Source: The Irrawaddy.
Original article available here.
CHIANG MAI, THAILAND, July 1 – A Rangoon-based non-government organization, Myanmar Business Executive Group (MBEG), has announced a 50-million-kyat (more than USD 40,000) microfinance scheme to help victims of Cyclone Nargis in the western outskirts of Rangoon and the Irrawaddy delta.
MBEG said it would offer loans to cyclone survivors who have no collateral by relying on guarantees from other people in their communities.
Speaking to The Irrawaddy on Friday, MBEG coordinator May Oo Khine said, “We are currently lending to 273 families in the Shwe Pauk Kan Township in the outskirts of Rangoon. More than 1,000 people are directly benefiting from these loans.
“We are only targeting families who were affected by the cyclone disaster,” she added.
MBEG was founded in late 2007 by private businesspeople who are all business administration graduates from Rangoon Institute of Economics. The MBEG program is based on the success of the Grameen Bank microcredit scheme in neighboring Bangladesh, introduced some 30 years ago, which, in 2006, earned its founder, Dr Mohammed Yunus, a Nobel Peace Prize for improving the living standards of millions of poor families in the country.
“We give small loans to cyclone victims so they can rebuild their houses and restart their businesses, such as food-vending stalls and other small businesses,” said May Oo Khine.
“Our loans system is based on how much money they can repay. We lend between 50,000 kyat (USD 42) and 200,000 kyat (USD 167) depending on how badly the client’s house was damaged. Borrowers must agree to repay loans within six months,” she said.
The six-month loan incurs a fee of 1 percent per month. The daily repayment is normally between 700 kyat (USD 0.58) and 1,200 kyat (USD 1). Borrowers are granted loans on the strength of recommendations from five other persons. No collateral is required.
MBEG said it has also assisted an estimated 500 farmers in Kawet Yekanchaung village in Dedaye Township in Irrawaddy Division with a scheme to provide mechanical tillers. For the village’s 3,698 acres, MBEG provided 35 power tillers, which farmers could share in order to prepare their fields for harvest.
“A power tiller costs about 650,000 kyat (USD 542). A farmer who takes a loan to buy a tiller must repay half the amount within the first year, at 1 percent interest per month,” said Lin Lin Tin Htun, a coordinator at MBEG.
“Farmers have to complete their planting before July 17. We are worried that they can’t begin planting without power tillers,” she added.
Lin Lin Tin Htun said that MBEG coordinates how much they can finance cyclone victims with its local and foreign donors.
“I appreciate that farmers and other victims told us they didn’t want anything free of charge—just a loan. After the harvest, they will pay back what they owe,” said another MBEG coordinator, Min Oo.
One borrower from MBEG, Than Than Myint, from Shwe Pauk Kan Township, said the microfinance program had given her family much-needed relief after the cyclone.
“I was a boiled pea vendor. After Nargis destroyed my house, I lost all my possessions and had to borrow money,” she said.
“A very small portion of my earnings covers the interest. Now I can fix my house and start work again,” she said.
By Min Lwin, The Irrawaddy
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