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Microfinance Institutions Reaching 3.8 Million Clients in India with Health Protection Services

New Delhi, India (June 28, 2012) - On June 28, Freedom from Hunger, the Microcredit Summit Campaign, and the Indian Institute of Public Health, Gandhinagar released a new report titled Integrated Health and Microfinance in India: Harnessing the Strengths of Two Sectors to Improve Health and Alleviate Poverty.

The report demonstrates how microfinance can be further leveraged to provide a powerful tool to address one of India's persistent barriers to the economic advancement of the poor: ill health caused by lack of access to health services.

Indian microfinance institutions (MFIs) currently serve 71 million rural poor. Pairing financial services with access to life-saving health interventions, such as health financing, telemedicine, and other innovations, has tremendous potential but requires further commitment of effort and resources to reach scale.
Surveys of the sector in India conducted in 2009 show that of 134 MFIs in India, approximately 25% provide some type of health services to clients. The report also presents the findings from a more recent study of the same MFIs, outlining the range and frequency of the different health needs being addressed and the type of interventions provided to their clients. This new data shows that, together, these MFIs are reaching some 3.8 million clients with health protection services with the potential to reach many more.

This is welcome news against the backdrop of the last two years of political turmoil surrounding microfinance in India. The image of microfinance has suffered considerable damage and the sector has seen a profound political backlash, the result of over-indebtedness resulting from high-growth microfinance run amok.

The report and recent quantitative studies show that combining microfinance with health programs results in "significant impacts" on maternal and child health as well contributing to the financial performance of MFIs. Studies funded by The Bill & Melinda Gates Foundation in 2011 indicate that, on average, it cost microfinance organizations $1.59 per client per year to provide health protection products.

The report is part of an ongoing Health and Microfinance Alliance effort to promote dialogue and encourage further exploration of and support for multi-sectoral approaches that integrate microfinance and health. Research indicates that this low-cost, sustainable strategy shows tremendous potential for improving both the health and financial status of India's poor and marginalized populations.

India's poor suffer a disproportionate burden of heath care expenditures. An estimated 35 million Indians are growing more deeply impoverished each year because of out-of-pocket medical expenses. They are often just one illness away from losing everything, and for microfinance clients, sickness is often the main reason underlying failures to repay loans and the collapse of promising micro-businesses.

As Ela Bhatt, founder of Self-Employed Women's Association (SEWA), explained, "For microfinance to achieve its objective of providing financial security to the poor, it has to address health security as a crucial element of social security. They are, indeed, two sides of the same coin."

"It's encouraging to be reading news again of microfinance organizations in India making a difference in the lives of their poorest and most vulnerable clients," Microcredit Summit Campaign Director, Larry Reed said. "We see integration of health and microfinance as making a significant contribution to the Campaign's second goal of helping lift 100 million families out of extreme poverty."

Freedom from Hunger President, Steve Hollingworth noted, "We are proud of our long-standing collaboration with the Microcredit Summit Campaign. Our shared vision is to cultivate and nurture communities of practice that support the global expansion of an integrated, multi-sectoral approach, to integrate microfinance with health protection. This will create a substantive shift in the way that the community of practitioners, thought leaders, policymakers, and funders approach public health and poverty alleviation for the world's hungry."
A significant proportion of the resources to support the work and expansion of the Alliance are being provided through a grant from Johnson & Johnson, which has been a long-time champion of integrated microfinance and health protection services.

Commenting on the Alliance's work, Johnson & Johnson Corporate Contributions Director, Joy Marini added, "I commend the Microcredit Summit Campaign and Freedom from Hunger for their innovative thinking. Their model of collaborating with local microfinance institutions to reach small communities in India is already showing positive results."


Freedom from Hunger:
Freedom from Hunger is an international development organization that brings innovative and sustainable self-help solutions to the fight against chronic hunger and poverty. By partnering with local microfinance institutions (MFIs) and nongovernmental organizations (NGOs) in Asia, Africa and Latin America, Freedom from Hunger is reaching 4.4 million women in 2012, equipping them and their families with resources they need to build futures of health, hope and dignity.

Microcredit Summit Campaign:
The Microcredit Summit Campaign (the "Campaign"), a project of RESULTS Educational Fund, is the largest global network of institutions and individuals involved in microfinance. The Campaign convenes microcredit practitioners, advocates, educational institutions, donor agencies, international financial institutions, NGOs, and others involved with microcredit to promote best practices in the field, to stimulate the interchanging of knowledge, and to work towards alleviating world poverty through microfinance. The Campaign is committed to achieving two goals by 2015 (1) reaching 175 million poorest families with microfinance and (2) helping lift 100 million families out of extreme poverty. The integration of microfinance and health integration is a core strategy to the achievement of goal 2.

Indian Institute of Public Health, Gandhinagar:
The Indian Institute of Public Health, Gandhinagar (IIPH-G) is part of a network of four Indian Institutes of Public Health, affiliated with the Public Health Foundation of India. IIPH-G's mandate is to address the shortage of trained and qualified human resources in public health and to contribute to the building of strong public health system across the length and breadth of India. To do this, IIPH-G educates and nurtures human resources by providing quality training to graduates from different disciplines in various public health domains, thus contributing to overall national health goals for India. The full-time IIPH-G faculty offer a world-class academic program that incorporates the latest advances in public health. Faculty are active in a range of research in areas of maternal and child health, disease surveillance, nutrition, micro-finance, monitoring health programs and advocacy, and health due to climate change. Research and academic partners include Karolinska Institute Sweden, Aberdeen University (UK), Boston University (USA), and Columbia University (USA).

For further information:
Microcredit Summit Campaign
Sabina Rogers | +1.202.637.9600

Freedom from Hunger
Ethan Veneklasen | +1.530.758.6200 x 1018

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