Micro-credit helping check rural poverty

from Gorkhapatra

By A Staff Reporter

Kathmandu, Jan. 2: Menuka Khatiwada, a resident of Mulpani VDC-4 of Kathmandu district wakes up early in the morning and utilises her time in milking cows. She now is the owner of five cows. Khatiwada says that she sells 25 litres of milk daily at Rs.10 to 15 per litre and generates a handsome income.

She said that she and her husband were able to keep a family of seven solely by selling milk. Her four children study at the private boarding school. �Three years before I was idle and my precious time was going waste, but now I have got the meaning and value of myself apart from being engaged in serving the household I found myself a complete independent woman," she added.

She further said that Centre for Self-help Development (CSD) a national level non-profit and non governmental organisation working towards poverty reduction and empowerment of women has supported her with the first loan of Rs. 10,000 as she acquired the membership of CSD's to buy a cow. �I have no difficulties to pay the two weekly loan installments as I have asked for an additional loan of Rs. 20,000 to buy more cows," she added.

Anjana Thapa, 30, of the same VDC said that she was running cosmetic shop after she received Rs. 28,000 loan from CSD, �I make roughly Rs. 300 to 400 during festivals and have been depositing Rs. 200 at a finance company. Besides I also pay two weekly loan installments," she said.

Similarly, Champa Chaudhary, a resident of Tarigaun VDC-1 of Dang district owned no land and worked as a tenant farmer. She is married with four children and was toiling hard to eke out a living with her meager earnings.

As she knew about the service and expertise of CSD, she immediately joined the eleven day long pre-group training of CSD and borrowed Rs. 3,000 from the branch and purchased a buffalo calf. After a year she sold the calf at Rs. 8,000 and again took a second loan of Rs. 6,000 and purchased a pair of bullock. After the third loan she started a grocery shop and finally she burrowed Rs. 23,000 loan with a pay back period of seven years and invested in the grocery shop. The profit of the shop is now about Rs. 400 per day and she has more than one lakhs worth of grocery stock.

More than 45 women at Mulpani have been able to find their own means of income generation and being independent through the Micro-credit strategy which has aimed at fostering self-sustained development of the poor through the enhancement of capabilities of the people at the grassroots level.

A total of Rs 2.21 billion has been disbursed in the form of micro credit to women belonging to impoverished families in different parts of Nepal in the past eight years, Rural Micro-finance Development Centre (RMDC) states.

The CSD, a national level non-profit and non governmental organisation working towards poverty reduction and empowerment of women with 60 other financial institutions on micro credit schemes have disbursed the said amount with those in the micro credit movement claiming that the trend of disbursement has been growing over the years.

Altogether 550,000 women of poor families and about 900,000 poor families have access to micro-finance from different micro-finance institutions across the country, according to the RMDC statement.

Mukunda Bahadur Bista, executive director of CSD said that targeting the poor, lending loans at their doorsteps, bi-weekly repayment schedule are the basic programme of micro-finance institutions with cent percent loan recovery rate which is worth emulating by the commercial banks that generally take poor as not credit-worthy.

More than 60 districts across the country, micro-credit concept carried by different co-operatives and micro-finance development banks has been working as a goal directed agency in enhancing the economic status of the poor, especially empowering women and building social capital as well.

According to a report released by micro-credit Summit Campaign, an initiative of Results Educational Fund micro loans to the poor around the world soared to 133 million people last year, up from 13 million just nine years ago and the loans for the poor living on less than a US$1 a day has reached 93 million families in the year 2006.

Micro-credit is one of the most powerful tools to alleviate global poverty, which builds self-sufficiency to the poor providing financial services basically working to enhance dignity and empowerment to the poor. Besides, it also plays a contributory role in development works to promote health, nutrition, housing and education has find an outstanding and reliable threshold to ensure 100 million families rise above the US$1 a day.

Moreover, it has aimed to reach 175 million of the world's poorest families with loans and credits for self-employment and financial services within 2015, the micro-credit summit campaign report states.