Country Profile

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Bangladesh

Population:

156,050,883

Capital

Dhaka

Major Rel.:

Mostly Muslim, some HIndu & other

Main Lang.:

Bangla (official, also known as Bengali), English

Country: BANGLADESH

Project Title: Rajshahi Microfinance (Final Report

Project Designation:  1101

The Need:

WRC applies the following five principles to each microfinance program we support:

1. Deep Outreach: WRC seeks to reach the very poor, particularly women, by targeting them with tailored services.

2. Client Focus: We approach every microfinance program by listening to clients, fine tuning our programs through market research/impact assessments, providing good customer service, and adapting and adding services that clients want.

3. Large Scale: WRC seeks to grow its microfinance programs to serve many people through continual program expansion, simplifying operations to lower costs and increase productivity, reducing client dropout, and developing program support capacity such as staff training and business planning.

4. Sustainability: We ensure on-going financial services to people in need by simplifying and standardizing operations and promoting client retention.

5. Culture of Innovation: While using microfinance preferred practices, our programs are customized to achieve the best results. We regularly review programs and make changes to help the people we serve.

WRC’s Response:

WRC’s microfinance programs target the very poor (frequently women with families to support) with financial services to improve their living standards. A typical microfinance program involves the staff of a local WRC partner assisting groups of 20 to 30 poor people in a community to elect group leaders, develop financial by-laws, and learn to manage their own financial transactions.

Once the village group is in place, regular weekly, biweekly, or monthly meetings are held where the group of “bank” disburses loans, collects loan and savings payments, records financial transactions, and receives training on various health and economic issues. Initial loans are very small in size ($25-$135) and increase over time. Loan terms vary from 4 to 12 months with small repayment amounts at the regular group meetings.

The key to our microfinance programs is that they are provided in simple, cost-effective ways that eliminate the need for extensive documentation and collateral for loan guarantees. If you’ve ever applied for a loan at your local bank, you know how many hurdles you have to overcome to get a loan. Think how impossible it is for very poor individuals to overcome such obstacles.

Instead of collateral, the group members guarantee each others loans and desire for future loans are incentives for repayment. The goal of every WRC microfinance program is self-sufficiency.

WHAT WRC HAS ACCOMPLISHED:

Start Date:  April 2007  End Date:  March 2010

During the past year, World Relief Canada supporters have contributed generously to our microfinance program in Bangladesh. Together with our local partners in that South Asian nation, we’ve:

 • Active Clients (100% women) have increased from 12,000 to 19,356.

• 19,356 clients have increased awareness and skills on credit management, business practices, and various social topics as well as applied micro-loans to their businesses.

• 4,539 women’s leaders have increased awareness of group and financial management skills.

• Arranged to increase KOINONIA Microfinance Financial Institution capacity:

- WRC conducted technical consultancy to review Business Plan/Microfin projections for 2008-2012.

- WRC funded Microsave consultant to provide field-based market research training for KMFI staff.

- 4 management staff given additional training on group, project and financial management.

- 18 unit officers and 2 regional managers trained in financial management and ratio analysis.

- 129 loan officers trained in group formation and management

- 20 support staff trained in accounting, financial analysis, monitoring and supervision.

- Report writing training provided for 3 HQ staff.

*See our new microfinance project in Bangladesh - KOINONIA #826.  Start Date: April 2010

Beneficiary Story: