NGO monitored savings groups bail out Bangladesh's poor

Two years ago Azimon of Maunabazar village was close to the bottom of the poverty ladder in rural Bangladesh. Her family has a tiny plot of land but it was not enough to feed four growing children.

They lived a hand-to-mouth existence on money borrowed from the village mahajan or moneylender. That is until Azimon set up a vo or savings and credit group with 20 other landless peasants supported by Bangladesh Rural Advancement Committee, one of Bangladesh's largest NGOs.

Armed with a small loan of 2,000 takas (roughly $50) from BRAC after she had saved sufficient money to obtain credit, she planted cauliflower in their field after the monsoon rains last year.

Last month she began harvesting the vegetable, and now estimates she has made a profit of 3,000 takas this season. The experience of securing the loan and repaying the installments without defaulting even once, has transformed Azimon. Standing in front of her mud-plastered hut, she talks with extreme confidence.

She wants to borrow 5,000 takas this year, she said, her shiny, work-tired face lighting up as she talks about the future. ''Now I have the courage.'' ''Earlier the rich used to take advantage of us,'' she added. ''Now BRAC is enabling us to improve ourselves ... We know how to work, we have two hands, we have wisdom. But earlier we didn't have the resources.''

BRAC, set up in 1972 by a chartered accountant, Fazle H Abed, as a relief organisation after Bangladesh's liberation war, has joined hands with the landless poor to help them gain control over their lives by giving them the know-how and means to acquire new livelihoods.

Its programmes have outstripped government development efforts in 61 of Bangladesh's 64 districts. BRAC estimates that over 15 million families have benefited from its activities: 25 million mulberry trees have been planted, 1.8 million people - 93 per cent of them women - received training in income generation activities, 34,000 non-formal primary schools have been set up and 25 million people covered by health care programmes.

By the end of September 1996, BRAC gave out $328 million, 85 per cent of it to women, to start micro-enterprises.

The repayment rate is a remarkable 97 per cent, and the savings of vo members - who have to put in at least 5 takas weekly into group savings funds - have swelled to $30 million.

''Savings is a mental hinge... Your planning is no longer 24 hours. Saving means you (the poor) are planning for the future,'' BRAC Chairman Abed was quoted as saying.

BRAC staff say the high repayment rate is ensured by a simple rule: a default by any member will prevent the group from borrowing. Peer pressure has ensured this rule is rarely applied.

''Repayments are timely,'' said M Tajul Islam of BRAC. '' The poor, particularly the women, have time and again proved they are credit worthy... They plan what they need and what they want to do to improve their lot.''

Parul Akhtar, a young woman with a two-year-old son, said she intends to buy a tin roof for her thatched hut in a few years time. Tin roofs are a status symbol in rural Bangladesh, a sign that the owner has arrived, and every family's ambition.

Akhtar, who joined a BRAC vo in a village near Azimon's, bought a goat with the 1,000 taka loan. ''It also gives me milk for my baby, and a livelihood independent of my husband, who is a farm worker,'' she said.

Asked what her husband thought about her joining the BRAC group where she has to interact with non-family members, she answers with a smile, ''Our husbands are supportive. I wouldn't have been here, talking to you if he wasn't.''

Rural Bangladesh is conservative, controlled by patriarchal norms. But even the mullahs or Islamic clerics have had to learn to accept the changing social structures.

Thanks to BRAC, its women members are doing things that were unthinkable in the past. With the loans being granted in the names of the female member of a family, they are learning to handle thick bundles of bank notes.

BRAC, which has grown into a corporation with over 50,000 regular and part-time employees, is not the only NGO trying to improve the livelihoods of the poor.

Proshika (a compound of the first letters of the Bangla words for training, education and development action), Asha, and hundreds of other smaller groups, funded mainly by foreign donors, are doing the same.

Their success has made the Bangladesh government and local leaders more willing to cooperate with the large NGO community.

BRAC, in fact, is now helping carry out the government's 'family planning programme' and the World Bank funded, 'Bangladesh Integrated Nutrition Project'. BRAC's 'essential health care programme' is reaching out to the community as a whole, not just vo members. So also its 'non formal primary education programme' which enrolls over 1.2 million children between 8 and 14 years.

Seven of every 10 students are girls and all are from poor families.

They are taught through activities rather than from books. So after three years in a BRAC-supported school, the children are ready to go to formal primary schools.

Asked if they would like to continue studying, a class of 33 students (the maximum number in a BRAC school) chorus a spirited, ''yes''. Asked why some of them had stopped attending the nearby primary school, a little girl puts up her hand. ''The teacher used to sleep in class,'' she said, hiding her face in her hands as the class dissolved into giggles.

The BRAC model of primary education has been such a success that it is being replicated in eastern and southern Africa.

''The interesting thing is that the programme grew out of a demand by vo members,'' said Islam, BRAC's director of public affairs. Aware that education was necessary to improve their children's future, members of the BRAC credit savings scheme asked the NGO to set up the special schools.

UNI