Banking Sector And Practical Experience
Author: M. Akram Khan
BANKING SECTOR AND PRACTICAL EXPERIENCE
SMALL BANKING AS ONE OF THE TOOLS
FOR EMPLOYMENT GENERATION AND POVERTY REDUCTION
In the developing world huge shift is taking place in attitudes to development and poverty alleviation. Charity, handouts and welfare once
seen as the answer to combating the scourge of poverty, are now perceived as increasing the dependence of the poor. These so-called
solutions have given way to more sustainable options that aim to alleviate poverty by enabling the poor to become self-reliant. Today, we
see the accountability mechanism as the key to breaking the poverty trap.
One way of using such a mechanism is through small leasing. This involves the provision of finance through structures accessible to the
poor at commercial or near-commercial rates and in the smaller amounts that the poor need.
The activity itself becomes commercially viable as the poor pay a price for acquiring the funds and in doing so, bring about a healthy
change both in society's perception of the poor and the poors' perception of themselves.
Small credit to the people at the lower rung in our country can make a noticeable difference as it provides economic opportunities with
dignity and self respect.
This is achieved through the participation of those remarkable men and women, who, throughout the country, provide employment to a
vast majority of our potential work force and produce goods and services for over 70% of our population. Their diligence, determination,
commitment, honesty and sheer hard work is indeed exemplary. Considering that most of them do not have any education or formal
technical training, it is most re-assuring that they have provided the much needed economically priced goods and services, with the
scarce resources at their disposal, to a large number of people at the lowest income levels. Admittedly, the desired level of capitalization
has not yet been achieved as no safety net is available to them. Accumulated savings dwindl