Microcredit, poverty both rising: Muhith
Thursday, 05 August 2010

The rate of poverty reduction does not match the expansion of micro-credit in the country, said the finance minister.

"Poverty alleviation is not reducing at the desired pace in spite of increase in disbursement of micro-credit," said finance minister AMA Muhith on Wednesday, while speaking at the award giving ceremony of the 'Citi Micro-enterprenuership Awards 2009.'

"Microcredit has seen a boom in the country; the micro-financers claim that altogether their client-base has topped 30 million, but still poverty is increasing," noted the finance minister.

The difference between the microcredit figures and the reality of poverty indicates that there is a problem, added Muhith.

According to him, the rural economy is "somehow trapped in low-level technology".

Pointing towards the "limited improvement" of health and sanitation in the rural Bangladesh during the last century, Muhith said that it is lagging behind in its use of technology.

He admitted though that, "lack of education is also a major hindrance for rural development."

Economist Wahiduddin Mahmud, also speaking at the occasion, stressed the need for removing institutional and legal intricacies faced by micro-entrepreneurs.

"The micro-entrepreneurs cannot operate properly due to the risk and the associated costs are higher," he said.

Mahmud said that the government should encourage micro-entrepreneurs to take on the legal requisites of trade license, TIN, and VAT registration, by providing a stimulus.

The awards, organised by the Citi Foundation, an arm of the Citi Bank NA, were given in four categories.

Shefali Rani Roy from the southern district of Shatkhira, who runs a business which makes and sells Shankha— a traditional ornament wore by Hindu ladies - won the award of the Best Micro-entrepreneur of the Year.

Rehana Begum, a physically handicapped woman in her mid-twenties, who had built a complete farm house at a small village in Joypurhat was the recipient of the Best Female Micro-entrepreneur Award. Rehana now has over 1,000 chickens, in addition to some ducks and cows, as also runs a fisheries venture in the pond beside her home.

Pabna's Nurunnahar Begum is widely respected by those who live in her own village for her advice in vegetable farming - won the award in the 'Best Micro-entrepreneur in Agriculture' category.

"It was not like this when I started ten years ago," recalls Nurunnahar, "I had to face a lot of barriers from these villagers."

The award for the Best Micro-finance Institution went to Gaibandha's Samaj Kallyan Shangstha (SKS).

Source: bdnews24.com

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