Microcredit. Speak that word and the eyes of many a development practitioner light up. Microcredit means banking the “un-bankable”. It means helping those without income generating opportunities make their own way in the world. Microcredit, specifically the practice of extending small loans with no collateral to non-traditional borrowers, is in many ways considered a cure – for poverty and for all of the social ills that go along with it.
It was actually in Bangladesh that microcredit was born. With Grameen Bank and Nobel Peace prize winner Dr. Muhammad Yunus the practice of organizing the rural poor to use small loans started in 1976 and it has since taken flight. What started with Grameen is now a global phenomenon. Not only do NGOs across Bangladesh experience success with microcredit projects, but the practice has spread to almost every corner of the world.
But while microcredit projects have long focused on empowering the marginalized (namely poor, landless women, particularly widows or divorced women without the resources to support themselves and their families) many projects have missed a key portion of the least well off in the developing world – persons with disability. Considered an embarrassment and burden, surrounded by stigma and superstitions, disabled individuals in Bangladesh and around the globe have largely been left out of the microcredit boon. And it is into this void that BERDO has stepped.
Through projects first established several years ago, BERDO now provides microcredit facilities and training to 313 groups comprised of 2,332 individuals. BERDO operates on the principle of equality of opportunity. There is positive discrimination in that disabled members are actively sought out for inclusion into the group and offered special training during their time in the group. Of this total of 2332 participants, over 500 members are disabled and some 40 groups are lead by persons with disability.
Contrary to the first notions of many (including myself), BERDO staff are quick to point out that while disabled members receive support from their fellow members, they are by no means “carried” by their groups. Disabled members, like any other loan recipients, are considered as individuals by BERDO. They are responsible for their own financial obligations and family members often offer support to help them realize their goals. As family is the cornerstone of life in Bangladesh, this is not unusual.
Also somewhat remarkable, while the overall rate of repayment stands at 99.27%, disabled group members have never failed to repay their loans in the history of BERDO’s projects. The rate of repayment from disabled participants is 100% relative to the rate of repayment from non-disabled participants which is 98.54%.
Moreover, disabled members, like all members of the groups, take on a wide variety of activities. They do not tend to do any particular activity, but are encouraged to do something that is comfortable for them. For example, Mr. Saiful Islam in Tongi knows about the fish business and has chosen to sell fish with his loan. Regardless of the activities they undertake, BERDO reports that disabled members experience the same quality of living increase as non-disabled members of the microcredit groups.
Given these successes, it is no surprise that the microcredit boom is set to continue with exponential growth. But until other institutions offering microcredit follow BERDO’s suit and take purposeful steps to include the most neglected segment of the least well off – over 400 million persons with disabilities throughout the developing world – it seems uncertain how much microcredit can really benefit those who need it most.
Posted By Caitlin Burnett
Posted Aug 11th, 2007