Apologies for the week long hiatus from writing! Kelly and I have been extremely busy at work and I made the ill-informed decision to not bring my laptop into the field with me. It was honestly the most amazing experience I have had yet and I learned more about Grameen than I have in two years of classroom lectures.
Our 6-day field visit provided a rare opportunity to learn about the day-to-day functioning and internal operations of the bank—something which often gets overlooked in literature on microfinance. It’s exciting to learn about how Grameen serves over 8 million borrowers and won a Nobel peace prize, but I’ve always wondered how they ensure quality service and attention to each of the vulnerable women they serve. After 6 days in the field, the answer is slowly beginning to form—however so are my doubts about replication in countries that do not have the same community aspect that is so finely intertwined into Bangladesh’s culture. Having a close proximity and relationship to one’s neighbors is a key pillar to the success of Grameen’s groups, and it’s these relationships that I’ve seen that both excite and worry me.
We set out last Saturday at 8 in the morning to take a four hour drive out of the dust and absurdity of Dhaka, and arrived in a world of rice paddies and community in a village just north of Dhaka, called Netrokona. Organized in teams, we were dropped off in groups of three into various branches of the village. These branches were far enough apart, and serve a wide range of borrowers (each branch manages 60-70 centers) so that each group had a fresh sampling pool of Grameen borrowers and staff to interview—most of which have never had a foreigner visit in their history. With a suspicion that the Colonel truly scared the head office into treating Kelly and I well, we found ourselves placed in a village completely flooded with bright green rice paddies, dirt roads, excited children and an extremely welcoming Bangladeshi family. We only say this because the branches the previous teams were dropped in were smaller versions of Dhaka—complete with the dirt, pollution and constant yelling. Ours was heaven. In most Grameen branch offices, the first floor is designated for the bank’s activities, with the second floor being split into two small residential units—one for the branch manager and his/her family, and the other for bank staff or guest housing. We were given two small bedrooms in the guest unit, with our absolutely charming German friend, Annunciata. Somehow, this girl rips her rough German accent out of her personality, and has the cutest English accent that is straight out of The Sound of Music.
Contrast to the other teams we were welcomed in by a family: the branch manager, his young wife and their Hitler-esque son Tanzim. We also brought a translator employed by Grameen, Matin, who was both a perfect translator and resource into the inner workings of the bank.
After discussing with us our interests and hopes for the 6-day stay, he organized a program that fit our needs and the capacity of the bank. We attended morning center meetings to watch loan repayment and accounting, and then spent the rest of the day interviewing various borrowers. We asked to speak with a new borrower (fresh into the system for only 2 weeks), a struggling member in the beggar program, a microenterprise loanee, a higher education loanee, a scholarship student, and a borrower who switched to a flexible loan due to difficulty in making her installments. These interviews were all really helpful because we didn’t want to see only the success stories, but rather hear the stories of women who wouldn’t be perfect candidates for a photo-op. Matin managed to arrange all of these meetings, as well as interviews with both the Area Manager and Zonal Manager for the Netrokona district.
The first morning we had a homemade breakfast served by the branch manager’s wife, and then departed via rickshaw for our first center meeting. We always looked like a poorly orchestrated parade, as apparently many Grameen staff pick motorcycles as the transportation of choice. One or two would always be in front of us—usually the Center Manager for that day’s meeting and our translator—with the branch manager following us from behind. I think for the rest of my life I will always get a laugh and a comfort from the knowledge that Grameen delivers micro-credit to the poorest of the poor in Bangladesh via a team of White Knights dressed in business casual roaring in on motorcycles. Really, are they serious? This is great.
Each center meeting begins around 9-9:30am, and is typically in a prominent place in the middle of the community. If shelter or space isn’t available, Grameen provides the Center’s women with an interest-free loan to construct a modest tin building that they can call their own. Every time we arrived, the groups (typically 5 in each center=50 women) were always sitting in rows of five, with a neat straw mat in front designated for the Center Manager. The Center Leader (a woman in one of the 5 groups, elected by all to run the meetings and help collect installments) was always sitting in the front left corner. She would rise to her feet upon our entrance, and raise her right hand to her forehead in a less stiff salute than the West—a signal that is used in all Grameen centers to acknowledge that the meeting has begun. Counting to four in Bangla (it’s pretty hideous that I still can’t confidently type it after hearing it for a week), the center leader signals everyone present to stand, asks for permission from the center manager to begin, and then at the fourth command we all sit. Or rather squat. My abs and stamina have yet to master the Bengali squat, as most people in the country sit, quite comfortably it appears, in a position no different from the starting point of a game of leap frog—well, without their hands on the ground. I would be the only one in 50 frequently trying new yoga-like poses to gain enough comfort to listen clearly. Progress is fleeting.
Once everyone is seated, the center leader brought her respective group’s payment up to be calculated, and excitedly told us in broken English that her oldest son was studying at Dhaka University, one of the best in the country, with a higher education loan from Grameen. She was beaming and innately proud. The center manager told us that in addition to the HEL she currently has a microenterprise loan of about 100,000tk for a rickshaw business that she and her husband run together.
With Matin’s help, the center manager explained to us the borrowers’ passbooks where the bank records each installment, and tracks the amount each borrower saves weekly in their personal savings account. The passbooks are extremely clear, and track loans on the left, and savings on the right. We were told we would be mini center managers for the day, and were given the honor of counting some borrower’s installments and savings, and marking the day’s transactions in the booklets. As the booklets are given back to the borrowers at the end of the meeting everything about their membership is very clear in the booklet. The date of the installment, total loan amount, the principal balance, the interest (typically 15-20tk a week, about 20 cents), the total payment, and the borrower’s and center manager’s initial. On the other side of the booklet the bank tracks how much money borrower’s deposit weekly at the meetings into their savings. It is recommended that each borrower pick a specific amount of money to save weekly, usually between 30-50tk—and then when they wish to sporadically deposit more they visit the branch office. The new balance in the savings is always recorded, initialed by the CM, and then handed back to the borrower.
Despite having to do this for about 40-50 women, the process goes very quickly and efficiently. I think a lot of it has to do with the group structure, as the chairmen in each group (one women out of five who is responsible for collecting her group members’ payments before the meeting) comes up one by one and hands each booklet to the CM. On a rotational schedule, the branch manager—and even, we eventually learned, managers from the area and zonal offices—attends the meetings to supervise its functioning and deliver a short motivational speech to the women. He arrives, unannounced, at 2 center meetings a day. I really enjoyed these times, as our manager was very quiet spoken and shy. We had various conversations with him throughout our stay at his home, but he seemed to prefer to listen and smile rather than actively engage with us. However, these few times we got to see him participate with the women we really got to learn more about him, enjoy how he articulated his speeches, and hear the passion in his voice for his work. As Grameen’s narrowing focus is to break multi-generational poverty, the new mandate is to push education, and respectively, the higher education loan and opportunities for scholarships. Grameen offers 5 types of scholarships to the children of borrowers—not necessarily to pay for school fees as schooling is free up to grade 5 and then a small fee for boys up to 12th grade. The Zonal manager later explained to us that the scholarships serve more as encouragement and reward to hardworking students, and help them pay for smaller, but worthy expenses such as pencils etc. Four scholarships are split up into groupings based on age and are put towards academics, and the fifth is for extracurricular activities. I think Grameen is one of the few organizations in the world that actively battles tunnel vision. Many staff I have spoken to speak not solely of business creation and loan products, but also acknowledge the importance of a well-rounded education and the development of a child. One shared stories about their favorite child of a Grameen borrower who is a beautiful singer at the age of 9—a recipient of a scholarship that enables her to travel to competitions. These stories are always great to hear, and although realistically they are not all success stories, they are certainly permeating throughout Grameen’s network of centers.
All center meetings that we attended followed suit. The repayment process was always the same and BM always delivered his message (typically given by the center manager in the branch manager’s absence). As most encouragements are geared towards inspiring women to help their children apply for scholarships and higher education loans, it wasn’t surprising that 100% of hands were always raised when the branch manager asked how many women want to send their children to school. Of course that is just group dynamics, and typically 100% won’t happen, but the branch manager always was reiterating that Grameen has the capacity and the desire to help every student pay for higher education, and that the loans and the scholarships are there for application—truly sending the message back home that even borrowers with infants in their arms need to begin preparing and building that mindset right now. At each meeting I always sensed true and genuine excitement in the women, as they actively were nodding their heads with eyes of hope. That sounds corny, of course, but the reality is that these women are nearly 80% illiterate, and didn’t have these opportunities—let alone weekly meetings from high-up officials encouraging them to take them. Therefore, sitting in these meetings you get a feeling from the women’s and the bank’s excitement that perhaps things really will change—eventually. The branch manager often used the saying “give me an educated woman, and you will have a developed country”. He also said this at one of the meetings to all of the women: “We are a Nobel laureate organization. We are the best…so our children should be the best.”
Aside from education, the business aspect has been consuming much of my time. Borrowers’ businesses have great diversity, ranging from rickshaws and recycling, to clothing and jewelry, with many working in agriculture. The first borrower we interviewed was a woman named Tusi, one of the center leaders. She, and a group of about 15 women, traveled to the nearest branch office roughly 10 years ago and directly asked the bank to open a new branch in their village. After surveying the demand, the bank listened and serves 48 centers across the area today. She said she was hesitant to join Grameen because she had no education, but today has come to love it and her membership because of the banks “encouragement, options and flexibility”. Tusi told us how she had previously had no job before Grameen came to her village, and that now with her rickshaw business she hopes to send her 4 children to school. They are all currently studying, and in addition to the 3 basic loans she has had, has recently taken out a higher education loan for her eldest. When we asked how her family reacted to her joining Grameen, she said that her husband was actually more enthusiastic than she was, and after hearing about the bank in nearby village, came home and asked her to join. With her first basic loan she purchased a rickshaw—which her husband began to drive—and then with her second loan bought another one which she now rents out at a modest profit. Her third loan was put towards agriculture. Tusi told us that one of her favorite parts about Grameen and her role as a center leader are the center leader workshops that are held every three months at the branch office. The workshops seek to teach strong leadership, and gather all of the center leaders from each center together to discuss issues and successes within their groups. Typically, the workshops are taught by the branch manager and his staff, and are used to make center leaders strong women in their communities and groups. Before we left Tusi’s small home, after at least 25 polite refusals for snacks and tea (can’t eat local foods) she told us that her only dream now is for her children, and that she wants us to pray for her and specifically for them. I nodded in earnest as usual, but in cases like these I can’t suppress a smile because I have a feeling in my gut that with Grameen’s support and focus on education, they’ll be just fine.
Later in that first day we went with some staff to visit a few of the borrowers’ businesses. We came across two microenterprise loanees who had flourishing tailoring businesses, but could always only spend a maximum 10 minutes at any one business because the Grameen staff always gets antsy if the crowds that gather to look at us become any larger than 50 people. Keeping us on the move however allowed us to literally stumble onto the doorstep of an orphanage called the Government Children’s Center, a house for 100 boys that is funded by, well, the government. Accompanied by Grameen staff, and at least 20 children from the streets, we went inside the compound to be greeted by 200 beady eyes and subsequent stares. The yard was refreshingly large and open—with more space for the home’s children than I’ve seen at orphanages that struggle to house twice the number. Miraculously escaping the inevitable swallowing of all of the children, we were entertained in the manager’s office after watching my Grameen counterparts play some children in a game of cricket—which despite being in a country that is currently overcome with excitement with the world cup down the street, I still think it’s a weird game, and don’t get it. The staff at the orphanage were happy and eager to answer all of our questions. With 100 kids they operate with 16 supervisors and run primarily on donations from USAID, Save the Children and the Bangladesh government. It was comforting and oddly amusing to stumble across this orphanage in a remote village in northern Bangladesh—a nation who has little relations with the US, and yet see where some of our funds go to. It’s an interesting perspective to gain that some of USAID’s money goes to support 100 Bangladeshi children in a town few have ever even heard of. In recent years I have become increasingly skeptical of traditional donation-based organizations (hence the trend towards social business) but the day’s unexpected adventure reminded me of the important place some nonprofits do fill.
The remainder of the week followed these similar themes. Each center meeting provided an opportunity to have a real sample pool of the percentage of borrowers utilizing the different products offered by Grameen. I have noticed so far that 100% have personal savings account (however this is a nearly useless statistic because it was mandatory before last month), about 75% have at least one GPS (Grameen Pension Savings), and nearly 100% have loan insurance (also a silly fact because that also used to be mandatory…however when asked if they are continuing to pay for insurance despite the amendment to the rule, nearly all still choose to pay). There also seems to balance in how many borrowers choose the different types of GPS accounts—red and green. A red GPS requires a 50tk transfer from their personal savings account each month, or 300tk every 6 months, and a green GPS is paid in cash to the center manager.
The interviews this past week also filled in some of the remaining questions surrounding the higher education loan and its process. Our interview with one of the loanees explained that the application requires a letter of proof from their destined university (essentially a letter of acceptance), a letter from the university explaining the loan amount required, and a budget of expenses from the student. Both the mother and the student must sign the contract, and neither may receive the funds separately, but rather must come to the branch office together every 3 months for disbursement. This particular student was studying accounting and was in year 2 in his 4-year university.
Certainly the most trying of interviews so far was with the two borrowers who are in Grameen’s Struggling Member Program for beggars. We had asked a few of the center managers in the branch office if they had any beggars under their management, and were able to speak with two on our last day and visit their homes. Both stories were vaguely similar in that both have been widows for nearly 2 decades, with one of the women being a mother of two, now grown children. With 500tk one woman bought sugar cane and sold various products as much as she could, but admitted that she continued to beg when she ran into difficulty in sales. The other woman bought beetle leaf, which is a cunningly innocent looking green leaf that many here in Bangladesh chew, similarly to chewing tobacco, that turns mouths and teeth bright red. Every week each woman tried to attend center meetings—that actually is not mandatory of those in the beggar program—and give 30 to 40tk in installments. Every week, one borrower saved 10tk, and yet the other did not save any—so the branch manager suggested that rather than paying 40tk a week she could pay 30 and save the additional 10. Both woman appeared to be in their mid-sixties; however, they were realistically only in their fifties, but life had thrown every last thing in Pandora’s box at them. With a hunched over frame and blurry eyes, one of the women explained that one key factor pushing her to try and make her business a success was that she no longer had the physical capacity to carry herself around various towns and villages every day to beg—therefore making a successful business one of her last viable options for survival. We learned that they were recruited to join Grameen by one of the center leaders, and continued to have the businesses they started with their initial loan. It was upsetting to hear that after 2 years of being in the program they were now on their second loan, after repaying their first, but hadn’t managed to increase their capacity to take out more than 1,500tk (about 20 dollars) and move up into more structured basic loan. Without a husband, nor children financially supporting them, and without a home larger than a chicken den, how on Earth did they survive for 2 years selling leaves and sugar cane with a $20 loan?
When asked if they felt they were ready to move into a traditional lending group, they said they felt they were on the right path, but the neighbors nearby told us that their health was poor. When we were brought by the women to each of their houses, it quickly added factors to the story that made me think the beggar program was not working as hoped. Walking behind her, we came upon a typical home in the village—typically the size of a shed thrown without half an after-thought behind a colonial-type home in Massachusetts. Small entrance way, tin roof (which is a strong sign of progress in rural villages) straw walls. I thought nothing peculiar walking up to the home, until slowly it registered that she walked beside the hut to an impossibly smaller hut struggling to stand alongside of it. Standing around four feet tall the straw hut was not fit for even mistreated chickens. That may sound a bit harsh, but it is the most accurate description of how unsuitable of a home her house was—especially for a 60-ish year-old woman. After crouching behind her to peek my head in the hole in the straw wall that served as a door, I heard the translator next to me quietly gasp as if life had just left him. Before us was an excruciatingly stark picture of what nearly 3 billion people living on less than $1 a day call home. Literal dirt floors, spans of light filtering in through breaks in the straw walls and roof, and a heap of hay in the corner. The absence of bedding or even fabric for that matter made my scarf begin to tighten around my neck until I backed my head out of the hole and my eyes began to spin. Living right in the middle of a community of neighbors, who simply by their presence were guilty and complacent, this woman didn’t even have 5 inches of cloth to lay her aging head on every night...who explained to Matin that she slept on the floor each night. This to me is a Grameen failure. Sure, she says she has quit begging. But after 2 years of being a Grameen member she has not been able to move up to a basic loan, or earn enough to breakeven in her business without intermittent begging. Her situation was such a stalemate, that the branch manager—who is dedicated to Grameen’s philosophy that under no circumstance should donations be given—took 100tk out of his wallet and gave it to her, explaining to us later that at least she would have a decent meal that day.
After hearing a great deal about her personal story and business, Kelly, Annunciata and I began to look at each other with the subtle agreement we have mastered in our facial expressions to let each other know that we have no further questions. Most of my questions that rose out of that conversation are now directed back at the bank, because beyond learning about the 0% interest rate that accompanies beggars’ loans we haven’t learned the full story regarding the role the center manager and leader plays in interaction with beggars, and what type of technical support they receive in addition to capital. Surely there isn’t a clear cut answer as to what step should be taken or what the exact problem is that is restricting this woman’s potential. Was it her confidence level after 14 years of begging, was it laziness, a need for more capital, advice, encouragement, one-on-one support? Probably all of it, but after hearing directly from many staff about their most cherished moment working with Grameen, and hearing them explain the day when they watched beggars rise from the ashes it makes you wonder what separates these success stories from the failures. After back and forth conversation about the facts that day we left the field quiet. The rickshaw ride back to the branch office was a comfort despite the second by second pothole, as the noise provided an opportunity to just sit and finally be as speechless as I had wanted to be for the previous hour.
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