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INAFI Bangladesh has launched a project on ‘Institutional Support for Productive Utilisation of Migrant Workers Remittances’
INAFI Bangladesh has launched a project on ‘Institutional Support for Productive Utilisation of Migrant Workers Remittances’. The project is supported by Remittances and Payment Challenge Fund-RPCF (a joint project named Remittance and Payment Partnership-RPP of DFID and Bangladesh Bank). Initially the project will be implemented for 18 months. RPCF has awarded a cost sharing grant to INAFI Bangladesh to commence providing skills training, entrepreneurship and business development services to migrant families and returnee migrants through 5 of its member NGO/MFIs (Padakhep, UDDIPAN, Shakti Foundation, POPI, SSS) in 14 of the most migrant-prone districts of Bangladesh (Tangail, Noakhali, Feni, Dhaka, Naraynganj, Munshiganj, Brahmanbaria, Gazipur, Comilla, Chittagong, Chandpur, Mymensingh, Narsingdi and Kishorenganj). INAFI and its members will contribute 35% towards the total cost of the project.

The International Network of Alternative Financial Institutions (INAFI) is a worldwide network providing support services for its microfinance provider members. With 25 members, INAFI Bangladesh Foundation, the national arm of the INAFI Asia network, shares the same philosophy as the international network with a focus on advancing progress of the local microfinance sector. Activities in Bangladesh encompass capacity building of member MFIs through tailor-made training, thematic conferences, seminars, credit rating, self-regulation, research & development, and advocacy on strategy and common sector issues.

People usually migrate internationally to change their destiny but their migration also transforms the conditions of their families in Bangladesh. Remittances play a significant role for socioeconomic development of poor individuals and communities around the world. MFIs can accelerate economic development through initiating programmes for remittance recipient families in addition to their traditional microfinance and microenterprise lending activities. INAFI’s partner MFIs operate in the rural areas where many migrant families live, and their experience helping the poorer members of the community are valuable for migrant families also. These migrant families may not need the microcredits, and so do not access the valuable skill building efforts that are provided by the MFIs. INAFI Bangladesh considers migration and remittances as an important tool for poverty alleviation. A significant portion of remittances is utilised in non-productive investment, so INAFI Bangladesh is giving more emphasis on productive utilisation of remittances like enterprise development, long term savings, pension scheme contributions etc.

Over an 18 month period, the project’s activities will enable INAFI and its members to establish themselves as professional providers of services that can be continued in a sustainable manner. Existing training materials of INAFI Bangladesh and its partner MFIs on enterprise development will be fine-tuned and new materials developed; 100 staff of the 5 MFIs will be trained as trainers; 2,000 migrant family members will be provided with basic finance and marketing skills; 2,000 clients will be provided with business skills, especially on chicken rearing; 500 clients will benefit from business development services; facilities for linkages in between enterprises, suppliers, buyers, and other parties provided; 100 enterprises will be linked with SME Foundation and mainstream financial institutions; and 5 peer groups workshops to allow clients to share experiences sharing will be conducted. The aim of these activities is to allow migrants, returnees, and their families the opportunity to build successful and profitable commercial enterprises and can operate those profitably.

The project is expected to have positive impact on micro, meso and macro level economy. The micro level or client level impact indicators are investment enhancement, increased family income, increased working capital and assets, higher savings, increased social security, household employment generation, and skills and technical knowledge development. The meso level impact indicators include vibrant rural economy and financial market, employment generation in the rural areas, and economic multiplier effect. The macro level positive impact indicators are SME development, development of backward linkage facilities for large industry, employment generation, contribution to GDP and increased remittance flow.

   

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