Micro-Credit Program of Grameen Bank and Poverty Reduction: A Study on Select Borrowers (original) (raw)
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Bangladesh is one of the world's most densely populated countries with 160 million people, 49 percent of whom live below poverty line. In addition child malnutrition of 48 percent is the second highest in the world, a condition that is tied to the low social status of women in Bangladesh. After only a little over three decades as an independence country, Bangladesh has made a significant progress in reducing poverty and improving the conditions of its poor people. Micro-credit programme is playing a vital role in poverty alleviation schemes in Bangladesh and over the world. Therefore, the study was designed to investigate the impact of micro-credit of Grameen Bank in poverty alleviation of rural poor people in Bangladesh. So it adopted Triangulation approach using both qualitative and quantitative techniques. It was an 'explorative' method of research in nature. The study was conducted in two Upozillas Sylhet Sadar and South Surma under Sylhet district covering two branches of Grameen bank. The target population was those women who had availed microcredit facilities from Grameen Bank. The sampling unit was a woman who had availed microcredit. A total of 90 respondents (60 from 547Active Borrowers and 30 from 154 Drop-out Borrowers) were selected through Systematic Quasi or Fixed Interval Random Sampling. Three focus group discussions were conducted to collect qualitative data regarding the study phenomenon. Quantitative data are analyzed in percentage while qualitative data are interpreted in descriptive manner.
Zenodo (CERN European Organization for Nuclear Research), 2019
The study is to examine the socio-economic effects of microfinance of Grameen Bank (GB) on borrower households in the study area. Microfinance of Grameen Bank has a contribution on change of socio-economic status, reducing poverty and increase income generating activities. It is to investigate the socio-economic change occurred among them in the reference time of period. The collected data were estimated using statistical techniques. Statistical analyses include mean, Chi-square test, analysis of variance (ANOVA) test and four Likert scales (four point-scales) such as Strongly increase (Strongly Agree), Moderate increase (Agree), Unchanged (Disagree) and Decreased (Strongly Disagree). The total sample size was only 168 borrowers of GB through simple random sampling from eight centers under four branches, and where multi-cluster sampling has been used for this study. The ANOVA test is performed to examine the association between microcredit and socio-economic factors such as education, occupation, average monthly income, savings, value of assets and cultivated land, etc. After taken loan from Grameen Bank (GB), change of average monthly income, savings, average monthly expenditure, occupation of borrowers, education expenditure for children of borrowers, asset value of borrower households are being increased. The respondents showed the level of changes in 16 chosen indicators separately. Participation impact score (PIS) of selected change items (16 items) reveal that how much changes to have occurred among the women borrowers after joining GB. The result of Standardized PIS (SPIS) reveals the overall significant, which is above 70 percent. The results of PIS or SPIS indicate that the highest score among selected 16 items is for improved participation in family decision-making and the lowest score among all is for improvement counting ability. Finally, coverage and schemes of microcredit programmes, lowering interest rate, extending the repayment period, delaying the start-up of instalment are among the main suggestions that can be pursued so as to obtain better outcomes of microcredit activities in the study area and in the whole country as well. In spite of some barrier of microfinance institutions, microcredit has a positive contribution on socio-economic of borrower households in the rural area of Bangladesh.
International Journal of Sustainable Society, 2012
This paper reviews empirical evidence on the common findings from the existing literature on Grameen Bank (GB) microcredit performance on the borrower's poverty alleviation in Bangladesh. We first examine the GB microcredit impact on poverty alleviation with respect to its member's income, consumption, health, children's education and women empowerment. In general, most of the findings from the literature have shown that Bank members are doing well to reduce their vulnerability and to increase income and consumption, health improvement literacy of children and empowerment compared to non-members and controlled groups. However, this paper also examines some criticisms about the effective uses of microcredit rather than commercial mentality for profit making of microfinance institutions (MFIs).
The Grameen Bank (GB), BRAC and ASA in Bangladesh have developed a successful model of reaching credit to resource poor households that are generally bypassed by Government financial institutions. The article is mainly the comparison of the micro-finance program among the Grameen Bank, BRAC and ASA in Bangladesh. It includes the observations, general overview of micro-finance in Bangladesh. The comparison of the key indicators of microfinance services in Bangladesh. This paper includes some recommendations for the improvement of micro-finance programs in Bangladesh.
Micro-Credit as a Tool for Poverty Reduction in Bangladesh
Journal of Economics and Sustainable Development, 2014
Poverty has remained a global phenomenon and has defied various endeavors at curbing it especially in developing countries. The high and unacceptable number of people within its grip around the world gave it a pride of place as one of the major goals of Millennium Development Goals (MDGs) adopted in 2000. Poverty alleviation was a prime target of the MDGs and micro-credit was recognized as a veritable tool for tackling it. Since the 1970s, especially during the new wave of microfinance in the 1990s, micro-credit has come to be seen as an important development policy and a poverty reduction tool. In this paper, we examined empirically the effect of micro-credit on poverty alleviation in Bangladesh using secondary data. The results of the study show that poverty level is still high among the rural populace; but those that have access to micro-credit seems to have managed better than those who have no access to micro-credit. In other words, access to micro-credit has positive but not significant impact on poverty alleviation among the rural populace. The study recommends that government should intensify effort in its recent financial inclusion strategy to ensure that the rural populace has greater access to micro credits. Government should also ensure that interest rate on micro credits are affordable, the terms of the credits flexible and the conditions attached to the credit well liberalized.
IMPACT OF MICRO-CREDIT PROGRAMMES ON POVERTY ALLEVIATION IN BANGLADESH
This present study examines the impact of micro-credit programmes of six government organisations (GO), non-government organisations (NGO) and micro-finance institutes (MFI) on poverty alleviation in Bangladesh using a purposive sample of 406 credit receivers. Alongside respondent's perceived change in poverty situation this study devised an alternative measure of poverty change based on the change in household wealth and education of a household. Two-level binary logistic regression and multinomial logistic regression analyses suggest that amount of loan, different GO /NGOs/MFIs, satisfaction level, taken loan before and micro-credit as main means of asset change were the determinants of change in poverty situation. Significant community level variation was found in this analysis which indicates that the respondents from different communities with same set of characteristics will exhibit different influences on the change in poverty situation. Further research should be carried out to identify the sources of such variation to optimise the effect of micro-credit.
Micro-finance has received a global recognition today not only as a powerful instrument for poverty reduction and empowerment of women, but also as a promising sector of financing for the banks, financial organizations and NGOs. The Grameen Bank and ASA in Bangladesh have developed a successful model of reaching credit to poor households that are generally bypassed by Government financial institutions. The present study aims to find out the comparison of the microfinance program between the Grameen Bank and ASA in Bangladesh. This research is conducted on the three Upazilas of Comilla District in Bangladesh. We have used survey method to analysis the real scenario of microfinance system of Grameen Bank and ASA from the field level beneficiaries and the officials as well. Secondary data also used in this study. This paper includes the observations, general overview and key indicators of microfinance services in Bangladesh. This paper also shows problems of microfinance and suggests some recommendations for the improvement of micro-finance in Bangladesh.
Journal of Social and Development Sciences
Microcredit is the most effective and successful way to let the poor having access to credit. Research to study its impact on alleviating poverty among the poor is numerous. However, unlike others, our study examines the effectiveness of Grameen Bank and BRAC, the two major micro-financers in alleviating poverty among the most disadvantaged people in Bangladesh. Hitherto, a study of this nature in which two Bangladesh's micro-financers operating in four districts are surveyed and appraised side by side is hardly at one's disposal. As such, this study can be considered as pioneering in its attempt. Our study has revealed the followings: (i) the poor are the direct beneficiary of the existing micro-finance institutions in Bangladesh. Nevertheless, some of them, especially those who have accounts in both banks, are having problem to repay the loans. Therefore, a mechanism has to be devised to limit each person to enjoy one loan at a time. In addition, a high percentage of the poor in Bangladesh is looking forward to making loans from interest-free banks; and, (ii) the services rendered by both micro-financers to the poor are still no better than the conventional banks. In fact, more than 50.0 per cent of the respondents have shown their dissatisfaction with the services extended to them. To address this problem, it is highly recommended for both micro financers to improve their services by way of making it mandatory for their staff to undergo relevant training programs.
2019
Micro-credit is a powerful tool which contributes significantly for alleviating poverty and improving living standard for sustainable development of the rural area. Several microfinance institutes such as Grameen Bank, BRAC, ASA and Jagoroni Chakro Foundation (JCF) and others are working in Bangladesh. The aim of this study is to investigate the impact of micro credit program to improve the living standards of concerned people in Rajshahi and Natore districts of Bangladesh. The empirical study shows that 78.6% of the respondents are female and only 21.4% are male and most of them are belong to the age group 31-40 and maximum number of the respondent's education level is below primary. Some of the factors that show the improvement of the living standard are increased education enrollment, safe water, hygienic environment, nutrition and adequate food, household assets, income, and savings. After joining this program, about 69% of the respondents increase their saving. And most of ...
MICRO-CREDIT AND POVERTY REDUCTION: A CASE OF BANGLADESH
Bangladesh is a pioneer and home of conceptualizing micro-credit program. It has undertaken a number of such programs to reduce poverty and bring about socioeconomic changes in the rural community. The main purpose of this paper is to give an overview about access to micro-credit for rural poor and its impact on their poverty situation and relevant factors related to income of the micro-credit recipients. Data was collected in two phases from the same respondents (April 2009 and April 2010) using a face-to-face interview schedule from a sample of 360 micro-credit recipients. Additionally, another set of 60 non-credit benefi ciary respondents was also taken as a control group to compare the consequences of the program. Major fi ndings reveal that positive impact was found on income, assets endowment, standard of living and poverty reduction. Utilization of credit appears to be major factor for credit recipients raising income compared to their control group. This shows that micro-credit tends to be an important factor to have an impact on household income which minimizes the poverty situation to a reasonable extent.