Friday, April 25, 2014

Re the micro-finance institution in Labasa

from w
One letter writer in the Fiji Times is not happy about the closing of the micro-finance in Labasa.

Micro-finance decision
GOVERNMENT'S decision to close the Co-operative Micro-finance Institution in the North has served the rural members a severe blow of financial exclusion.
Certainly the move is not consistent with the co-ordinated approach for the development of the North being advocated by the acting Commissioner Northern and the Ministry of Agriculture (FT 24/3, FT 25/3, FT 8/4).
Whatever reason is given for the closure of the institution, it definitely is not for the poor management that caused the failure of the other rural-based micro-finance institutions across the country (FT 24/4).
Co-op MFI North has been ably assisting its members to create and sustain their livelihoods since 2005. Its cash position is healthy, even after the withdrawal of government cash grants, and members' deposits are intact.
Members are shocked at the insensitive decision to close the institution without considering their and potential members' needs.
Hundreds of savers, including farmers, fishermen, beekeepers, market vendors and other small and micro businesses, have benefited from the service with their equity contributions towards funding assistance from the Northern Development Programme (NDP) and other agencies, for their business start-ups.
Members in Macuata, Bua and Cakaudrove are linked to some of the various government development initiatives in these provinces. They are the marginalised and the poor who are contributing to the economy through the empowerment provided by the micro financing service. This is what the governor of the Reserve Bank meant when he spoke of the benefits of financial inclusion (FT 26/3).
According to the Bureau of Statistics 2009 Household Income and Expenditure Survey, the North has the highest percentage of the population living under poverty and the highest incidence of poverty in the country.
To close the micro-finance service will further marginalise potential beneficiaries, the aspiring entrepreneurs.
They will be consigned to the mercy of the more exclusive financial institutions with rigorous access conditions and to the informal loan vendors, who tend to prey on the desperate needy.
The government's decision to cut off the service in the North is a regressive move and contradicts its own aim for a co-ordinated approach to development.

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