Access to finance could reduce viol-ence, empower the most vulnerable in society and improve the livelihoods of Cambodia’s poorest people, a conference on community-led funding heard on Wednesday.
Opening speaker Khem Chamroeun, secretary of state at the
Ministry of Women’s Affairs, spoke of her experience of coming from poverty.
She linked the importance of saving to empowerment, gender
roles, strengthening the family unit and reducing domestic violence.
“If women don’t increase their own livelihoods and rely on money
from their husbands, they will never be empowered,” Chamroeun said.
She added that without economic empowerment, Cambodian society
could not move on from the stereotypes of “strong” husbands and “submissive”
wives.
Sarah Sitts, country manager of the international NGO Pact,
introduced the funding model of savings-led micro-finance (SLMF).
In contrast to credit-led microfinancing, in which an
organisation lends to smallholders, SLMF was a fund established by 20 to 25
voluntary members who lend within that fund, Sitts said.
Interest gained from the loans was used as interest acc-rued on
savings, she said.
Sitts said such models provided access to small loans that might
not be commercially viable for financial institutions, and self-governance and
shared decision-making by members on policy and interest rates empowered
communities.
“A key principle that many organisations feel strongly about is
that all of the funds remained sourced from the communities,” she said.
Brian Lund, the East Asia regional director of Oxfam, provided
an overview of the accessibility of finance in Cambodia, positioning commercial
and savings banks at the top of the pyramid and SLMF below credit-led fin-ance
at the bottom.
“SLMF provides access to funding for those at the bottom end —
below the poverty line,” he said.
Consistency in the principles of those institutions from top to
bottom would allow people to climb above the poverty line, Lund said.
“It’s only when we work together that we have a common strategy
and a common set of principles.
“We try to reach different parts of the market, realising we
have different skills to do that, and we start to position SLMF more
strongly.”
Seng Takakneary, president of the Cambodia Women Entrepreneurs
Association, knows all too well the chall-enges budding Cambodian businesswomen
have in acc-essing finance from tradit-ional lenders.
“It is difficult because it requires a lot of paperwork, and
without education women cannot borrow money from a bank. That is why we try to
find appropriate courses for them, to learn about book-keeping, maintaining a
fin-ancial report and business plans,” Takakneary told the Post yesterday.
According to Chanthavy Meas, program officer at a women’s
empowerment project with PACT, SLMF has had a significant impact on the lives
of more than 4,000 Cambodian women participating in the program.
About 30 per cent of them reported earning more than 12,000 riel
($3) a day before the project, rising to 59 per cent in this wage bracket after
it.
“Some women have become deputy village chiefs, contributing to
decision-making in their communes,” she said.
Care Cambodia assistant country director Bill Pennington
estimates 45 per cent of loans from savings groups are for agricultural
production.
Although there are only 100,000 members involved in the groups
in Cambodia, he forecasts one million members would equate to an
expenditure of $30 million a year on agricultural inputs.
Pennington said access to affordable funding to enhance
agricultural production, borrowing for down cycles and resilience to
shocks such as flooding or family illness were critical to lifting the rural
poor out of poverty.
“Being a member of a savings group won’t get you out of poverty,
but it gives you access to affordable finance that helps you make an
investment in your productive resources for your children’s education and your
health that will get you out of poverty.”
Source: http://www.phnompenhpost.com/2013032964776/Business/striving-to-make-finance-accessible.html