Social Impact Assessment of Microfinance Programmes - weman

The positive impact of the credit was also apparent as many women said that not only had
the business prospects improved through the credit, but also their families ate better food,
and had better education and health facilities. Most women started their credit
programme with Kashf on Rs. 6,000 and now had gone up to Rs. 30,000. At this point,
many borrowers felt that the loan amount should be increased to Rs. 50,000 or more, as
they required more to expand the business further and were also in a better financial
situation to repay it. At least a 50 percent increase was reported in the family income
after the Kashf loan by the mature borrowers.
Eight years back, Perveen’s husband divorced her leaving behind two young children.
She had no family of her own and no other source of livelihood either. All she knew was
how to sew and stitch, so she started making small earnings through stitching
neighbourhood women’s clothes. Six years ago, Kashf came into the area. Her first loan
was Rs. 6,000 from which she bought cloth from Peshawar and sold it on profit in her
area. Gradually Perveen started buying more and more cloth and sold it in the Lahore
market on a profit margin. She has been a Kashf client for the last 6 years and has taken
a loan again this time of Rs. 20,000. Her monthly income is almost Rs. 10,000 a month,
which according to her, she could not have accomplished without Kashf.
Dropout cases were reported, but were few. According to one of the group participants,
that in their four years of being together as a group only two women had been dropped
out of the group by the members, as they did not pay on time and the other group
members had to pay on their behalf.
These women were quite comfortable with the various mechanisms of the Kashf
programme and organized their savings and personal loans provisions according to their
needs.
‘We also do personal savings other then Kashf savings. I use the personal savings for
everyday needs, like if a guest comes over and a special dinner has to be organized I
don’t need to go to the neighbour’s house to borrow some amount; the Kashf savings I
leave aside for emergencies like an illness, etc. The Kashf personal loan I use for home
repairs or other personal needs at that time.’
(FGD Participant, Chungee)
Only when probed or told about a more flexible recovery mechanisms, did women state
that they wanted lower interest rates; however, there was no unprompted mention of
higher interest rates. Clients felt that as they were paying twice a month, the burden of the
interest rate did not bother them as much.
The mature clients also had a higher awareness level regarding the reasons for certain
Kashf rules and procedures. Some of the women explained that they understood why the
organization wanted 25 members and not less.
Having 25 members reduces the operational cost of the programme. If there were fewer
women, we would have to pay higher interest rates.
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