A replicated model of group lending
PADMINI SWAMINATHAN
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A comparative study of Grameen Bank and Kashf Foundation, a micro-credit institution in Pakistan
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REPLICATING DREAMS: Nabiha Syed; Oxford University Press, YMCA Library Building, Jai Singh Road, New Delhi-110001. Rs. 350.
The book begins on a very promising note by mapping the contours and elements of what constitutes the famed Grameen Solidarity Group Lending Model and its adaptation by Pakistan’s Kashf Foundation. Following the Grameen model, Kashf requires five women to form a peer group in order to obtain a loan. These groups are entirely self-selected, as in the Grameen system, and all five women must live in close proximity to one another and must not be blood relations.
Deviation
In a notable deviation from the Grameen example, all Kashf borrowers must be married. “The rationale is that unmarried women are prone to moving out of a geographical location after marriage, and moving implicitly indicates loan default.” But, as the author notes, the exclusion of unmarried women means denial of opportunity for single women to build up enough capital and acquire self-sufficiency that could give them a certain amount of economic bargaining power while entering into a marriage contract.
Further, given the conditions within which a bulk of the women in Pakistan have to function, Kashf specifically permits women to obtain loans on behalf of their husbands. “This approach was designed to overcome possible objections to the economic activities and advancement of potential participants.” A little later, the author explicates this point in a different way: “… a chauvinistic society will not tolerate a programme promoting financial independence of women on any other terms but its own.”
Kashf claims that in allowing women to borrow on behalf of men the entire family unit is enabled to get strengthened because the process entails joint family decision-making. Moreover, and this is a striking observation, micro-credit programmes require significant time commitments on a weekly basis and that, in turn, impinge on time that can be accorded to household labour. If the ‘double-bottom’ line of micro-credit, namely women’s empowerment and financial advancement, is to be ensured then, according to Kashf, men need to be included in the process to allay apprehensions of female takeover of hitherto male-dominated space.
Feudal control
Kashf’s own internal audit of its lending programme in 2001 revealed high attrition rates,with much of the attrition resulting from “client expulsion for poor performance rather than from them opting to leave”. An examination of the reasons for differential performance of the programme in Bangladesh and Pakistan brought out, among other things, the fact that institutional differences accounted for much of the disparity in success levels. For example, the author notes, the areas in which Kashf operates are still heavily under feudal control, which militates against any attempt (such as individual entrepreneurship or financial independence) that is even remotely perceived as a threat to its system of organised subordination and hierarchy. “The entry of an institution which encourages individual economic growth, self-empowerment and self-employment and at the same time denies landlords income derived from informal credit offerings would obviously not be welcomed by the feudals.”
Parameters
Among the other institutional parameters used for comparing the difference in approach and operation between Grameen and Kashf are: styles of organisation; product diversity; differential interest rates; and approach to and scope for gender training programmes, savings programmes, etc. Notwithstanding the interesting details provided on each of these parameters, there is very little engagement with the crucial question of how far the replication of the Grameen model (but adapted to Pakistan’s environment) has enabled the actualisation of the ‘double-bottom’ line of micro-credit, namely financial and social empowerment.
Chapters 7 to 9 are in the nature of lectures, at times very elementary, on empowerment. They do make for interesting reading but leave one clueless as to their relevance, since none of them is organically linked to the earlier theme of understanding the functioning of the replicated Grameen model of group lending.
To conclude, nobody will quarrel with the statement that “empowerment can only be meaningful if it speaks to the specificities of women’s preferences and life circumstances” or that “the definition of empowerment is to be determined by the communities and individuals who seek it: it must not be top-down, dictated outcome.”
The intriguing question that emanates is the following: why are readers subjected to this discourse if, at the end, the author has no intention of engaging with the question of how she would rate Kashf’s programme in terms of this definition of empowerment?
Similarly, the discussions on ‘Trust’ and ‘Marketing’, hang in the air, with no attempt to root them to the ground and the context with which the book so promisingly began.
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