Staff Reporter :
Country’s small grassroots micro finance institutions (MFIs), non-government organisations, have expressed their grave concern over the government’s move to reduce service charges of their organisations saying it will poise a threat to the existence of the sector.
Their concern over the issue was expressed in a press conference held at the National Press Club in the city on Tuesday.
Atiqun Nabi of INAFI moderated the briefing while representatives from different MFIs, including Shova Rani Mondol of SASUS, Tangail, M Rafiqul Islam of SUS, Mirzapur, Tajul Islam of USA, Narayanganj, Arjuman Begum of DPUS, Khulna, Mojibul Haque Faruqi of AUP, Dhaka, Dr Tasnim Ahmed of BEDO, Dhaka, Shamsul Haque of ARS, Jessore, Rezaul Karim Chowdhury, Mostafa Kamal Akanda and Tariq Sayed Hasan of COAST, Mossadeque of FNB and Abdul Awal of CDF spoke on the occasion.
Speakers in the conference urged the government to halt the process of further reduction of micro finance service charge which, in fact, will be a threat to the existence of 505 such organisations. They constitute 77 per cent in the sector.
There are total 659 MFI NGOs in view of MRA (Micro Finance Regulatory Authority) under Bangladesh Bank.
On behalf of the grassroots MFIs, Tarik Sayed Harun of COAST urged the government to consider their five point demands before taking final decisions.
The demands are: (i)Compare with other countries in Asia micro finance service charge is lower which is only 27 percent, (ii) surplus rate of grassroots MFIs is only 9.8 percent while it is around 46 per cent of the big MFI NGOs, (iii) grassroots MFI NGOs are very much accountable to local community, work in remote places and stand by disaster to the poor families, (iv) these small grassroots MFI NGOs who have branches 1 to 10, hardly get capital from Bank and PKSF (Palli Kromo Sohayak Foundation), and (v) if the present government reduce the micro finance service further then these 505 grassroots MFI NGOs will face possible extinction, which will be a hindrance to equitable growth and will create an imbalance in the sector.
Shova Rani Mondol of SASUS, Tangail, stated that how she was surviving in serving women development through his micro finance and without any donor funding.
Tajul Islam of USA, Narayanganj, stated how he had created employment opportunity for him as well as the youths in his locality.
“As other agencies of the government increased salaries I have to increase salary of my staff members. In this situation, the government should consider to increase the service charge,” Mujibul Haque Faruqi of AUP, Dhaka, said.
Rezaul Karim Chowdhury of COAST said, “In view of UN initiated World Humanitarian Summit, these local grassroots NGOs deserve support as the micro finance sector should not fall in the trap of monopoly.”
He also said if the government implements the decision, then only a few number of big-sized MFIs will be able to sustain in the field.
“A large amount of our fund is in the threat of becoming bad loan due to recent natural disaster and lowering service charge will be suicidal for us,” he added.
