Social Impact Assessment of Microfinance Programmes - weman

• Since Asasah has been in operation just a few years, 86 percent of its clients are
still only in their first or second loan cycles. Clearly, any ‘impact’ of the
intervention by microfinance institutions, is highly tenuous, and at best, slight and
partial. We would expect little to have changed in a matter of two years.
• Most of Asasah’s clients, all of whom are women, are involved in ‘business/retail
shops’ or ‘cottage industries’; the perceptions of clients over the loan cycle about
how well they eat, seem to suggest that the longer they stay with the programme,
the greater the perceived impact in terms of improvement in quality of life and
diet, on their lives. On most welfare questions, the longer they have been with the
programme, the better they think they are doing; with numerous small and large,
official and donor programmes funding microfinance, there is a huge amount of
information available about microfinance services and results from Asasah
confirm this view that a large proportion of Non-Borrowers are aware of credit
facilities.
• Asasah’s Active Borrowers have significantly higher Expenditure Per Capita and
Income Per Capita than do all other categories. This suggests that perhaps Active
Borrowers benefit from the microfinance intervention. However, in terms of
Housing variables, this difference is not at all significant, a result which is not
surprising, given the fact that investment in Housing takes large amounts of
capital and investment, and we do not envisage that clients of any microfinance
institutions will be significantly better-off in a couple of years to allow them to
divert excess capital to Housing.
• The results do show that women in Asasah’s microfinance programme feel that
they are significantly more empowered in terms of Economic Empowerment and
in terms of Empowerment Related to Education and Health.
Orangi Charitable Trust
• The Orangi Charitable Trust (OCT) is an off-shoot of the Orangi Pilot Project
(OPP), a non-governmental development institution created in 1980 in the
squatter settlement of Orangi Town in Karachi. Respecting the entrepreneurial
spirit of people as articulated in OPP’s vision, all the programmes focus on
‘supporting effective existing structures’ instead of creating new structures which
would likely be unsustainable and counter-productive.
• OCT started its microcredit servicing from 1987 with an aim to support the
existing businesses. The rationale being that micro enterprises in Orangi were not
able to access loans from commercial banks due to loan size, collateral
requirements and other considerations. The key objectives of OCT are to: provide
credit for the expansion of the existing micro-enterprises in urban communities;
provide credit for agro-inputs in rural areas; strengthen the capacity of NGOs and
CBOs to support micro-enterprises in the area through guidance and training; and,
provide lines of credit to trained NGOs/CBOs
• OCT opted for a different paradigm for microcredit instead of seeing microcredit
as a direct tool for poverty alleviation. Contrary to other institutions, it provides
credit solely to facilitate the movement of entrepreneurs into better economic and
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