HNB is engaged proactively in every segment of the society to develop this country - Chandula

Foreign employment is an important and stable source of foreign currency inflow to Sri Lanka. Last year, the total foreign remittances received from migrant workers increased by 25 per cent to US$5,145 million compared to US$4,116 reported in 2010. According to Sri Lanka Bureau of Foreign Employment (SLBFE), the total number of departures for foreign employment stood at 262,960. Although migrant workers play an important role by positively contributing to the GDP, this particular sector remains stagnant and underdeveloped in many aspects including the welfare, effective use of funds remitted to Sri Lanka, and wealth creation. Another facet of this is the unemployment, which has come down to 4.2 per cent in 2011 from 4.9 per cent in 2010. The total number of unemployed is estimated at 342,000 by the Government. Following are the excerpts of an interview held with Hatton National Bank PLC Deputy General Manager - Development Banking Chandula P. Abeywickrema on the two significant products launched to address the lacuna in effective fund management for migrant workers as well as to curb the youth unemployment in Sri Lanka. (Intro)

What made HNB to focus on migrant workers and manage their remittances?

Chandula - HNB is engaged proactively in every segment of the society to develop this country. In our efforts, a key segment identified is the migrant workers with a considerably high potential. This year migrant worker remittances are expected to reach US$6 billion; significant foreign exchange earnings for Sri Lanka. I think nearly 10 per cent of our population is serving in other parts of the world as migrant workers - 55 per cent female and 45 per cent are male.

Regardless the support this sector gives to the economic vibrancy of Sri Lanka, what HNB found them marginalized despite various programsin place to eradicate issues related to effective use of their remittances and welfare. Other aspect is that most of those who go for foreign employment are from the rural, who feels they are isolated or with less opportunities with their current level of income. These are the people in the bottom end of the pyramid. This could be one reason that they repeatedly go for foreign employment.What HNB introduced gives them access to the banking and financial services in a prudent way rather than making use of the bank to collect remittances. It is important for the migrant workers as well as their dependents to benefit from this new program-Adhistana. At the moment the dependents use the income remitted entirely for consumption rather keeping some part of it for future requirements or family development.

In Adhistana account scheme what do you offer to change the current scenario?

Chandula - The pragmatic solution we introduce will engage them in financial services. They have dreams and hope to achieve tangibility. What we do is help them in asset creation that can be started with very negligible amounts of money. So, we have started awareness programme to educatethe earners as well as the dependents. The first task in Adhistana is to make the target group start creating assets through regular savings programme. This prevents dependents from consuming all what was sent to Sri Lanka. Adding more to this we have started giving them financial literacy. This teaches them the effective use of financial services and affordability. We engage them in a programme to help them full fill the dream or the targets. So, we have embarked on a venture enabling the dependents to generate an additional income by linking them to a livelihood development option. This is what is known as a micro entrepreneurship programme.

What sort of a financial assistance do you offer the sector?

Chandula - If they have saved some money to which we will extend the Micro-entrepreneur loans enabling them to start a venture. This could be a small boutique, a tailoring/ dress making shop, agriculture, or any other cottage industry. This supplement the revenue generated abroad. At the end of the term when the migrant worker returns to Sri Lanka, the additional income generation could help meet the days-end or take to the next level joining their resources. Today, particularly women play a major role in this sustaining families and revenue generation. They have to be empowered with financial education. The idea behind all this is to create assets for them. We also support them with housing loans as well as education loans. This is the first time a national bank comes forward to help this sector recognizing their support to the country. This gives them respect in the financial services.There are lots of social issues involved in foreign employment. Our solutions will help to eradicate many of these social issues including eradicating abuse of money remitted to Sri Lanka.

Apart from Adhistana launched for migrant workers, what made HNB to consider youth employment?

Chandula- Sri Lanka could be the only country that faced youth uprising several times. The first youth uprising took place in 1971 leading to 30,000 or more deaths. Secondly, the next round came up in 1988 where they tried to topple the government, which has failed. This time the dam- age was greater where the whole economy came to a standstill with a chit coming with orders. The death toll could have exceeded 70,000. Adding more to the recently concluded war, more young people died from both sides. Few months back almost 200,000 young people applied to go to South Korea for employment, applied for 10,000 Korean jobs that was available and nearly 20,000 people came to Colombo and waited for two days just to collect applications. Some of the reasons are non-awareness of the opportunities available and non-availability of opportunities within the country in different other areas and significant youth under employment.

A key blessing the country has is the free education and free health care.Unfortunately this free education drives youth towards white collar jobs. As a result of this there are large numbers who fails to enter the universities but stagnant in life. In other countries there are no big difference between white collar jobs and the blue collar jobs. This is an issue about the dignity. So, young people feel that they don't have access to economic development.

What is the product introduced to help generate employment?

Chandula - There is lot of potential for good technical people that range from masons to mechanics. Getting along these lines, they could grow to be a contractor. This country needs plumbers, masons, carpenters, mechanics, and farmers. I will give you a classic example. There are 400 - 500 harvester machines in Sri Lanka mostly in the East and South of Sri Lanka. These machines are operated by Indians who receives Rs. 200,000/- per month. So, why can't our people get this extra money to retain in Sri Lanka?

So, HNB realized the importance to empower youth and introduced Yauwanabhimana scheme, firstly to make initiatives through our Branch network to reach out to the young people, create awareness of the opportunities available in the various fields such as agriculture, construction with opportunities for professional Plumbers, Masons, Motor Mechanic industry, hospitality industry and create awareness of the heights the young people can reach in these areas of professions. Towards this we have partnered with Hayleys and CIC for agriculture, Holcim for construction, DIMO for motor Mechanics, Aitken Spence for hospitality industry, British Council and University of Colombo. The whole programme revolves around making young people employable either through employment opportunities in various fields or self employment opportunities through micro- entrepreneurship opportunities.