Professional Documents
Culture Documents
Organized By :
Held At:
Earn less than $1 / day (often less than $0.50 / day), and income very irregular
- Income usually derived from manual labour or begging;
School-aged children working manual labour jobs instead of attending classes; Severe malnutrition (i.e., access to only one meal per day); High incidence of physical handicap; Own few productive assets; Frequent migration, transient lifestyles in search of work; Landless, or own less than 1 acre of cultivable land (including homestead); Poverty is inter-generational; Highly vulnerable to natural disasters and health catastrophes
It is he who harshly repels the orphan and does not urge others to feed the
needy.
They pray but refuse to give even the smallest help to others,. Allah wishes human life to be elevated, happy, based on pure motives and
Positive measures
Indonesia Yogyakarta profit sharing with the ultra poor Aceh group system with women entrepreneurs
Bangladesh group system 20% ultra poor no charge, 60% moderate poor 7.5% service charge with any excess returned to borrowers 20% mini entrepreneurs with Islamic financing modes Pakistan individual system using Islamic financing modes
Heterogeneity
The idea of heterogeneity and exclusion from/by existing models [non deliberate, via design and logic, unassailable] have been powerful concepts to draw policy attention and create urgency for action
Microfinance discourse [poorest of the poor as landless, non agriculture, women] The hard core poor/ ultra poor [microfinance left outs, and throw outs. Not only poorer than the poor but differently so]
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Earn 0.32less 6.10*** 2.38*** Weak 2.37** base asset 0.02 1.05 1.96**
1.69* 0.53 1.36
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t-value 1.57
Informal safety nets as important as formal ones
1.03 2.77***poorest lose out The even in informal safety 2.95*** nets
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Education and housing situation of the ultra-poor What about heterogeneity among the poorest?Poorest
Education Enrolment rate of 6-15 years old boys (%) Enrolment rate of 6-15 years old girls (%) Housing Amount of homestead land owned (mean in decimal) House wall is made of tin/brick (% HHs) Value of the house living in (mean in Taka) Owns any kind of toilet (% of HHs) Have electricity connection (% of HHs) 55 65 6.15 28 21,276 70 14 2nd decile 66 71 7.23 38 28,380 81 23 t-value 4.24*** 2.24** 2.14** 4.63*** 5.90*** 5.45*** 4.68***
The education opportunity divide
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market engagement
11 7 51 6.39 66 32 27 77 28
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The bottom 10% are much worse off The poorest living in the poorest areas are particularly vulnerable.
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Graduation
Mainstream poverty alleviation interventions by and large leave out the
poorest
Safety net interventions are not designed to help the poorest graduate Design Safety nets as stimulus package: interventions combining and
sequencing safety nets and poverty alleviation instruments for graduation outcomes for a large majority of the poorest:
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Graduation Framework
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Results mixed
1. About 80% of the IGVGD beneficiaries joined BRACs regular microfinance programme 2. But only 70% continued beyond three years i.e. over 40% of the IGVGD beneficiaries fail to start the process of graduation. 3. Those who dropped had fragile socio-demographic structures the female headed households who do not having a working adult male in the household and/or suffer from chronic illness, etc
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Need to look at
Tackling the social and attitudinal constraints which reproduces a nonenabling environment for the ultra poor.
Islamic MFIs
Social Development Program
Spouse co-signs the contract dealing with women more efficient and convenient Women disseminate knowledge to children
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Main mode- murabahah or bai-muajjal. It is difficult to go out with the clients and buy the goods/assets from faraway markets IMFIs delegates someone else (and inspects later)
Alternative is to use Profit-sharing modes Problem is the moral hazard problem--No book-keeping and difficult to monitor
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Conclusion
There are strong economic reasons for establishing Islamic alternatives to poverty-focused micro financing. Traditional institutions of waqf, zakat, and qard hassan are important means of financing IMFIs
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Thank You
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