ic12 - peace & prosperity through microcredit breakout - finca
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Presentation given by Zar Wardak (FINCA) on Monday 7 May at the 2012 RI Convention in Bangkok. Session: Peace and Prosperity through Microcredit. Session Organizer: Rotarian Action Group for MicrocreditTRANSCRIPT
Peace, prosperity and microcreditFINCA Afghanistan
Zar Wardak, CEO FINCA AfghanistanRotary International Convention, May 2012
Content
• FINCA International and FINCA Afghanistan
• Poverty – the root cause of many problems
• Afghanistan – background and current situation
• Microentrepreneurs – our hope for a better future
FINCA provides small loans and other financial services to the world’s lowest-income entrepreneurs so that they can create jobs, build assets, and improve their standard of living.
“The poor stay poor, not because they’re lazy, but because they have no access to capital.” Milton Friedman, Economist and Nobel Laureate
Founded in 1985, FINCA serves over 925,000 microentrepreneurs in 21 countries
EcuadorEl SalvadorGuatemalaHaitiHondurasMexicoNicaragua
Latin America
DR CongoMalawiTanzaniaUgandaZambia
Africa
AfghanistanJordan
GME Eurasia
ArmeniaAzerbaijanGeorgiaKosovoKyrgyzstanRussiaTajikistan
+ 1 billion in loans extended in 2011 - 98% repayment rate
+ $125M in savings mobilized
Poverty is the root cause of many of the world’s problems
Poor health and epidemics
Low education levels
Children and women trafficking
Environmental degradation
Violence, conflicts and war
When individuals have the tools to lift themselves out of poverty, they have hope for the future – a prosperous and peaceful future.
When individuals have the tools to lift themselves out of poverty, they have hope for the future – a prosperous and peaceful future.
FINCA Afghanistan: founded in 2003
• Branches: Kabul, Herat, Nangarhar, Parwan, Balkh,
Pul-e-Khumri Kunar , Kunduz and Badakhshan.
• Products and services: Village bank and small
group lending. Pioneered the Islamic Murabaha credit.
Financial literacy training. Small Enterprise Loans.
FINCA Afghanistan Key Stats
Number of Clients 13,257
% Women 81%
Average Loan Size $373
Loans Outstanding $4,934,598
On-time Repayment 99.78%
Afghanistan: the Taliban years
• The Taliban rose to power after decades of war and tribal conflict,
offering the promise of security and prosperity
• This came at a hefty price: absence of democracy, strict application
of their interpretation of sharia law, prohibition and the
marginalization of women
Afghanistan: post 9/11/2001
• Since October 2001, conflict has returned to Afghanistan
• Some progress has been made in some regions, but pockets of
insecurity remain
• In provinces where it is secure, we have seen businesses flourish
and women and men embracing their freedom
Finding a better life through microfinance
• ≈ 430,000 Afghans are participating in microfinance today
• IDS surveyed Afghans participating in microfinance:
* 72% reported improvements in the economic situation
* 45% generated employment for others
* Increased access to health services – particularly for women
• UNHCR-BRAC looked at the impact on Afghan refugees returning to their country
* 94% used the loan to start a business, purchase land or equipment
* 82% have increased their incomes since taking the loan
* 60% expect it to continue to increase in the next year
Soures: MISFA, IDS, UNHCR-BRAC joint study, 2010Soures: MISFA, IDS, UNHCR-BRAC joint study, 2010
Estorai, President of the Spojmai Village Bank in Kabul
• In 1996, when the Taliban came to power, Estorai had to stop
attending school, after only four years of formal-schooling
• To support her family, she started a secret home-based beauty
parlor
• After 2001, she was finally able to conduct her business openly
• She joined a FINCA Village Bank and her business has been thriving
since
• She has been the President of her bank for
several years, and through her leadership, is
helping other women gain access to
opportunities, training and work experience.
FINCA Afghanistan is pioneering the SMART campaign
1. Appropriate product design and delivery
2. Prevention of over-indebtedness
3. Transparency
4. Responsible pricing
5. Fair and respectful treatment of clients
6. Privacy of client data
7. Mechanisms for complaint resolution
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Afghanistan: the future?
The wave of protests sweeping through the Middle East began with a microentrepreneur in Tunisia
Mohamed Bouazizi worked as a fruit & vegetable vendor. After being fined and humiliated by a local official, he set himself on fire and died.
He inspired his nation and sparked a revolution that has transformed his region.
As Afghans are empowered and equipped to create productive livelihoods for themselves, their families and their communities – they will define the face of Afghanistan in the years to come.
Thank you
مننه
ممنونم