Banks need to focus to rural places
Although the microfinancial institution plays a major role in reaching out to the rural places, for the low income groups, but due to scares and low population density, the cost for the operation is very high. But this shouldn’t deter the agencies in carrying out their work.
One of the microfinancial institutions in Bhutan, RENEW (Respect, Educate, Nurture and Empower Women) started micro financing in 2011 in partnership with Saving Banks Foundation for International Corporation, Germany. And it is growing strong despite numerous challenges. Other micro-financing agencies should learn from RENEW and help our vulnerable communities.
The micro-financial project strengthens the micro financial sector and ensures economic stability for poor and disadvantaged sections of the society.
RENEW, a civil society organization, which looks after vulnerable section of the society, started micro financing project, first, in Samtse in 2012. Later they had opened branches other dzongkhags and finally in Punakha.
Besides lots of challenges, RENEW today and a number of success stories to share. Bhutan is a mountainous country, where geography is one of the challenges, the other being scattered settlements. Good road connectivity to these communities will help such agencies in delivering their services in time of need.
Today field officers of RENEW walk or drive through rickety roads for hours to reach to their beneficiaries, which results in waste of productive work-hours.
We talk about corporate social responsibilities, but except for few commercials banks donating money to urban school and sponsoring reality shows, we don’t see them getting into the rural Bhutan. The commercial bank shouldn’t only look for profit but should support microfinancial institutions with viable model.
Bhutan can follow Nepal model in reaching out to the rural populace, as the two countries share the same geographical topography. However to sustain the operation the banks shouldn’t charge high interest rates.
RENEW’s microfinancial institution project strive to improve the living standard of the women and their families, especially those living under extreme circumstances. Other should join hands to end poverty in our rural pockets.
The RENEW microfinance project consist of micro loans, saving opportunities, credit facilities and insurance facilities. Assistance is also rendering to vulnerable women to become economically sustainable and independent women.
Meanwhile, RENEW micro-finance provides business loan, agriculture loan, multipurpose loan, emergency loan and also encourage their clients to have compulsory and voluntary saving. The loans do not require any mortgage. Currently RENEW provide loans to 1628 clients.
Our commercials banks have to play an important role in reaching nook and corner of the country with a mandate to serve the people. There must be a change in the focus of the banking system and make agriculture their priority as more than 70 percent of the Bhutanese population depend their livelihood it.