Social Impact Assessment of Microfinance Programmes - weman

development. NRSP's mandate is to help alleviate poverty by harnessing people's
potential and undertaking development activities in Pakistan
• The main objective of NRSP is to create a
countrywide network of grassroots level
organizations to enable rural communities to plan, implement and manage
developmental activities and programmes for the purpose of ensuring productive
employment, alleviation of poverty and improvement in the quality of life. The
guiding tenets of NRSP’s philosophy are to organize rural communities develop
their capital base at the local level through savings and credit schemes, support
human development endeavours and link the communities with the government
service delivery departments, donors, NGOs and the private sector.
• NRSP manages one of Pakistan's biggest microcredit portfolios, with 109,614
active loans as of July 2005. As part of its holistic approach, NRSP provides
various financial services to the members of COs in rural areas to help them
implement their Micro Investment Plans (MIPs). These services include: Micro
Credit - individuals through groups and Village Banking; Micro Insurance -
hospitalization and accidental death; Savings - COs keep their savings in
commercial banks or they invest these in Community Physical Infrastructure.
• Microcredit is a major component of NRSP focusing on improving livelihoods. It
is reported to be the largest credit programme in the country after the Agriculture
Development Bank, having so far disbursed Rs. 7 billion in loans since 1995.
Loans are provided to both men and women for entrepreneurial business projects
or for other income generating activities, such as small businesses or investment
in livestock.
• The credit process begins with an initial instalment of Rs.10,000, followed by
further instalments of Rs. 5,000. The interest rate is 10-11 percent over the 12
months credit cycle. However, after the inclusion of the processing fees, the rate
rises to 21 percent. The recovery rate is claimed to be almost 100 percent.
• Each Community Organization is encouraged to collect some amount from its
members and put these savings in a Bank account. During the year 2004-05, the
CO members saved a total of Rs. 71.91 million. Of this amount, men’s COs saved
Rs. 63.81 million and women’s COs saved Rs. 8.10 million. However, there is no
hard and fast rule regarding the savings mechanism. A few COs also have a
‘committee’ system, whereby, savings are rotated among the members similar to a
committee system.
• NRSP provides credit to the members of the COs and the credit groups through a
solidarity group approach. Although, NRSP does not have a preconceived
package, credit is given for any income generating purpose. Other than this
purpose credit is not targeted for any other use. According to NRSP, this
encourages the COs to utilize natural resources and human capital.
• Unlike many other microcredit programmes, the NRSP credit programme gives
loans to both men and women. The programme feels that the ratio of men and
women clients actually reflects community demands and behaviour. According to
the programme figures for 2004-05, Rs. 1,552,335,800 was disbursed, of which
83 percent was loaned out to men and 17 percent to women. Furthermore, as the
programme purpose is to focus on improving the household livelihood conditions,
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