Women play an important role in micro-finance and also have a lot to benefit from it, but how to promote the sustainable development of the industry for women is still a challenge, according to discussions at the Asia Conference on Micro-finance and Women's Development held in Beijing from November 24 to 26.
Liu Dongwen, MF Department Director of the China Foundation for Poverty Alleviation, said that micro-finance aims to reduce poverty, and women are generally the poorest in the poverty group. In the rural areas, for example, women do not have equal access to education. However, MF provides women with the opportunity to lift themselves out of poverty.
Robert Hickson, an MF technical support specialist from Australia, explained why women are important for MF. Women are more likely to use services in a way which will promote family well-being. They are more reliable borrowers in that they tend to return anything they have borrowed, and are less likely to try to cheat. They tend to be more careful with the resources they have, using money more wisely, and are more likely to save. Moreover, they are generally supportive creatures, especially in a group, which is good for the overall morale of the poor to lift themselves out of poverty.
The MF concept first started in Bangladesh at the end of the 1960s, where MF has been very successful. The country has set aside 15 billion taka (about US$228 million) for MF, including 8 billion taka (about US$122 million) earned from interest, savings, and insurance products, and another 7 billion taka (about US$106 million) in additional funding.
Enamul Haque, the executive vice president of ASA, a leading MF institution in Bangladesh and also in the world, spoke about Bangladesh's experiences on how to sustain MF for women. His key points were:
- Fees and expenses should be well planned every year;
- On-time funding is important;
- Training for women and their husbands must be provided;
- A sound internal and external auditing and supervision system is necessary;
- A high-tech and robust information system could save time and reduce labor costs; and
- It is essential to do continual case studies and productivity analyses.
Other Asian countries have also made progress on MF for women. According to an expert from Laos, their government has adopted a set of regulations and established some projects to support MF. The Prime Minister's office of Laos approved a policy statement for the Strategies and Action Plan for the Micro-finance Sector, which is now the government's vision statement. An MF Unit was set up under the Central Bank of Laos, and the National MF Resource Center (MFRC) was established at the end of 2004.
Speaking on China's situation, Bai Chengyu, secretary general of China Association of Micro-finance Preparatory Office, said there are 110 million poor people in China who do not have the ability to take out mortgages. The MF system, which works by way of credit, is therefore extremely helpful in giving the poor access to loans.
Bai said that MF in China is still developing even after 10 years. The biggest problem is the lack of policy support. There are no laws, regulations or policies in China that promote MF. This was also mentioned at the conference by Liang Hong, director of International Cooperation Department of Ministry of Commerce.
China's MF personnel generally lack technical expertise and experience. In addition, there is a lack of investment and funding for the system, Bai said.
The China Association of Micro-finance was set up to solve these problems and to lobby the government to formulate MF related policies. However, it lacks clout because it is still only an online organization without any legal status.
Experts from Bangladesh suggested that China send inspection teams to countries such as Bangladesh, Pakistan, and the Philippines to learn from their experiences. It was also suggested that China invite MF experts to act as consultants to the development of MF in the country.
The three-day conference was jointly hosted by the Ministry of Commerce of China, the United Nations Development Program (UNDP), the United Nations Children's Fund (UNICEF), and the China International Center for Economic and Technical Exchange.
The conference ended on Saturday with a visit to the Women Development Association in Tianjin.
More than 120 delegates from 10 countries attended the conference.
(China.org.cn by Xu Lin, November 27, 2005)
