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Discussion of Commissioned Paper:
Building Better Lives: Sustainable Integration of Microfinance and
Education in Child Survival, Reproductive Health and HIV/AIDS Prevention
for the Poorest Entrepreneurs
Chairperson: Dr. Jaime
Aristotle B. Alip, Managing Director, CARD Bank, Philippines
Panelists:
* Mr. Christopher Dunford, President, Freedom for Hunger, USA
* Mr. Abdul-Muyeed Chowdhury, Executive Director, BRAC, Bangladesh
* Ms. Jaya Arunachalam, President, Working Women’s Forum (WWF),
India
* Ms. Dolores M. Torres, President and Chief Executive, CARD Bank,
Philippines
Mr. Christopher Dunford, President,
Freedom for Hunger, USA
Mr. Christopher Dunford said that the very poor need more than microfinance
to address the causes and conditions of their poverty. A “coordinated
combination” of appropriate development services is needed
to improve their business, income and assets, health, nutrition,
family planning, education of children, social support network,
etc. Most microfinance institutions do not attempt to meet the non-financial
needs of their clients, though they acknowledge the importance.
Mr. Dunford argued that a variety of education topics could be covered
effectively in the group-based microfinance delivery approach at
a low cost. There is a critical need for innovative integration
of microfinance with the promotion of family planning and HIV/AIDS
prevention.
He explained about two different types of integration strategy (parallel
and unified), along with their advantages and disadvantages. He
also provided some successful examples of integration of microfinance
with education without compromising the sustainability of microfinance
and overall operation performance. In parallel service delivery
approach, the services are extended to the same groups of clients
by different staff of the same organization. BRAC in Bangladesh
and PRO MUJER in Bolivia are pioneers in this regard. In unified
service delivery approach, the services are delivered to the same
clients by the same staff. FUCEC-Togo, FOCCAS Uganda and CRECER
in Bolivia are practising this model. The overall cost is reasonably
less and they have achieved or are likely to achieve full recovery
of their operating and financial costs in the near future. Mr. Dunford
drew attention to the advantages - the potential range of services
for parallel delivery and potential financial sustainability for
unified delivery; as well as to the disadvantages – the financing
and coordination challenges for parallel delivery and the management
and staffing challenges for unified delivery. He concluded by saying
that ‘strong will’ is a must for any integration initiative.
Mr. Abdul-Muyeed
Chowdhury, Executive Director, BRAC, Bangladesh
Mr. Abdul-Muyeed Chowdhury praised Mr. Dunford for his nice presentation.
He said that microcredit is an efficient way to attack poverty.
The root cause of poverty is income poverty which leads to ill health,
illiteracy and forfeiture of various rights and access to services.
Microcredit helps the clients to go into non-farm and off-farm activities.
Increasing income and productivity of the poor people is central
to building sustainable livelihoods and to improve the quality of
their lives. In his opinion, microfinance plays a pivotal role in
the implementation of the holistic approach by mobilization of the
poor and creating a relationship of trust and confidence with the
MFI. This makes it easier for the MFI to create awareness about
rights, health and hygiene and other relevant issues. BRAC’s
experience in poverty alleviation work for more than three decades
has shown that the microfinance network is a solid institutional
capital for holistic poverty alleviation efforts.
Mr. Chowdhury said that the microfinance groups could be used to
integrate financial services with all other services, which is needed
for creating a better life for the poor. However, neither the organizations
own resource nor the donor’s fund is sufficient for this.
As a result, services of government and other operators have to
be availed of by the people. He opined that the integration of services
at management level is feasible but at the field level different
expertise and skills are required for microfinance and health or
education service. He strongly argued on the importance of integration
of microfinance with other services and hoped that through this
the existing situation of child survival, reproductive health and
HIV/AIDS prevention amongst the poorest entrepreneurs can be improved.
Referring to BRAC’s learning, he suggested that different
personnel of the same organization serve the same clients in a better
way rather than other options of integration.
Ms. Jaya Arunachalam, President, Working
Women’s Forum (WWF), India
Ms. Jaya Arunachalam briefly presented the organization history
of WWF, which emerged in 1978 as a social movement favoring the
poor women. WWF tried to demonstrate the valuable economic role
of poor women through microcredit and emphasized on employment generation.
There are more than 1,12,000 groups, covering 7,16,000 women in
the 15 branches of 3 southern states of India and they have provided
microcredit to 3,65,000 members of 3,415 villages and 2,075 slums.
Ms. Arunachalam thinks that access to microcredit towards occupational
facilitation, integrating the same with other aspects such as skill
training, healthcare becomes appropriate. WWF has adapted cadre
based approach and covered nearly 16,00,000 families accomplishing
72% couple protection rate in the poorest communities, providing
employment to 960 grassroots health cadres spread out to 720 slums
and 340 villages. As the women are the easily susceptible victims
and because of lack of decision-making power in sexual matters,
they are pushed into HIV/AIDS by rape and induced sex. Ms. Arunachalam
spoke about WWF’s integration initiatives to link reproductive
healthcare in addition to microfinance, which has involved the HIV
infected population with some income generating activities. They
are giving emphasis on both the prevention and rehabilitation aspects
of HIV. There is an urgent need to invest in childcare centers,
adoption centers and schooling for the AIDS orphans or the children
of the affected parents. She gave an example of the Devadasis community
of the Bellary district of Karnataka that has become victimized
due to the degenerating cultural practices leading to female child
prostitution on a common ground. WWF has provided them with microfinance
services and healthcare required for prevention and rehabilitation
of HIV/AIDS. Ms. Arunachalam was of the opinion that microfinance
service providing organization could play an advocacy role to influence
the government’s policy in favor of the victimized poor.
Ms. Dolores M. Torres, President and
Chief Executive, CARD Bank, Philippines
Ms. Dolores M. Torres agreed with the other panelists that integration
of microfinance with education is very useful. She stressed the
need to find out the appropriate strategy of integration. CARD promotes
home-based education or awareness services. Ms. Torres suggested
that besides regular microcredit activities, other necessary orientations
such as group building, bookkeeping, accounting and awareness of
health, family planning, business knowledge could be transferred
in the group meeting. The service delivery costs are included in
the overhead cost of microcredit operations. Ms. Torres quoted a
benefited woman’s reaction where she acknowledged the learning
and expressed her optimism that her children will be able to practice
those in their lives.
Open Discussion
In the open discussion, the participants raised a number of important
issues which can be summarized as below:
* Generally, funds for providing special services come from limited
percentage of own resource and donors support. Besides, own source
of funding, the microfinance institutions need additional funding
for integrating other services with microcredit.
* Integration is a real challenge for the small NGOs due to inadequate
management capacity and funding problem.
* There is a need for coordination among the microfinance service
and other support services. The support services providers need
to ensure high quality for acceptance by the clients.
Summing up by the Chairperson
Dr. Jaime Aristotle B. Alip, the Chairperson of the Session, thanked
the panelists and the audience for their valuable insights and lively
participation. The Chairperson suggested for being open to all integration
strategies as success depends on the definite contextual demand
and opportunities.
Her Majesty Queen Sofia of Spain visiting
Exhibition Stalls
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