More Than Just Money
One of the MFIs I am working with in Kigali is Urwego Opportunity Bank. In Kinyarwanda, Urwego literally means “to provide someone a ladder up”. Urwego does this not only by providing special loan products for those without access to traditional credit, but also by offering special training to its clients.
When asked to comment on these trainings, the Director of Transformational Impact at UOB said, “people often think that poverty is just financial deficit. However, it also means disempowerment. Training in household financial, business, and health management empowers people. Additionally, training clients helps them understand what will happen to their business if they get sick or mismanage their money.” The Director also noted that training client in these areas reduces risk for UOB, because the better the run the businesses are, the more steady the repayments of the loans.
UOB training modules are purposefully aligned with the Rwandan government’s response to the largest healthcare threats to the population (and therefore the economy): HIV/AIDS and malaria.
HIV/AIDS in Rwanda: The Rwandan genocide of 1994 increased the risk of HIV infection, and thousands of survivors contracted the virus as a result of systematic sexual violence and rape against women. An estimated 70 percent of woman survivors who were raped during the conflict were infected with the virus. The rise in the prevalence rate was especially significant since approximately 800,000 people, 20 percent of the entire population, were killed during the genocide.
Furthermore the differences in HIV prevalence between men and women are significant, with higher prevalence among women ages 15 to 49 (3.6 percent) than that of men in the same age cohort (2.3 percent). HIV prevalence also varies between urban and rural populations. Sixty percent of Rwandans live in rural areas, where the prevalence (2.2 percent) is below the national average of 2.8 percent. At 7.3 percent, prevalence in urban areas is more than three times higher than in rural populations.
Building upon the National Strategic Plan for 2005–2009, the National HIV/AIDS Strategic Plan (NSP) for 2009– 2012 aims to reduce the incidence of HIV in Rwanda by half, reduce HIV morbidity and mortality, and ensure people infected with and affected by HIV have the same opportunities as the general population.
*National Institute of Statistics of Rwanda **UNAIDS ***UNGASS ****WHO/UNAIDS/UNICEF
Malaria in Rwanda: Approximately 90% of Rwandans are at risk of malaria. Malaria is the leading cause of morbidity and mortality in Rwanda responsible for up to 50% of all outpatient visits. In 2005, Rwanda reported 991 612 malaria cases. In 2006, malaria was responsible for 37% of outpatient consultations and 41% of hospital deaths, of which 42% were children under five. http://www.who.int/countries/rwa/areas/malaria/en/index.html
Thanks to government and ministry of health efforts such as passing out insecticide treated nets and increasing awareness, there has been a dramatic decrease in the prevalence of malaria in Rwanda. Deaths due to malaria have dropped to only 7%, a dramatic 60% reduction in just over two years of rapid scale-up. Health center utilization rate is over 70%, with only 10% of patients seeking treatment for malaria (http://www.malariafreefuture.org/rwanda/success.php).
However, with this success comes some anticipated new challenges. For example, as there are less cases of malaria, net usage could also decline and also reductions in natural immunity to the malaria parasite could occur. These new challenges mean that the work is not done, and that initiatives surrounding malaria awareness, prevention, and treatment need to be continued.
UOB is joining these efforts to combat malaria and HIV/AIDS through its non-financial services. Within the healthcare curriculum, there are modules on malaria, HIV/AIDS, and diarrheal disease. I attended an HIV/AIDS session. After everyone introduced each other, the leader encouraged everyone to participate, and announced that she was there to explain important concepts and that everyone must pay attention:
She began the lesson with a review from past sessions on financial management: What is a loan? What is the consequence if you don’t pay? As I listened, I realized that these borrowers had just been introduced to the concepts of loans, saving, and investing rather than flat out spending. This further affirmed the notion that simply giving aid will never be a sustainable way to achieve economic development. These borrowers were learning how to manage their money and look after the health of themselves and their families. The conversation then tied in the concept that one’s health can affect one’s ability to pay back their loans, and how their businesses could suffer from being ill. The lesson emphasized understanding what HIV/AIDS is, how it is transmitted, and how one can protect oneself from it. The lecturer concluded the lesson with the powerful message that “HIV/AIDS is another source of poverty”.
After the lesson I was given the opportunity to interview some of the borrowers. The first woman I spoke to was Beatrice. She runs a business selling shoes and her husband sells chickens. Before her loan she sold water and sodas, and she was making 1500 RWF a day to help provide for her family; now she makes 5000 RWF a day (about 8 USD). This increased income has allowed her to save 2000 RWF a week that she will use to pay for school fees.
Before she came to training, she said she did not know what a loan was, how to use it, or how to save. Before, she used money to buy things without understanding the value in investing and using the returns from her investment to purchase goods.
I then spoke with Mary Rose, who runs a business selling clothes. She uses the loan to help pay travel expenses to Kampala, Uganda where she buys the clothes. She and her husband have 4 children of their own and have adopted 4 children as well. She stated the HIV/AIDS lesson has helped reaffirm the importance of her remaining loyal to her husband for her own health as well as the health of their relationship.
She said she is looking forward to family planning training and the ability to teach others in the community what she has learned about how to use a loan, run a business, and practice healthy living. Through this statement, Mary Rose truly illustrated how using the community group lending model to spread awareness on health and financial management can be sustainably effective.