Integrated Financial Services Programme

Approach

FIVDB has been providing financial services for disadvantaged communities in Northeastern part of Bangladesh since early 80’s. The programme has evolved over decades and presently offers services in mobilisation of savings, micro-credit, enterprise credit, specialized services for ultra poor households and technical assistance and financial support for installation of solar home system. These services are provided through groups, most of the groups and their members are rural women.

Each group has 15-25 members. They receive an orientation on financial procedures and discipline. The savings by each member of the group starts from the inception of group formation. They usually save taka 20 a week. Following this process of group discipline and savings in about 7 days time the members start receiving micro credit. Each member can borrow taka 1000 to taka 80,000 as micro loan.

The successful micro borrowers can apply for enterprise credit. Enterprise loan is a service product to assist group members to set up larger scale economic activities which result in enhanced income and employment opportunities. The amount of the enterprise loan ranges from taka 50000 to taka 15 lacs.

For last few years FIVDB is promoting and extending solar home systems and solar technology among under-served communities which is not connected with main electric supply grid. Different packages of solar home systems are installed in different parts of rural areas. The service package include solar home system, required credit, installation and after sale services.

IFSP Services

Savings

The objective of savings fund mobilisation is to create regular savings habit among the clientele groups and to form the capital base of their own. A group savings fund is generated through a mandatory savings regime of minimum 20 taka by each group member every week. The savings fund earns an interest of 6% annually (equaling that of bank interest).

Micro-credit

A group becomes eligible to receive micro-credit support after 7 days of group formation, provided group activities during the development stage has been completed satisfactorily. The objective of micro-credit support is to provide the members with financial capital needed for income generating activities that would enhance the members’ livelihood and create employment in the rural areas. Credit is disbursed in a scheme basis among the group members. A loan scheme is formed comprising one member from each sub-group. Credit is provided to schemes in priorities chosen by the members themselves and disbursement to any member of the concerned scheme is subject to satisfactory repayment of the sub-group members who received loan in earlier loans. A 24% declining rate of interest is charged against disbursed credit. Members pay back their loan along with service charge in 48 weekly installments. The loan amounts range from Tk 1,000 to Tk 80000.

Enterprise Credit

Small Enterprise Loan is provided with the aim of increasing the diversity of economic activities in the rural areas by supporting economic enterprises. These are mostly non-traditional activities and assist in increasing employment and income of the member households. The enterprise loan ranges from Tk 50,000 to Tk. 1,500,000. The enterprises include baby taxies, taxi cabs, pickups, power tillers, workshops, small processing plant, shops, pharmacies, grain storages, boats, fisheries, horticultures, nurseries etc.

Solar Home System

There is an acute shortage of electricity in Bangladesh. Particularly people of rural areas get less or no access to electricity. Green technology like solar home systems is a solution of this problem. This technology is economically viable and environment friendly. This also helps in augmenting working hours of people and study time for children. Keeping this in mind; FIVDB has started Nirmol Shokti Prokolpo in the year 2008 as a piloting project.

Festival Loan

A festival loan is provided to members so that they can celebrate their main festival with the members of their family.

Loan Insurance

If a group member dies while being a borrower, the deceased’s family will receive the same amount of borrowed money (principal loan) as insurance. This measure assists the family members from encountering financial crisis/burden.

Members’ death safety benefit

Provide assistance to the inheritors of the deceased member of any group so that they may not face any financial problem due to the group members’ death. An amount of taka 5000.00 is provided to the family of deceased.