how you can take advantage of the tools and resources made available. 

Download the letter here.

John (“JD”) Bergeron to Head Seal of Excellence

June 21, 2012

The Microcredit Summit Campaign is thrilled to announce that John ("JD") Bergeron will become the new Director of the Seal of Excellence for Poverty Outreach and Transformation in Microfinance. The Seal of Excellence is a global initiative that will recognize those microfinance institutions doing the most to help families lift themselves out of poverty.

"JD Bergeron is a great choice," said Frances Sinha, Director of EDA Rural Systems and member of the Seal of Excellence Steering Committee. "He will bring freshness and energy to the Seal."

JD Bergeron has worked in microfinance for six years, most recently as Senior Director of Social Performance at Kiva.org. He developed and executed Kiva's social performance strategy, completed 100+ social audits at partner MFIs, and created a scorecard and Social Performance Badges. Previously, he led the growth of the Kiva Fellows Program. Bergeron brings over 16 years of leadership and program development experience both in the corporate and not-for-profit sectors. Prior to Kiva, he worked at Acción, served with the U.S. Peace Corps in a poor, rural region of Bulgaria, and held senior roles at a variety of early stage companies during periods of rapid growth. Bergeron holds a BA in Russian Language and Comparative Literature from Washington University in Saint Louis. He facilitates the Client Voice Task Force at the Smart Campaign and has been an active member of the Social Performance Task Force Working Groups for Social Investors and Universal Standards. He is also the co-founder of Bike Zambia, a not-for-profit event to raise money and awareness of HIV/AIDS and poverty in southern Africa. The inaugural ride leaves Lusaka on June 24th.

"Microfinance has taken some hits over the past few years," said Bergeron, "and I am honored to be working with the Steering Committee to put poor clients at the heart of the microfinance movement. The Seal will help to create a learning environment and to support institutions pursuing positive outcomes for poor clients. I believe the microfinance community is ready for a client-centered approach to poverty reduction and I am inspired by the idea that one day a client will choose an MFI after seeing the Seal in the window because she knows she will be treated well and they will be committed to her long-term success."

"As we were looking for just the right person to fill the Seal Director position," said Larry Reed, Director of the Microcredit Summit Campaign, "it was important that our candidate be strong in four key areas: a familiarity with the social rating and assessment field, an entrepreneurial spirit and experience with start-ups, an ability to communicate the importance of the Seal of Excellence for the industry, and a capacity to raise additional resources. JD Bergeron impressed us in all of those areas."

"We're going against the tide with the Seal," said Seal Steering Committee member and Executive Committee Co-chair Carmen Velasco, co-founder and Director of Pro Mujer, Inc., "and I'm confident that as the Seal Director JD will bring a strategic mindset on how to gain buy-in and be able to articulate the message well."

Learn more about the Seal of Excellence for Poverty Outreach and Transformation in Microfinance:

India Health and Microfinance Community Newsletter

June 08, 2012

header - India Health and Microfinance Community Newsletter The India Health and Microfinance Community Newsletter, Volume 1, Issue 2, June 2012, is now available


What's in this issue:

  • How health-specific financial products help the poor in India deal with medical emergencies. 
  • How Gram Utthan in Odisha is reaching 10,000 clients across 103 villages with village health volunteers.
  • How Freedom from Hunger is bringing health integration to self-help promoting institutions (SHPIs).
  • Invitation to the release event (in New Delhi, India) for "Integrated Health and Microfinance in India: Harnessing the Strengths of Two Sectors to Improve Health and Alleviate Poverty." RSVP now.

This newsletter is a collaborative effort of the Indian Institute of Public Health at Gandhinagar, Freedom from Hunger, and the Microcredit Summit Campaign. Read Issue 1 here.

Larry Reed blogs for the Center for Financial Inclusion

February 15, 2012

Larry Reed, director of the Microcredit Summit Campaign, offers his thoughts on financial education in Tuesday's installment of the Center for Financial Inclusion’s Expert Exchange: Building A Movement Toward Financial Inclusion by 2020, cultivating conversation around the goal of reaching full financial inclusion by 2020. (Blog is reposted with permission; see here for original post.)

Who Needs to be Educated for Us to Achieve Financial Inclusion?

Does the ambition of the Center for Financial Inclusion’s (CFI) Financial Inclusion 2020 initiative include reaching people with little income who live in remote place—places far from urban centers with their financial institutions and communications hubs? That’s what the website says; it states that (emphasis mine):

     "Full financial inclusion is a state in which all people who can use them have 
      access to a full suite of quality financial services, provided at affordable prices, 
      in a convenient manner, and with dignity for the clients. Financial services are 
      delivered by a range of providers, most of them private, and reach everyone 
       who can use them, including disabled, poor, rural, and other excluded 
       populations
."

So what would full financial inclusion look like to a poor disabled woman, living in a rural area, trying to support her four children with what she can grow on a small plot of land? What would she list as her main obstacles to accessing a “full suite of quality financial services?”

Let’s use our imagination a bit to participate in this woman’s experience and try to understand what financial inclusion might feel like for her. Managing money is something she thinks about quite often because she has so little of it and must make it cover so many different expenses. Her husband works in the city and sometimes sends her money. However, the amount she receives is quite a bit less than what he says he sends, and he claims that the people delivering the money can’t be trusted. She grows crops on her small plot of land, but because of her disability her harvest is rarely as fruitful as her neighbors’. Sometimes she is able to scrape enough money together to send her oldest children to school, but in the hungry season—the months before the harvest—she struggles to feed her children, let alone educate them. She tries to save money with her neighbors for the hungry season—and sometimes that works—but when her neighbors are just as desperate as she is, they cannot seem to find the money she stored with them. Last month her son came down with malaria. It took her several days to borrow enough to take him to get help, and the doctor told her she should have come earlier, because her son might now have permanent damage.

If we were able to visit our friend and interview her about the obstacles to financial inclusion that she faces, what do you think she would say? Do you think she would respond that what she needs most is financial education? I doubt it. And yet that is what all of us “experts” said was the biggest need when CFI interviewed us last year.

If we did get a chance to talk with our friend, I think she would tell us that what she needs most to overcome these obstacles is access to appropriate products that are available when she needs them and do not require a long trip to get them. She would probably talk about needing a safe and quick way for her husband to send her money; a safe place to save her money so that it is available when she needs it; a way to finance her children’s education so she doesn’t have to take them out of school in the hungry months; and a way to access money quickly to handle unexpected medical emergencies. If these products were available to her, she might want some help in understanding how to best use them. And if someone she trusted offered to tell her how she could make her money go farther, she would probably be very interested. Financial education as a general topic might have little appeal to her, unless she can see how it will help her deal with the financial struggles she faces each day.

Maybe the first focus of financial education should not be at the client level. Maybe the appropriate starting point is for those of us employed by the microfinance industry to better understand our clients’ financial needs, capabilities, and aspirations. With this improved understanding, we will be able to provide the full range of financial services they need and deliver them in a way that makes them easy to understand and utilize.

So I agree that financial education is the greatest obstacle to financial inclusion, and it is time that we start educating ourselves. Only then will we be able to provide the financial services and education that have real value for our clients.

 

For questions about the "Expert Exchange: Building A Movement Toward Financial Inclusion by 2020" series, write to Sonja E. Kelly, Fellow, Center for Financial Inclusion at ACCION International.

Highlights from the Global Microcredit Summit

January 13, 2012

High Aspirations for the Seal of Excellence: John de Wit on poverty alleviation

In his remarks at the plenary session that opened the Summit, "Beyond 'Ethical' Financial Services: Developing a Seal of Excellence for Poverty Outreach and Transformation in Microfinance", John de Wit, managing director of Small Enterprise Foundation in South Africa, expressed his hopes for the Seal.

What I as a practitioner [am] hoping for is that the Seal will be able to differentiate between those who are really trying to do constructive microfinance-who are really trying to make sure that we do deliver a difference in the lives of poor people, that we give them their chance at dignity, their chance of climbing out of poverty-from a lot of microfinance that is very, very worrying.

Watch the video of John de Wit’s presentation below. Watch the full plenary session on our YouTube channel.

Reclaiming Microfinance: Larry Reed on transformation in microfinance

At the Closing Ceremony, Larry Reed, Director of the Microcredit Summit Campaign, gave a moving presentation on seven steps that we as a community can take to recover the soul of Microfinance and to ensure that our work results in our clients and their families having greater ability and opportunity to climb their way out of poverty.

Watch the clip of Larry Reed’s presentation below (jump to min 27:48).

Additional Highlights from the Summit

2,000 Poverty Fighters Expected to Join Queen of Spain for Global Microcredit Summit

November 14, 2011

VALLADOLID, SPAIN – Nov. 14 – Today, some 2,000 poverty fighters from more than 100 countries will join the Queen of Spain, Nobel Peace Prize Laureate Muhammad Yunus and Danone Chairman Franck Riboud in this historic Spanish city for a monumental four-day global gathering of dignitaries, microfinance practitioners, donors and other poverty fighters from every region of the world.  The Global Microcredit Summit 2011 comes at a critical time, with just four years left for the international community to reach the Millennium Development Goal of halving the world’s population living in extreme poverty by 2015.

Last week it was announced that 137.5 million of the world’s poorest families received a microloan in 2010, an 18-fold increase since the original Microcredit Summit in 1997, when only 7.6 million very poor families had a microloan.  Assuming an average of five persons per family, these 137.5 million microloans affected more than 687 million family members.  That astonishing accomplishment is reason enough to gather the leaders of the industry from across the globe to discuss how to further increase the impact that this powerful development tool has on the fight against global poverty.

But delegates to the Summit will also address the challenges that have accompanied this staggering growth.

“We are inspired by the number of delegates who will join us in Valladolid and expect the next four days to include powerful stories of success, as well as the challenges faced in these trying times,” said Microcredit Summit Campaign director Sam Daley-Harris.  “When we last came together five years ago at the Global Microcredit Summit in Canada, the Norwegian Nobel Committee had just announced that Muhammad Yunus would share the Peace Prize with Grameen Bank, the groundbreaking bank he founded.  Since then, we have faced new challenges, but we must continue to highlight the work of those institutions implementing the most innovative solutions to help their clients rise out of the devastating blight that is extreme poverty.”

Of the more than 100 sessions featured at the Summit, one will have delegates grappling with issues such as over-indebtedness, client drop-outs, unethical collection practices, exorbitant interest rates and mission drift, while another will offer the first public discussion of a Seal of Excellence for Poverty Outreach and Transformation in Microfinance, which has been in development for 19 months.

Microfinance has been called a revolution in banking.  That is no more evident than when Nobel Laureate Muhammad Yunus was asked what his strategy was in forming Grameen Bank.  “I didn’t have a strategy,” Professor Yunus responded. “I just kept doing what was next.  But when I look back, my strategy was, whatever banks did, I did the opposite.  If banks lent to the rich, I lent to the poor.  If banks lent to men, I lent to women.  If banks made large loans, I made small ones.  If banks required collateral, my loans were collateral free.  If banks required a lot of paperwork, my loans were illiterate-friendly.  If you had to go to the bank, my bank went to the village.  Yes, that was my strategy.  Whatever banks did, I did the opposite.”

Sessions at the Summit will demonstrate that microfinance institutions can provide access to financial services and, in some cases, offer non-financial services that can contribute to improvements in the health, education and overall well-being of clients and their families.

The Spanish Secretary of State for International Cooperation Soraya Rodríguez Ramos has made it clear that the Global Microcredit Summit could not have come at a more critical time and that the Spanish government continues to be a strong supporter of microfinance programs committed to helping people work their way out of poverty. The more than 2,000 international and Spanish delegates will gather in Valladolid this week to share innovations, address challenges and continue developing plans for a way forward.

Nearly 2.6 billion people in the world today have no access to formal financial services.  Microfinance works to reduce this gap and to offer non-financial services to help improve the lives of families around the world. Microfinance institutions have the ability to effectively deliver education and health services to the poorest, especially to women living in rural areas of the world.  When combined with savings and loans, these interventions are powerful tools in the fight against global poverty. 

“Time and time again, the clients tell us the same thing when asked what they want for themselves and their families,” said incoming Microcredit Summit Campaign Director Larry Reed.  “They want regular meals, a place to live that keeps the rain and the cold out, education for their children and better health for their families.  That will be the focus of our work at this Summit and in the months and years to ahead.”

The Microcredit Summit Campaign aims to reach 175 million of the world’s poorest families by 2015 and ensure that 100 million of those families move above the World Bank’s $1.25-a-day poverty threshold.

What About Democracy and Governance Here at Home?

September 02, 2011

Executive Director of the Microcredit Summit Campaign, Sam Daley-Harris, wrote the article "What About Democracy and Governance Here at Home?" for the Sept 2011 issue of Monday Developments Magazine, www.mondaydevelopments.org, published by InterAction, the alliance of U.S.-based international nongovernmental organizations (NGOs) who focus on disaster relief and sustainable development around the world. 

 

What About Democracy and Governance Here at Home?

Sam Daley-Harris

When most people read a Monday Developments article about 'democracy and governance' they are more likely to think about institution building in the global South, the Arab Spring, or Iraqi voters leaving polling places with ink-stained fingers.

But what about democracy and civic engagement here at home?  How are we doing on that front and why do the answers to those questions matter so much?

Think about an issue that your institution has taken on.  Perhaps it's funding for child health or basic education, or agriculture.  Can you imagine dozens of members of Congress calling to get your input on those issues?  Can you imagine dozens of editorial writers calling to get your thoughts on an editorial they are writing about why humanitarian foreign assistance programs are so vital?  Can you imagine this happening?

 

In this article, Daley-Harris introduces a new initiative that he will be launching in January 2012: the Center for Citizen Empowerment and Transformation. Read his article here: http://www.microcreditsummit.org/partner_with_us

45 Million Indians Move Above $1.25 A Day

August 16, 2011

WASHINGTON, DC - According to a report released by the Microcredit Summit Campaign, a program of the US-based advocacy group RESULTS Educational Fund, nearly 9 million Indian households involved in microfinance - including approximately 45 million family members, on net - rose above the $1.25 a day threshold between 1990 and 2010.  This good news comes during a difficult time for the sector in India and elsewhere.  Microfinance institutions offer loans that can start at $50 and other financial services that enable the poor to start or expand small businesses.

A survey of more than 15,000 Indian households, led by Shubhashis Gangopadhyay and carried out by Bappaditya Mukhopadhyay and Sambit Rath of the India Development Foundation (IDF), found that a dramatic number of families moved out of poverty between 1990 and 2010.  In point of fact, the microfinance sector in India barely existed before 1998.  The survey was largely completed, however, before the microfinance crisis in Andhra Pradesh erupted at the end of 2010 greatly reducing the number of households served.

"This report is good news, coming out seven months after a similar survey showed significant progress in Bangladesh," said Sam Daley-Harris, Director of the Microcredit Summit Campaign.  "Neither survey was designed to assign causality to microfinance, but there is a significant correlation in both India and Bangladesh between the presence of microfinance and movement out of poverty in the rural areas of both countries, especially in the early years.  The survey period in Bangladesh reflected significant movement out of poverty between 1990 and 1998 followed by a dramatic drop due to massive floods in 1998.  In India, the 'flood' might be seen in the crisis in the microfinance sector but that crisis is not reflected in these findings."

This report comes in the wake of a tremendously successful initial public offering (IPO) in 2010 by SKS in India followed by serious charges about some microfinance practices in that country and a strangling backlash by the Andhra Pradesh government. 

"SKS did microfinance and low income households a major disservice," explains Sanjay Sinha, Managing Director of MicroCredit Ratings International Limited (M-CRIL).  "It sold dreams (in the form of over-ambitious growth targets), obtaining unbelievable valuations of the order of seven times book value for its equity.  Other large MFIs soon followed, copying the SKS growth model.  Multiple lending was inevitable and over-indebtedness followed."

"While it is clear that changes are needed in Indian microfinance, it is critical that we not throw out the baby with the bath water.  Families in rural communities need access to financial services from microfinance institutions that know their clients and are committed to improvements in their lives," said IDF lead researcher Shubhashis Gangopadhyay. 

Globally, microfinance has also been faced with criticism from the academic community.  A series of randomized control trials (RCTs) have questioned the effectiveness of microfinance as a poverty reduction tool.  But these studies, touted for their rigor, have been met with questions of their own.

"Two of the problems I have with the RCTs that have been done to date are that they haven't studied programs that are known for their deep commitment to ending poverty, and they typically cover a 12- to 18-month period, which is too short a time for real change to take place," said Chris Dunford, President of Freedom from Hunger.

These two surveys, IPOs in India and Mexico, and RCTs will be among the issues discussed at the Global Microcredit Summit to be held November 14-17, 2011 in Valladolid Spain.  The work on these surveys is part of the Microcredit Summit Campaign commitment to fulfilling the United Nations Millennium Development Goal of cutting poverty in half by 2015.

Download the Report online:

http://www.microcreditsummit.org/uploads/files/India_Report_FINAL.pdf

                                                        ###                                                                                                       

Microcredit Summit Campaign:

The Microcredit Summit Campaign is a project of RESULTS Educational Fund, a U.S.-based advocacy organization committed to creating the will to eliminate poverty.  The Campaign was launched in 1997 and in 2007 surpassed its original goal of reaching 100 million poorest families with credit for self-employment and other financial and business services.  The next Global Microcredit Summit will be held November 14-17, 2011 in Valladolid, Spain.

www.microcreditsummit.org

 

India Development Foundation:

IDF is a privately funded, non-profit, non-partisan research foundation set up as a Trust on April 2, 2003. Its major objective is to develop awareness about how markets work, why they are desirable and how we can develop them. IDF aims to help policy makers transform emerging economies into market-based societies.

www.idfresearch.org

 

 

Summary of Recent Issues Surrounding Grameen Bank and Prof Muhammad Yunus

June 17, 2011

The international media recently has been full of stories and speculation about Professor Muhammad Yunus and Grameen Bank, joint recipients of the 2006 Nobel Peace Prize for their work fighting poverty. Because of false accusations against Professor Yunus and the Bank – including emails and other materials widely distributed by Sajeeb Wajed, the son of Bangladeshi Prime Minister Sheikh Hasina Wajed, as well as by other government officials – many of the stories were inaccurate and confused. Though Grameen Bank has responded to these allegations through the media and other means, unfortunately this disinformation campaign has continued, so we feel that it is necessary to create this fact sheet, which contains a quick review of the events as they’ve happened, as well as resources for those who want to know the truth.

In late November 2010, a Norwegian television network aired a documentary called “Caught in Micro Debt” that made a number of false accusations about Professor Yunus and Grameen Bank. For example, it said that funds received from a Norwegian aid agency, NORAD, were improperly transferred between Grameen Bank and Grameen Kalyan, its non-profit sister organization. This matter was clarified and settled between NORAD and Grameen Bank in 1998. After the documentary aired, Norway promptly investigated the transaction again, and again said there was no improper use of funds.

The documentary also claimed that Grameen Bank charged from 30% to 200% interest, but a study of Grameen Bank’s interest rates by leading authority MicroFinance Transparency noted that “Grameen has an extremely simple and transparent pricing system,” while a report by the Review Committee appointed by the government (see below) to examine the Bank noted that it has the lowest interest rates of any microfinance institution in Bangladesh, with 20% being its top rate.

Even so, the Bangladesh government – led by Prime Minister Sheikh Hasina Wajed, who reportedly has viewed Professor Yunus as a political rival since he looked into setting up a political party in 2007 – led a campaign to force Professor Yunus from his post as managing director of Grameen Bank, with the 77-year-old finance minister, Abul Maal Abdul Muhith, claiming that the 70-year-old Yunus was “too old” for his post. At a press conference following release of the documentary, the prime minister stepped up the rhetoric, accusing Professor Yunus of “sucking blood from the poor in the name of poverty alleviation.” Other officials of her government, including the Foreign Minister, the Agriculture Minister, top Awami League officials and special advisors, made repeated false allegations and personal attacks against Professor Yunus.

Muhith repeatedly asked for Yunus’s resignation, but Professor Yunus declined, reminding Muhith that – according to the Grameen Bank Ordinance of 1983 – only the Grameen Bank Board of Directors had the right to hire or fire the managing director, since the Bank is an independent entity. (The Bank’s board comprises 13 people, three of whom – including the chairman – are appointed by the government, with nine being elected by the Bank’s 8.3 million borrower-owners, and the managing director as the remaining member.) The government then stepped up the pressure by appointing a disgruntled ex-employee and vocal critic of Professor Yunus, Muzammel Huq, as chairman of the Grameen Bank Board in January.

In early March, the Bangladesh Bank (backed by the Finance Ministry) informed Grameen Bank that Professor Yunus had been acting as managing director without its consent, which it claimed was a violation of its rules. The letter also cited his age as a factor, and called on the Board to take appropriate action. Grameen Bank immediately responded to these allegations, showing that the Bangladesh Bank had given express approval of his appointment, and that his appointment had been extended formally and indefinitely. Professor Yunus and the nine independent Directors then began a legal process to declare the letters invalid. After the country’s High Court summarily dismissed the petition, the petitioners turned to the Appellate Division of the Supreme Court, which in early May also dismissed the petition, despite well-reasoned and impassioned arguments from Grameen Bank’s attorneys.

Grameen Bank has fully cooperated with a Review Committee set up by the Bangladesh government to examine the Bank’s operations. The Review Committee’s report, submitted to the Finance Ministry in late April, confirmed that there was no wrongdoing involved in the transfer of Norwegian aid funds, and acknowledged that Grameen Bank’s interest rates are the lowest in the country. The Committee found no evidence of mismanagement or personal corruption among Grameen Bank employees, complimented Bank staff on their cooperation, and acknowledged the tremendous contributions made by the Bank on the country’s socio-economic condition. However, the Committee’s incorrect assumptions that Grameen Bank is a “government bank” and other incorrect findings prompted a detailed refutation by Grameen Bank.

On May 12, Professor Yunus announced he resigned from his post as managing director of the Bank, handing the position to Deputy Managing Director, Nurjahan Begum, while the Board conducts a search for a permanent replacement. In a letter to his colleagues at the Bank, as well as a letter to the Bank’s borrower-owners, he emphasized the importance of maintaining the Bank’s independence, which the government is threatening to take over.

Professor Yunus has worked tirelessly to create other independent social businesses committed to promoting social good. It now seems as if the government is now looking to take control of these enterprises, too.

Throughout this period, a network of supporters inside and outside of Bangladesh – millions of everyday people, as well as well-known politicians, diplomats and business leaders – have contributed their time and effort to protect the reputation of Professor Yunus and the independence of Grameen Bank. In addition, 3.7 million of Grameen Bank’s borrower-owners signed a petition asking that Professor Yunus stay involved with the Bank in some capacity.

You can help spread the truth and defend the independence of Grameen Bank by sharing this document with your friends, by voicing your opinion on social media channels (Facebook, Twitter, blogs, etc.), and by keeping informed about the latest Grameen Bank and Yunus Centre news.

It’s vitally important that the following points are reinforced in advocacy efforts:

  • Grameen Bank must remain independent and free of government interference.
  • Professor Yunus should be made chairman of Grameen Bank’s Board of Directors, to ensure smooth transition of the Bank’s management.
  • The government must respect the authority of the Bank’s Board of Directors, and not change its composition or reduce the number of elected directors, which would weaken the voice of its borrower-owners.
  • Other Grameen organizations, established as independent social businesses, should remain independent and free of government interference.

Thank you.

Record 128 Million of World’s Poorest Received a Micro-Loan in 2009

March 07, 2011

WASHINGTON, DC - More than 128 million of the world's poorest families received a microloan in 2009--an all-time high, according to a report released today by the Microcredit Summit Campaign. Assuming an average of five persons per family, this means that loans to 128 million poorest clients affected some 641 million family members, which is greater than the combined population of the European Union and Russia. Microloans are used to help people living in poverty start or expand a range of small businesses, such as selling basic staples, producing handicrafts, and delivering cell phone services to remote villages.

Nobel Peace Prize Laureate Muhammad Yunus participated in the news conference by video link from Dhaka, Bangladesh. He is featured in the report in the box on social business.

"Microcredit has very effectively lifted millions of poor women and their families out of poverty," said U.S. Ambassador-at-Large for Global Women's Issues Melanne Verveer. "With the 100th anniversary of International Women's Day being celebrated on March 8th, it is gratifying to see that over 81 percent of the very poor who received microloans were women--that is more than 100 million people. Women entrepreneurs are one of the smartest investments in microfinance. Not only have they shown strong returns in the success of their businesses, but they consistently have demonstrated high loan repayment rates and they re-invest in their families and their communities."

Overall, more than 190 million people had a microloan in 2009; however, the Campaign focuses on the 128 million poorest. In the 12 years since the Campaign's founding, the number of very poor families with a microloan has grown more than 16-fold from 7.6 million in 1997 to 128 million in 2009. The report includes data from over 3,500 institutions with more than 93 percent of the information collected last year and verified by a third party.

"I have joined you from Spain to demonstrate my government's strong commitment to microfinance programs that help people work their way out of poverty, ensuring both financial and social inclusion," said Spanish Secretary of State for International Cooperation Soraya Rodriguez Ramos. "The Spanish government is pleased to be hosting the Global Microcredit Summit in Valladolid, Spain in November of this year, providing an opportunity for all 2,000 delegates to share their innovations, forge solutions to the challenges, and deepen their commitment to this very critical work."

The State of the Microcredit Summit Campaign Report 2011 also announced the development of a Seal of Excellence for Poverty Outreach and Transformation in Microfinance which has been under discussion for 11 months and will continue to evolve throughout this year and beyond with input from a broad range of stakeholders. The Seal will recognize those institutions doing the most to help families lift themselves out of poverty. Acknowledging the range of critical initiatives in the microfinance field, Campaign Director Sam Daley-Harris said, "The Seal is working to build on the Smart Campaign's client protection principles and the work of the Social Performance Task Force and is discussing ways to implement the seal that would use the systems that have already been developed for understanding the social performance of microfinance institutions." Download the draft concept note and a request for feedback.

"With such incredible growth in microfinance there is a need for some certification, some objective measurement that makes it clear to the outside world that these are the goals of those microfinance institutions that are committed to reducing poverty and these are the institutions reaching those goals," said Chuck Waterfield, founder of MicroFinance Transparency. "Efforts such as a Seal of Excellence on Poverty Outreach and Transformation are needed--and needed now."

The report also addresses the debates in the microfinance sector over the initial public stock offerings (IPOs) at two microfinance institutions: Compartamos in Mexico and SKS in India. Those in favor of this move argue that commercial finance is a critical source of funds for the field. They also believe that the large profits generated for investors and senior management will attract additional commercial investors. Critics worry, however, that investors profiting from an industry created specifically to benefit those in poverty undermines the perception, purpose, and integrity of the microfinance field.

In the report, leaders from Compartamos and SKS write in favor of the IPOs and critics respond. Vikram Akula, founder of SKS and a leading IPO advocate, argues that, "From a client perspective, it does not matter whether the investors are earning very high profits or not. What matters to them is, are they getting a loan on time, can they generate income, and can they get their families out of poverty?" But David Porteous, President of Bankable Frontiers, worries about the long-term consequences of negative publicity that includes some cases of abusive collection practices and of people getting rich by providing loans to the poor.

In an extended interview in the report, Sir Fazle Abed, the founder of BRAC in Bangladesh, who was knighted last year by Queen Elizabeth for his work in ending poverty, speaks of the great hope and the troubling concerns in the field today.

"Microfinance is the most exciting thing that has happened to poor people over the last 30 years in terms of social inclusion," he affirmed. "By ensuring financial inclusion we have worked with the poor in a way that honors their dignity, and we have shown that poverty alleviation needs a multi-pronged approach." When asked about his concerns he replied, "There is a lot of greed coming into microfinance. A lot of people wish to make a lot of money out of it, and that worries me. Although I understand the rationale--when return on investment is high, more money will flow into the sector, but people should not take advantage of it and make money out of poverty." He also stressed that the sector needs to address the issue of over indebtedness that may be affecting some segments of the borrowers and not lose sight of its development focus.

Nobel Peace Prize Laureate and Microcredit Summit Campaign co-founder Professor Muhammad Yunus hopes that microfinance institutions will remain committed to their mission of helping the poor by charging low interest rates and that appropriate laws will be adopted for MFIs to access local deposits and to be able to lend out those deposits rather than seeking loan funds from commercial investors. In the report, Professor Yunus focuses on a new category of business named social business. This is a non-loss, non-dividend company dedicated to solving social or economic problems. With Danone, the French yogurt maker, Grameen companies have launched one such business to address child malnutrition in Bangladesh, producing a very low-cost yogurt that contains all the micro-nutrients that children are missing. With Adidas, the German shoe manufacturer, Grameen has initiated another social business that will provide shoes for less than US$1.50 per pair to poor people in Bangladesh.

"This will have an enormous impact on health," said Prof. Yunus, "because poor people suffer from diseases like hookworm that come through the skin of their feet. We want to make low-cost shoes that children and adults can afford to wear all the time."

"It's important to note that microfinance is so much more than just credit for microentrepreneurs," said Larry Reed, the report's author and former CEO of the Opportunity International Network. "Some of the most compelling impact data is coming from savings programs for the poor and very poor, and there is a lot of promise in outreach to rural areas, including agriculture finance and insurance, especially when integrated with other development efforts."

Janet Bett a client and staff member of the microfinance institution Jamii Bora in Kenya exemplifies the transformational dimension of microfinance. When the abuse in her home became unbearable, she left her husband to live on the streets. She cared for her six children as best she could and survived by begging. After seven years of homelessness she met Jamii Bora founder Ingrid Munro who arranged a place for Janet and her children to stay. Munro encouraged Janet to start a weaving business. After saving $5-$10 dollars each, a total of 50 women beggars received their first loans from Munro, and Jamii Bora was born. Today, Janet serves as a senior manager at Jamii Bora and all of the members on her team have been beggars themselves at one time. When they meet a potential member who does not believe that his or her life can change, Janet tells them, "If I could do it, you can, too." Janet is proud of her children who have finished university. Three are teachers, one is a pharmacist and the other works in a medical clinic.

In 1997, fewer than 8 million of the world's poorest were receiving microloans. Now Janet Bett has played a part in helping to reach more than 128 million very poor clients. The Microcredit Summit Campaign aims to reach 175 million of the world's poorest families by 2015 and ensure that 100 million of those families move above the World Bank's $1.25-a-day poverty threshold.

Download the Report online: http://www.microcreditsummit.org/pubs/reports/socr/2011/SOCR_2011_EN_web.pdf

###

Microcredit Summit Campaign:

The Microcredit Summit Campaign is a project of RESULTS Educational Fund, a U.S.-based advocacy organization committed to creating the will to eliminate poverty. The Campaign was launched in 1997 and in 2007 surpassed its original goal of reaching 100 million poorest families with credit for self-employment and other financial and business services. The next Global Microcredit Summit will be held November 14-17, 2011 in Valladolid, Spain. www.globalmicrocreditsummit2011.org.

10 Million Bangladeshis Move Above $1.25 a Day

January 28, 2011

WASHINGTON, DC — Nearly 2 million Bangladeshi households involved in microfinance — including almost 10 million family members, on net — rose above the US$1.25 a day threshold between 1990 and 2008. These figures were released in a report by the Microcredit Summit Campaign today.

A survey of more than 4,000 Bangladeshi households, led by Sajjad Zohir of the Dhaka-based Economic Research Group, found that a dramatic number of families moved out of poverty between 1990 and 1997, but that a massive flood in 1998 and the food and fuel crisis of 2008 were the likely cause for millions of families to fall below the $1.25 a day threshold during that later period. Even with these setbacks, on net nearly 10 million people rose above poverty.

The Microcredit Summit Campaign report closely mirrors the findings of official country-level research in Bangladesh with the national Household Income and Expenditure Survey (HIES) estimating that 10.62 million Bangladeshis left hardcore poverty between 1990 and 2005. Zohir, the report’s author writes, “[O]ur estimate seems quite in line with the national level poverty findings.”

“While the Bangladesh survey was not designed to assign causality, it is very significant that the number of microfinance clients who left poverty closely links to the national data on poverty reduction,” said Microcredit Summit Campaign Director Sam Daley-Harris. “The majority of poverty in Bangladesh is in rural areas and so are the majority of microfinance clients.”

This good news comes during a difficult time for the microfinance sector. In recent years, microfinance programs have seen growing questions about their effectiveness. Several randomized controlled trials (RCTs) matched microfinance clients with control groups and showed no movement out of poverty in the group receiving the microloans. But these studies, touted for their rigor, have been met with questions of their own.

“Two of the problems I have with the RCTs that have been done to date are that they haven’t studied programs that are known for their deep commitment to ending poverty, and they typically cover a 12- to 18-month period, which is too short a time for real change to take place,” said Chris Dunford, President of Freedom from Hunger. “We have to remember that not all microfinance programs are the same. This new study from Bangladesh includes a large number of clients from BRAC and Grameen Bank, two Bangladeshi institutions known for their groundbreaking efforts to end rural poverty.”

Another setback for microfinance came in the wake of a tremendously successful initial public offering (IPO) in 2010 by SKS, an Indian microfinance program based in the state of Andhra Pradesh. Soon after the IPO’s success, serious charges began to emerge in the state about microfinance borrowers taking on multiple loans and too much debt, coercive collection practices by microfinance staff and even suicides spurred by these challenges.

“There are quite a few people who believe that microfinance has lost its way,” said Alex Counts, President and CEO of Grameen Foundation. “This Bangladesh survey reminds us that, even in the most difficult circumstances, major progress can be made. Bangladesh is not the ‘bottomless basket case’ that then-U.S. Secretary of State Henry Kissinger called it 35 years ago. It is instead a teacher to the rest of the world, with its civil society leading the way.”

The Bangladesh survey was administered between February and August 2009.

Download the report online: http://www.microcreditsummit.org/uploads/files/Bangladesh_Report_FINAL.pdf

 

Microcredit Summit Campaign:

The Microcredit Summit Campaign is a project of RESULTS Educational Fund, a U.S. based advocacy organization committed to creating the will to eliminate poverty. The Campaign was launched in 1997 and in 2007 surpassed its original goal of reaching 100 million poorest families with credit for self-employment and other financial and business services. The next Global Microcredit Summit will be held November 14-17, 2011 in Valladolid, Spain. 

Economic Research Group:

The Economic Research Group (ERG) is a not-for-profit organization based in Bangladesh and was established to promote education and research with a view to improving social economic justice. ERG seeks to bridge the gap between academic research and policy analysis within Bangladesh and other countries of South and Southeast Asia. Through its work, ERG also aims to extend the frontier of knowledge on developing economies through analytical research and discussion of views on contemporary economic issues. www.ergonline.org

 

Number of Microcredit Clients Crossing the US $1.25 a day Threshold during 1990-2008
Estimates from a nationwide survey in Bangladesh

Executive Summary Highlights

The Microcredit Summit Campaign is committed to using microfinance to powerfully contribute to the end of poverty. Its decade-long focus on client poverty measurement and progress out of poverty underscores this commitment. To this end, the Campaign has begun to track progress towards its second goal to ensure that, from a starting point in 1990, 100 million of the world’s poorest families move from below $1.25 a day, adjusted for purchasing power parity (PPP), to above $1.25 a day adjusted for PPP by 2015.

Evidence from Bangladesh

Findings from a nationwide study in Bangladesh commissioned by the Campaign show promising results. The study, undertaken by the Bangladesh-based Economic Research Group, was administered between February and August 2009. Researchers surveyed a nationally representative sample of 4,000 Bangladeshi microcredit clients and estimated the net number of households in Bangladesh that crossed the US$1.25 a day threshold between 1990 and 2008.*

The study found that, on net, 1.8 million microcredit client households, including 9.43 million household members, crossed the $1.25 a day poverty threshold between 1990 and 2008. A second key issue raised in the report, seen in Figure 1 below, was that in some years a large percentage of clients left poverty, whereas, in years coinciding with the 1998 floods and the food and fuel crisis of 2008, many households, including some who were non-poor when they joined the microcredit program, slid below the $1.25 threshold.

Percentage of client households, on net, crossing the US $1.25 threshold in Bangladesh

Percentage of client households, on net, crossing the US $1.25 threshold in Bangladesh

It is important to note that the findings in this report were significantly influenced by the period in which the data was collected. In 1998, Bangladesh suffered from what are often described as the most severe floods ever to hit the country. Beginning in 2005, a food crisis coupled with political instability in Bangladesh and the 2008 global economic crisis led to a general drop in economic activity. All these factors may have led to the depletion of assets that are commonly chosen as proxies to measure poverty status among the very poor in Bangladesh. This in turn may have led to under-estimation of the number of microcredit client households that may have otherwise crossed the threshold.

* This study made no attempt to establish causality between microcredit and poverty alleviation. Instead, it simply estimates the change in status of microcredit client households between 1990 and 2008, when compared with their status during the time of the first loan received by any member of the household.

 

Survey Methodology

Time Period and Sampling

The data for this study was gathered between February and August 2009. Information was collected from a nationwide Bangladesh sample of close to 4,000 households to determine the net number of households who crossed the $1.25 threshold as of the end of 2008.

The random sample of households surveyed was taken only from ever borrower households – households where one or more members had borrowed from one or more microcredit institutions at least once between 1990 and 2008.

Of the households surveyed, 94% were based in non-metropolitan areas and 4% in metropolitan slums. The non-metropolitan sample was drawn from information compiled on more than 10,000 ever borrower households nationwide while the metropolitan sample came from a more targeted group of some 1,500 ever borrower households from slums in three major cities that have attracted the most domestic migrants since 1990 (Dhaka, Chittagong and Sylhet).

Data Collection and Analysis

Four different poverty scorecards were used to develop a questionnaire. When administered, the questionnaire allowed researchers to estimate percentages of ever borrower households who were below the threshold of the international poverty line (US $ 1.25 PPP per person per day) in the year when the first microcredit loan was taken as well as during the time of the survey. The difference was then used to estimate the net number of households who had crossed the threshold. In addition, a life history interview provided insights and made it possible for researchers to trace the time path of a household’s wellbeing status using several qualitative and quantitative dimensions that the poverty scorecards did not address.

The sample was drawn from a large pool of information on shares of microcredit borrowers by smaller geographical units across metropolitan and non-metropolitan areas; and appropriate sampling weights were used to blow up the estimates of sample areas to a national level estimate.

 

Next Seven Workshops Authors Announced for the 2011 Global Microcredit Summit

December 13, 2010

More than 50 Workshops are being organized for the upcoming 2011 Global Microcredit Summit

We are pleased to announce these authors for workshops that will be presented at the 2011 Global Microcredit Summit to be held from November 14-17, 2011 in Valladolid, Spain.

What is the Problem: Getting an Empowering Regulatory Framework that Allows Taking and On-lending Deposits and Truly Works for MFIs, their Clients and the End of Poverty
Crispin Bokea, Director, Policy & Grant Management, Alliance for Financial Inclusion, Bangkok, Thailand

The Debate on Outreach and Impact of Microfinance: What Do We Know and How Do We Know It
David Gibbons, Chairman, CASHPOR, India

Sharing the Lessons Learned on Strengthening MFIs so that They can Weather the Challenges of the Current and Future Financial Crises and Fluctuations in Food and Fuel Prices
Adrian Gonzalez, Lead Researcher, Microfinance Information Exchange (MIX), USA

Empowering the Children of Microentrepreneurs with Primary and Secondary Education, College Scholarships and Loans, and Financial Services for Their Businesses
Author: Joanna Kuebler, Director, Global Campaign for Education, RESULTS Educational Fund, USA

How Can Microfinance Contribute to Restoring Dignity and Transforming Lives in Urban Slums?
Rob Gailey, Director for International Development, Assoc. Prof. School of Business, Point Loma Nazarene University, USA

Motivating Your Board of Directors to Actively Promote and Deepen Your Social Mission
Aldo Moauro, Executive Director, Microfinanza Rating, Italy
Micol Guarneri, Social rating Director, Microfinanza Rating, Italy

Learning from Real World Experiences: Lessons Learned in Using Microfinance in Post Conflict and Post Disaster Situations
Warner Woodworth, Professor of Social Entrepreneurship, Brigham Young University, USA

 

Previously Announced Authors for Workshops at the Global Microcredit Summit 2011

 

Examples of How Technology has Worked for the Clients and for MFIs, Especially for Those Living and Working in the Hardest to Reach Areas
David Edelstein, Vice President - Technology Programs, Grameen Technology Center, Grameen Foundation, USA

Obtaining Funds from New Financial Instruments and Mechanisms for Commercial and Emerging MFIs: From Funds to the Web
Zina Sanyoura, Investment Manager, BlueOrchard Investments SARL, Switzerland
Elvira Espejo, Investment Associate, BlueOrchard Investments SARL, Switzerland
Tim Hassett, Vice President - Microfinance, KIVA, USA

Financial Literacy Programs that Work for the Clients and for the MFI
Monique Cohen, Founder & President, Microfinance Opportunities, USA

Product Innovations: New Offerings that Maximize Benefits to Clients, MFIs and their Communities
Michael Hamp, Senior Technical Advisor - Rural Finance, International Fund for Agricultural Development (IFAD), Italy

Breaking the Rules of Microfinance to Better End Poverty and Catalyze Its Transformational Dimension: Conversations with Industry Pioneers to Explore the Soul of Microfinance
Lynne Patterson, Co-Founder and Co-Director, Pro Mujer, USA

Remittances and Microfinance: Using Remittances for Productive Investments that Contribute to Sustainable Community Development
David Myhre, Consultant, Canada

Transforming from NGO to Regulated MFI while Maintaining Your Commitment to Empowering the Poor: A Step by Step Process
Mary Ellen Iskenderian, President and CEO, Women's World Banking, USA

How Can Microfinance for Housing Catalyze Slum Improvements and New Settlements?
Patrick Kelley, Director of International Housing Finance, Habitat for Humanity, USA

How Can Microfinance Programs Help the Struggle Against Social Problems such as Begging, Child Labor, Prostitution, Violence Against Women, Criminality, Gangs and Drug Addiction?
Bill Maddocks, Coordinator of the Sustainable Microenterprise and Development Program, The Carsey Institute, University of New Hampshire, USA

Why Integrating Microfinance, Health Education, and Other Forms of Health Protection is Good for Your Clients and Good for Your MFI, and How Can You Incorporate It?
Chris Dunford, President, Freedom from Hunger, USA

Initial Public Offerings (IPOs): The Field's Salvation or Downfall?
Vikram Akula, CEO, SKS Microfinance, India
Sanjay Sinha, Managing Director, M-CRIL, India

What is the Low-Bar and What is the High-Bar on Client Protection?
Beth Rhyne, Managing Director, Center for Financial Inclusion at ACCION International, USA

Is Transparency Enough: What Is Fair and Ethical When It Comes to Interest Rates in Microfinance?
Chuck Waterfield, CEO & President, MFTransparency, USA

Where is Microfinance Most Powerfully Linked with Sustainable Agriculture, Renewable Energy, Water and Sanitation to End Poverty and Mitigate Climate Change?
Elizabeth Israel, Co-Founder and President, Green Microfinance, USA

Microcredit and Job Creation
Bernd Balkenhol, Program Manager, Social Finance Program, International Labour Organization (ILO), Italy

Process of Designing and Implementing a National Strategy for Financial Inclusion: Challenges and Lessons Learned
Beth Porter, Policy Coordinator, United Nations Capital Development Fund (UNCDF), USA

Best Practices for National and Regional Microfinance Networks
Diana Deszo, Program Director, The SEEP Network, USA

Why Invest in People? How to Develop Skilled and Committed MFI Staff in Order to Reach Strategic Objectives
Peg Ross, Director, Grameen Foundation's Human Capital Center, USA

From Micro- to Small and Medium Enterprise: How do You Grow with Your Clients, Especially the Women, or Allow Them to Graduate to Institutions that Can Meet Their Expanding Needs?
Roshaneh Zafar, President, Kashf Foundation, Pakistan

When Clients Grow Old: Microfinance Strategies and Products that Address the Needs of the Elderly
John Hatch, Founder, FINCA International, USA

What is the Cutting Edge for Microfinance in Remote, Hard to Reach Areas?
Anne Hastings, CEO, Fonkoze, Haiti

Finding Solutions to the Currency Risk Challenge for MFIs, Investors and Donor Agencies
Brian Cox, Executive Director, MFX Solutions, USA

Best Practices in Community Managed Savings Groups and Other Forms of Micro-Savings for Successfully and Sustainably Reaching the Very Poor
Chris DeNoose, Managing Director, World Savings Bank Institute, Belgium
Jeff Ashe, Manager of Community Finance, Oxfam America, USA
Lauren Hendricks, Executive Director, Access Africa, CARE, USA

What Can Branchless Banking Do to Advance the Field, and What Can It Not Do? From Mobile Banking to Point of Service
Claire Alexander, Senior Program Officer, The Bill & Melinda Gates Foundation, USA

How Have Micro-Franchises Improved Income Opportunities and the Lives of Community Members, and How Can MFIs Make Them Available to Their Clients
Jason Fairbourne, Peery Fellow, The Ballard Center for Economic Self-Reliance, BYU, USA

Catapulting Youth Livelihoods: Finance-Plus Strategies to Improve Attitudes and Behaviors, Provide Hope and Opportunity
Lara Storm, Director of Youth-Inclusive Financial Services, Making Cents, USA

Why Managing for Social Performance is More Important than Just Measuring It, and How Can MFIs Best Use These Insights?
Laura Foose, Coordinator, Social Performance Taskforce, USA

Women are Useful to Microfinance: How Can We Make Microfinance More Useful to Women?
Linda Mayoux, Independent Microfinance Consultant, UK

A Deeper Look at Programs that Work with the Ultra-Poor: From Safety Net Programs to Other Innovations
Nathanael Goldberg, Financial Inclusion Director, Innovations for Poverty Action, USA

What Have We Learned about the Most Effective Ways to Use Micro-Insurance to Reduce Vulnerability: Health, Life, Disaster and More
Richard Leftley, President & CEO, MicroEnsure, UK

 


Workshops Announced for the Global Microcredit Summit 2011

August 18, 2010

  • The Debate on Outreach and Impact of Microfinance: What Do We Know and How Do We Know It
  • Breaking the Rules of Microfinance to Better End Poverty and Catalyze Its Transformational Dimension: Conversations with Industry Pioneers to Explore the Soul of Microfinance
  • Product Innovations: New Offerings that Maximize Benefits to Clients, MFIs, and their Communities
  • How Have Micro-Franchises Improved Income Opportunities and the Lives of Community Members, and How Can MFIs Make Them Available to Their Clients
  • What Have we Learned about the Most Effective Ways to Use Micro-Insurance to Reduce Vulnerability: Health, Life, Disaster and More
  • Why Integrating Microfinance, Health Education, and Other Forms of Health Protection is Good for Your Clients and Good for Your MFI, and How Can You Incorporate It?
  • Catapulting Youth Livelihoods: Finance-Plus Strategies to Improve Attitudes and Behaviors, Provide Hope and Opportunity
  • Empowering the Children of Microentrepreneurs with Primary and Secondary Education, College Scholarships and Loans, and Financial Services for Their Businesses
  • When Clients Grow Old: Microfinance Strategies and Products that Address the Needs of the Elderly
  • From Micro- to Small and Medium Enterprise: How do You Grow with Your Clients, Especially the Women, or Allow Them to Graduate to Institutions that Can Meet Their Expanding Needs?
  • Examples of How Technology has Worked for the Clients and for MFIs, Especially for Those Living and Working in the Hardest to Reach Areas
  • What is the Cutting Edge for Microfinance in Remote, Hard to Reach Areas?
  • Women are Useful to Microfinance: How Can We Make Microfinance More Useful to Women?
  • Successes in Inclusion of People Affected by HIV and AIDS: How to Make Sure that No One is Left Out
  • Best Practices in Community Managed Savings Groups and other forms of micro-savings for Successfully and Sustainably Reaching the Very Poor
  • A Deeper Look at Programs that Work with the Ultra-Poor: From Safety Net Programs to Other Innovations
  • How Can Microfinance Contribute to Restoring Dignity and Transforming Lives in Urban Slums?
  • How Can Microfinance for Housing Catalyze Slum Improvements and New Settlements?
  • How Can Microfinance Programs Help the Struggle Against Social Problems such as Begging, Child Labor, Prostitution, Violence Against Women, Criminality, Gangs and Drug Addiction?
  • Financial Literacy Programs that Work for the Clients and for the MFI
  • Remittances and Microfinance: Using Remittances for Productive Investments that Contribute to Sustainable Community Development
  • Where is Microfinance Most Powerfully Linked with Sustainable Agriculture, Renewable Energy, Water and Sanitation to End Poverty and Mitigate Climate Change?
  • Learning from Real World Experiences: Lessons Learned in Using Microfinance in Post Conflict and Post Disaster Situations
  • Microcredit and Job Creation
  • Microfinance as a Vehicle to Create a Platform for Ownership of Financial Institutions by the Poor
  • Process of Designing and Implementing a National Strategy for Financial Inclusion: Challenges and Lessons Learned
  • What is the Low-Bar and What is the High-Bar on Client Protection?
  • Best Practices for National and Regional Microfinance Networks
  • Motivating Your Board of Directors to Actively Promote and Deepen Your Social Mission
  • Why Invest in People? How to Develop Skilled and Committed MFI Staff in Order to Reach Strategic Objectives
  • Transforming from NGO to Regulated MFI while Maintaining Your Commitment to Empowering the Poor: A Step by Step Process
  • Why Managing for Social Performance is More Important than Just Measuring It, and How Can MFIs Best Use These Insights?
  • What is the Problem: Getting an Empowering Regulatory Framework that Allows Taking and On-lending Deposits and Truly Works for MFIs, their Clients and the End of Poverty
  • Finding Solutions to the Currency Risk Challenge for MFIs, Investors and Donor Agencies
  • Sharing the Lessons Learned on Strengthening MFIs so that They can Weather the Challenges of the Current and Future Financial Crises and Fluctuations in Food and Fuel Prices
  • Is Transparency Enough: What Is Fair and Ethical When It Comes to Interest Rates in Microfinance?
  • Initial Public Offerings (IPOs): The Field's Salvation or Downfall?
  • What Can Branchless Banking Do to Advance the Field, and What Can It Not Do? From Mobile Banking to Point of Service
  • Microcredit and Crop Agriculture: New Technologies and Other Innovations to Address Food Insecurity Among the Poor
  • Obtaining Funds from New Financial Instruments and Mechanisms for Commercial and Emerging MFIs: From Funds to the Web
  • The Pros and Cons of Government Run Microfinance Programs: How to Avoid the Pitfalls and Reap the Benefits
  • Best Practices in Islamic Microfinance
  • Grants, Matching Grants and Smart Subsidies: Potentials and Pitfalls
  • What Makes a Wholesale/Autonomous Microfinance Fund Work, and How Can Funds of Top Quality Expand Around the World?
  • Discussion of Nationwide Surveys in India and Bangladesh on Client Movement Above the US$1.25 a Day Threshold and on Tools MFIs are Using to Measure that Movement

Launch of Spanish National Host Committee. Remarks by Sam Daley-Harris

April 14, 2010

Your Majesty the Queen of Spain, Secretary of State for International Development Soraya Rodriguez Ramos, Muhammad Yunus, and distinguished participants and guests. It is a great honor to be with you today to launch the National Host Committee for the Global Microcredit Summit to be held November 14-17, 2011 in Valladolid, Spain.

More than 2,000 delegates from more than 100 countries will come to Valladolid for the Summit. They will come to further the Summit’s goals for 2015: to reach 175 million of the world’s poorest families, especially the women of those families, with credit for self-employment and other financial and business services and to ensure 100 million families rise above the US$1 a day threshold.

I had the honor of being with Her Majesty and Muhammad Yunus last week at the Africa-Middle East Regional Microcredit Summit in Nairobi, Kenya. Let me tell you what I learned at that Summit and hope to bring to the Summit in Valladolid.

As many of you may know, the field of microfinance is not just at a fork in the road but beyond a fork in the road. One fork treats microfinance as a profit-maximizing vehicle, as a way for investors and senior staff to make money from the poor. Of course people like Professor Yunus stand for the other fork in the road, a path whose primary focus is to use microfinance to better end poverty, to improve people’s lives, not to make money for investors.

Here is how I have changed as a result of the Summit last week in Kenya. I now see that the spiritual dimension of microfinance, the redemptive dimension of microfinance is central to my vision for the field. The technical issues surrounding microfinance are important, but only if they serve the transformational dimension.

When Prof. Yunus lent a grand total of US$27 to 42 desperately poor Bangladeshis in 1976, it turned out to be much more than just an economic transaction. One of the 42 borrowers was Sufia Khatum, a stool maker who struggled to survive on 2 cents a day. That was all that was left after she borrowed money from the money-lender to buy the bamboo to make her stools and then sold the finished product back to the money-lend at a price he set. The price he set barely covered the cost of the bamboo. Her profit each day—just two cents. As Prof. Yunus has said, he was ashamed to live in a country where people could work so hard and only make 2 cents a day. But with her loan of less that US$1 from Prof. Yunus, Sufia Khatum was able to pay off the money lender, buy her raw materials, make her stools, and then sell the stools to the highest bidder. Her profit soared 60 fold, from 2 cents a day to $1.25 a day.

Prof. Yunus talks about how surprised he was that such a small amount of money could make 42 desperately poor people so very happy. It freed them from the money-lender. It freed them from debt bondage. And I would add it unleashed the human spirit. It is not only a story of economic transformation but of spiritual transformation. This is the story we must tell and must contrast with those going down the profit maximizing fork in the road.

Prof. Yunus also says the very poor are like bonsai trees. They have every quality they need to blossom and grow into a huge tree, but the conditions they are grown in keep them small, just as the conditions of poverty keep the poor small and don’t allow them to reach their full potential. Prof. Yunus says that a loan of $50 to a poor woman allows her to discover who she is at $50. The next loan of $100 allows her to see what her potential is at $100, and so on. That is unleashing the human spirit—the spiritual side of microfinance. Let me read this excerpt from my closing ceremony speech at the Summit in Kenya.

[Quote] When the Summit opened, I spoke about the gang member known as “the general” whose life had been transformed by microfinance. I said that there are many vision for microfinance including this one: microfinance for redemption. The dictionary defines redemption as restoring one’s honor and worth, setting one free.

It was at the Summit in Kenya that I realized that there might be many visions for microfinance, but my vision for the field is microfinance for redemption. On the first day of the Summit Ingrid Munro of Jamii Bora introduced us to Wilson Maina who was one of the most wanted criminals in Mathare Valley slum in Nairobi. Wilson said he would rather die quickly from a policeman’s bullet than die a slow, death from hunger. That was why he had turned to crime.

But a member of Jamii Bora’s staff saw a better life for Wilson and helped him see a better life for himself. Over a one year period Wilson saved $10, none of it from stealing, and then received a $20 loan. Wilson now has four businesses and has convinced hundreds of youth to get out of crime. How is that for a return on investment? He has convinced hundreds of youth to get out of crime. It might not be the return on investment some investors want, but it is the return on investment that communities need and the return on investment that the world needs.

The world’s poor need this kind of redemption—redemption that restores their honor and worth and sets them free. Redemption that Prof. Yunus saw with the $27 he lent to 42 people 34 years ago—redemption he has seen over and over again for more than three decades.

And here is another kind of transformation the world needs—that we look at people whom we had previously seen as the problem instead as the solution. The world needs us to change our own thinking rather than writing people off as incapable of transforming their own lives. [End quote]

I hope that like me, the Summit in Valladolid will bring profound changes in thinking and action for the delegates. We are delighted to work with the National Host Committee that is being introduced today. We are grateful for their partnership and for the contribution they will make to a successful Summit, a Summit that brings us closer to the end of poverty and to the unleashing of the human spirit. Muchas gracias.

Spain to Host 2011 Global Microcredit Summit

June 19, 2009

The Spanish Secretary of State for International Cooperation, Soraya Rodriguez signed the official agreement between the Spanish Agency of International Development Cooperation (AECI) and the RESULTS Educational Fund. Spain is the second largest bilateral donor to international microfinance.  The signing was presided over by Queen Sofia, the honorary co-chair of the Microcredit Summit Campaign.  She emphasized her belief that the Global Summit in 2011 will have a positive impact, improve the microfinance field, and help acheive the Millennium Development Goals.  Queen Sofia said that she hoped that the Global Summit will become a landmark in the economic and social development of the poor. The 2011 Global Summit in Valladolid, Spain is expected to bring together over 2,000 delegates, from over a hundred countries.

The first Global Summit, held in Washington in 1997, set a goal to ensure that 100 million of the world's poorest families, especially women, would receive microcredit and other financial and business services by 2005.  This target was nearly reached.  Therefore, a new campaign was launched in November of 2006, with two new goals: to work to ensure that 175 million of the poorest families receive credit for self-employment and other services, as well as working to raise the income of 100 million families above the dollar a day threshold.

To read more about the signing ceremony:

From Salamanca News, please click here.

From Once News, please click here.

From El Mundo News, please click here.

From ADN, please click here.

From La Cerca news, please click here.

From EcoDiario news, please click here.

Microcredit Borrower Stories

January 01, 2007

Read some of the inspiring true stories of microcredit borrowers from around the world...

 

Ana Ruiz from Nicaragua

Before receiving a $100 microloan to expand her tortilla business, Ana Ruiz of Nicaragua lived in a scrap wood shack with her eight children. She had no furniture except for her worktable and her children never had shoes or attended school. After her second loan she was able to send her four oldest to school and buy eight plastic chairs so the children wouldn't have to sit in the dirt. Before her microloan, her children were malnourished. "The little ones run around now," she says. "They go to sleep early because they are tired from playing around, not because they are weak."

Gonuguntla Mariamma from India

Gonuguntla Mariamma was born into a poor family in rural Andhra Pradesh, India. Her family's livelihood depended on agricultural labor, which depended on the unpredictable monsoon rains.

When Mariamma was eight years old her mother died due to ill health and an improper diet. Mariamma had to look after the household and couldn't attend school. To make matters worse, she was married off to a relative when she was 10. She had to become a wife and take on added responsibility. Her husband's family was large, consisting of eight members.

They owned two acres of dry land that was not cultivable, so the only option was to work as laborers. Each of them worked in the fields. As her family grew to five children, it became extremely difficult to run the household. She could not educate her children. She married the girls and sent the boys to work in the fields. Mariamma felt there should be some other path for sustenance, so after difficult days in the fields she began to take up sewing. She approached the local Mahila Mandal (Women's Association) in her neighborhood, learned to sew and bought a sewing machine.

At this point, SHARE was conducting its projection meeting in that village. Initially Mariamma was a little hesitant, but knew she had to take this opportunity because all her life she wanted to do something but did not have the chance. Mariamma took intensive training from SHARE on their methodology and loan procedures and she practiced her signature. This was a wonderful experience for her because she had not gone to school or written on a slate.

She took her first loan of $80 and bought a buffalo. She took a seasonal loan of $40 and bought grass and fodder. Mariamma was happy to see money flowing into her household. She gained confidence and the desire to earn more. She dreamed big now. Mariamma knew she could handle more buffaloes. She took her second loan and bought another buffalo. Now she owned two. She took her third loan, bought another buffalo and two goats. Unfortunately one buffalo died. But this did not dishearten her. With the income that she earned from her productive assets, she revived the dry land that her husband possessed and planted oranges.

Today Mariamma is a proud owner of 4 buffaloes, one calf, and 17 goats. She has a telephone and a television. She can sign her name, count money, and read a little. She is thrilled because she was instrumental in reviving her wasteland and has 30 bags of rice for her family. Her future looks bright to her now.

Janèt Dèval from Haiti

Janèt Dèval, a client of Fonkoze, a microcredit institution in Haiti, has been a credit client for more than two years and comes regularly to all meetings. She has also been a part of every literacy program available and is about to start the newest module on developing business skills. Not only could she not read or write when she started, but she has had an extra challenge: Janèt has only a fraction of her hearing due to an injury when she was 20 years old.

In Janet's words:

My husband didn't want me to send my five children to school because his parents didn't send him to school. From the beginning, he said he would not pay and he has never given even one goud, but I always knew it was important. For a long time I have gone to Port-au-Prince to buy goods to sell in Hinche, and I put all my money into paying for school for my children.

When I found out that Fonkoze gave literacy classes for market women, I was so happy. I never went to school even one day. I didn't know anything about school. I started right away with basic literacy and I have tried to never miss a class.

I couldn't write my name and I didn't understand anything, but I kept going even when my husband got angry. My kids pushed me and encouraged me and they helped me practice my letters. The monitor, Christa, told me to keep writing every day even when I didn't understand.

I can write my name now, and I write it everywhere. Imagine, I used to go to Port-au-Prince to buy and I couldn't read the bags and I felt lost. I couldn't keep track of what I bought. The drivers sometimes would take my boxes off the truck and give them to someone else, but I didn't know until I got all the way home. Now, I can't lose anything. Now I write my name on every box and I know what I buy.

I finished Alfa Baz and Alfa Pos and then I went to the Health Program, too. I still don't know many things, so I want to keep going. I take my notebook to my school and I write in it because one day I hope to read and understand everything. I bought two books in the market and my kids help me read them.

I work hard in the market so that I can repay my loans, keep going to school and so that my kids have that chance, too. If my parents would have sent me to school, I would have thrown a party for them to say thank you.

Alice Pallewela from Sri Lanka

When Alice Pallewela of Sri Lanka needed money to support her family, she turned to what she knew--candy and her credit union. This unlikely combination changed her life and her village's perception of its credit union.

After Pallewela married, her husband, a government employee, transferred to Yodagama, which was once an ancient village during the time when kings ruled Sri Lanka. Today, this tiny hamlet, in the Ratnapura District, attracts Sri Lankans from the south, who have settled in Yodagama under the government's agricultural colony scheme.

"Not everyone can be a farmer. Some have to be artisans and microentrepreneurs. I knew I needed to start my own business to supplement my husband's small salary," explained Pallewela.

After she decided to go into business for herself, Pallewela needed to choose what type of business. She said that choice was easy. It had to be candy. "I've always loved sweets. I especially enjoy the traditional preparations done during the festival seasons."

It proved to be the right niche; the closest candy seller was 50 miles away.

After six months of data collection, Pallewela said she decided to sell only a few kinds of candy, those that could be produced using locally available raw materials.

She now needed to purchase some equipment. Pallewela's credit union granted her request for a loan--US$100. "The credit union was there for me from the beginning, offering me both technical advice and the credit necessary to build my candy business."

Pallewela's business now draws enough profit for her to save regularly, allowing her credit union to lend to other microentrepreneurs. In fact, since first helping Pallewela, the credit union's membership has grown; nothing is more powerful than word-of-mouth endorsements.

As for Pallewela's business, she now employs six young women, all of whom have become partners, and her product is recognized as one of good quality in the market. "I own a business--something many only dream of doing. But I no longer have to dream thanks to my credit union."

The information was provided by Wansa Abayawickrama of SANASA. Bob Lestina, World Council of Credit Unions program officer, provided the pictures. Karen Kaplan, World Council of Credit Unions communications officer wrote the story.

Alemnesh Geressu from Ethiopia

Alemnesh Geressu is one member of the Women's Poverty Lending Program of CRS/Ethiopia (operated in collaboration with the local counterpart, Meki Vicariate, 110 km southeast of Addis Ababa, Ethiopia). Alemnesh lives with her husband, a poor farmer with no land, and their six children. For years, Alemnesh subsisted through petty trade, gaining a small profit, most of which she had to pay back to local money-lenders, paying around 10 percent or more per month.

Alemnesh received her first loan from CRS in 1995. She expanded her work by selling grain in the local marketplace, where she buys at a lower price from nearby farmers. In addition, she is involved in growing vegetables and plowing a plot of land, provided by the Meki Vicariate, with the other members of her solidarity group.

She says that there has been a real change in her attitude on how to tackle her financial problems and she has observed an improvement in her living condition after joining the program. "Before joining the program," she says, "I had a problem with paying back the interest to the money lender. Now, after receiving the loan from the association, I only pay the principal and interest at a commercial rate that is ten times less than I used to pay to the local money lenders." Almenesh's income has increased and she has started increasing her monthly savings. She now has enough money to buy things for her family and is sending two of her children to school. "I have now more confidence and skills in myself and I wish the program could accommodate more women to improve their lives."

Altagracia Damian from the Dominican Republic

Altagracia Damian started a tiny ceramics business in the Dominican Republic. She believes that development, whether personal or professional, is the result of human and economic resources. When she started her business in 1987, she had only 16 cents in her pocket.

After a few years of minimal operation, Altagracia went to ADEMI for a loan. She received $80 which she used to purchase clay and glazes. Since then, she has received a total of eight loans from ADEMI.

Although Altagracia herself doesn't draw a fixed salary, she now has seven employees working in her business. She says that thanks to the support of ADEMI, she has been able to climb out of extreme poverty and manage a growing business, while paying for her children's education.

Flora Matiasi from Malawi

More than one-third of the borrowers in FINCA's village banking program in Malawi are the sole supporters of their family. Flora Matiasi and her six children live in a one-room hut. In the past, Flora struggled to feed her children and their future was precarious. With the increased income from her growing business, she has been able to feed them regularly and pay their school fees.

Flora sells "mandazi" or oil cakes, a donut-like confection. With her loans from the local FINCA village bank, she has been able to buy raw materials in bulk at a better price. As a result she is able to produce, sell and earn more. So far, Flora has accumulated $540 in savings, nearly ten times the amount if her first FINCA loan. Saving is a crucial feature of the FINCA plan; village bankers' are required to save regularly, a practice which builds financial responsibility and independence. Saving enables families to plan for the future, to cover emergencies, which might otherwise sink them deeper into poverty.

Julia Sairitupac from Peru

Julia Sairitupac was born in the district of Santiago, 330 kilometers south of Lima, Peru. She was married at fourteen to a twenty-eight-year-old man. When she was eighteen, she moved to Lima with their first daughter. After her last child was born, her husband left Julia with no income. She had to leave Lima, as she could not pay the rent for the apartment where the family lived. In 1985, she moved with her children to "Sarita Colonia," a small village of 350 families, in the marginal urban zone in the south of Lima.

One of her daughters gave Julia the idea to initiate a business selling fruit juice and "salchipapas" (French fries with fried hot dogs) on the street. For several years the business was very slow because she had no capital with which to expand. In 1990 SEDES arrived in Sarita Colonia and Julia took out her first loan. Her first loans were small, between US$100 and US$200, and she was able to buy herself a liquefier, a juice extractor, and a showcase. She began to sell other delicacies and, with each loan, her business grew.

"I feel that I have begun, for the first time, to leave poverty," says Julia. "Although my work requires many sacrifices, I want to continue progressing and install my business in my own house, which, with the help of my children, we are already building bit by bit. My dream is to see it completely finished.

"Now I also have the opportunity to meet with other mothers in my community, who have chosen me as president of a mothers' club. During the mornings I give my time to the club; we already have a 'popular Dining Room' and give food to poor families at a very low price."

Anastacia Abella from the Philippines

Anastacia Abella, known in her neighborhood as Lola (grandmother) Tasya, lives in a squatters' village in Manila, The Philippines. She and her four adult children inhabit a shelter built from scrap materials. Frequent blackouts in Lola Tasya's neighborhood make kerosene lamps a necessity. Before she received her first loan of US$133 from Opportunity International, Lola Tasya spent each morning searching through garbage dumps for jars that she made into lamps.

After scrubbing them in cold water, she painted the lids, added wicks, and attached metal handles. She would then sell the few that she could make to earn a very small profit. With her loan, Lola Tasya can afford to buy clean jars from the dump. Before her first loan, she and her family made 150 lamps each day. With clean jars, they make more than 300 lamps per day, which earns them US$30 in profit. The family sells each lamp for 10 to 25 cents, depending on the size.

At age 72, after a lifetime of hard work, Lola Tasya should be enjoying a peaceful retirement. But she knows she must work each day to eat-at least Opportunity International has made that work a little easier. Lola Tasya is proud of her handiwork and her ability to earn her own way-she knows she is a survivor.

Mable Mambwe from Zambia

Mable Mambwe of Zambia has been knitting for her family of eight children since 1981. Although she thought about selling some of the garments she made, she felt guilty about spending any money on yarn - that money, she felt, should go to meet the basic needs of her family.

n Mable learned about Women Finance Trust of Zambia. She took out a small loan and purchased a second-hand knitting machine. A friend volunteered to teach her how to use it. “Since I already knew how to knit with my hands, it was not difficult for me to learn with the machine,” Mable says.

“I made a lot of garments, which were sold. From the sales I managed to pay back the

loan and was able to help my family in terms of food, medical, and school fees. We are a happy family now that our income is able to meet our daily needs.”

A friend had helped Mable pull herself out of poverty, and she wanted to help others. “After the problems I had gone through, and the assistance, I started thinking about assisting other women who had similar problems like mine. I organized a group of women who were not doing anything apart from waiting for their husband’s support and volunteered to train these women in knitting and tailoring with my own resources,” says Mable. The women are now applying for loans from Women Finance Trust to boost their businesses.

Nurajahan from Bangladesh

Nurjahan is a borrower of the Grameen Bank in Bangladesh. Her name means "the light of the world." Abandoned by her parents at three months of age and raised by a neighbor, Nurjahan was married at twelve only to be abandoned by her husband a year later, while three months pregnant. She returned to the family who had raised her, cooking for them while raising her son.

Before joining Grameen, Nurjahan had never earned more than $37.50 in a year and owned no land. After five years as a borrower with the Grameen Bank, her annual income is $250 (just above the national average) and she owns two goats, one pregnant cow, ten hens, and two-thirds of an acre of land. The land cost $1,000, more than four times the average annual income. Seasonally, she employs two farm-hands to assist with her rice crop. In a country where only 46 percent of the children reach grade five, Nurjahan's son is now in 8th grade.

Katakana Strzelinska from Poland

Katakana Strzelinska is 24 and lives in a working-class district in Lodz, the traditional textile center of Poland. Many factories have closed, leaving many people unemployed, especially women skilled in sewing. During her school days Katarzyna used to work alongside her mother as a quality controller in a company that made tights. Later she discovered that it was possible to make tights at home out of rejects from Western European factories.

In April 1995 Katarzyna set up her own company with 500zl (US$180) as capital. With this money she bought reject goods to rework. Her mother, grandmother, and aunt all helped with the work. "I had no chance of getting a loan from a bank," said Katarzyna. "From their point of view, I had nothing to guarantee any loans with. We worked day and night, but we had no chance of any further money to invest in the business for future growth. I found out about Fundusz Mikro from a girlfriend who runs a small shop and had got a loan from them. I decided to try for one too."

With her first loan of 2,000zl (US$700), she bought raw materials and a secondhand overlook machine to make tights. "My production increased by a factor of two or three," says Katarzyna. "We produced cheap nylon tights and more expensive ones with lycra and satin. I started to sell to a couple of shops, as well as market stalls. The loan gave me peace of mind because, even if someone had lent me a large sum of money, I would have had to give it all back in one payment. The monthly installments let me plan for my future bills and stocks. I feel so much more secure."

La Mamn Mole Motuke from Zaire

La Maman Mole Motuke lived in a wrecked car in a suburb of Kinshasa, Zaire with her four children. If she could find something to eat, she would feed two of her children; the next time she found something to eat, her other two children would eat.

When organizers from the Association interviewed her, she said that she knew how to make chikwangue (maniac paste), and she only needed a few dollars to start production. After six months of training in marketing and production techniques, Maman Motuke got her first loan of US$100, and bought production materials.

Today, Maman Motuke and her family no longer live in a broken down car; they rent a house with two bedrooms and a living room. Her four children go to school on a regular basis; they eat regularly and dress well. She currently is saving to buy some land in a suburb farther outside of the city and hopes to build a house.

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