Malcolm in Bangladesh - Day 4

September 25

As mentioned, today we took a bus tour through the city to a local Credit Union but before we went there, we stopped for a presentation at ASA (pronounced Asha), Bangladesh’s largest Micro Finance Institution (MFI). The name is not as familiar as the other major MFI (Grameen Bank, whose founder Muhammad Yunus won the 2006 Nobel Peace prize) but the organization is very similar in its mission to help lift people out of poverty by encouraging savings and offering small self-help loans. There we heard their founder talk about the organization and the work that they are doing. They have over 3,330 branches and over seven million members accessing their services which include savings, and a variety of lending products classified as Small Loans, Small Business Loans, Small Entrepreneur Loans, Hardcore Poor Loans, Education Loans, Short Term Loans, Rehabilitation Loans, IT Loans and Agribusiness Loans. They also provide health assistance, and insurance solutions and they run a well respected University that grants degrees, including an LLB and MBA.

The presentation was very interesting and the work that they are doing is certainly having a positive impact for some, but my thoughts are mixed on whether Micro Credit, is a realistic long term strategy to solve the poverty problem. One participant asked an excellent question that ASA, was unable to provide a good answer to…”with all of the MFI’s offering services in the area aren’t many people simply borrowing from one to pay the other”. ASA’s answer was simply yes, in some cases. To me it sounded a lot like people at home using credit cards to pay for other credit cards, and this is certainly not an effective way to reduce poverty. The intention is good and it is helping millions, but I don’t think that it is the right solutions for everyone. But until a better solution emerges it is a step in the right direction.

From there, we fought our way through Dhaka’s traffic to visit the Buddhist Co-operative Credit Union, that serves 1515 members. This tiny one room Credit Union welcomed us warmly with song, food and drinks and they showed us their basic operations and gave us statistical overview of the organization that has been in business since 1990. Today, they have roughly $300,000 (in Canadian dollars) in assets and notably almost $25,000 of that is in children’s savings accounts. They also have 8 of 12 board member who are under the age of 35, so they seem to be doing a good job of reaching the next generation of members and leaders and they should be well positioned to survive and thrive into the future.

Overall a very interesting day, although I have to admit that I was at times overwhelmed by the sights, sounds, smells and heat of the city.

Tomorrow, I’ll spend the day in conference sessions in the comfort of the hotel’s air conditioning.