Message-ID: <19960802233532448.AAA107@smtp.persocom.com.br> Date: Fri, 2 Aug 1996 23:35:36 +0000 From: Joaquim Moura <mailto:joaquim.moura@PERSOCOM.COM.BR> Subject: Official MicroLoan System in Brazil To: Multiple recipients of list DEVEL-L <mailto:DEVEL-L@AMERICAN.EDU>
Dear Friends,The Brazilian government has launched last Tuesday its official microcredit system. This fact was quite well noticed by the main Brazilian newspapers. But maybe not enough to make the population aware of it. Maybe most people will never perceive that there is now an "official microcredit system". The project was developed by the federal government social development agency "Solidary Community Council" with support of the federal financial development agency "Social and Economic Development National Bank - BNDES".
The official name is: Programa Popular de Credito, and it will operate two different credit lines, each one with its own lending procedures. Credit line one: "Worker BNDES"; US$ 51 millions to be lent through accords with the states and municipes; Credit line two: "Solidarity BNDES"; US$ 18 millions to be lent through accords with NGOs already working with microcredit.
The amount is small, just US$ 69 millions, but the governmental officers told that it is the program's first year, and they need to be careful. The loans will range from $200 to $5.000, to be paid back in no more than 20 months. The microenterprises cannot employ people from outside the family. But friends can join and apply for a loan in special conditions for cooperatives.
The covenant partner (a state or municipe agency and/or NGO) must get 30% of the resources lent by their projects, as their counterpart. The government technicians suppose that the nogs will get their 30% from international agencies, as World Bank or the Interamerican Development Bank, and - they think - this will facilitate their job - if World Bank and an NGO are partners in some microcredit project, then the BNDES may fund it, too. (This reasoning was published by the newspapers.)
The federal program is wide and open. Each partnership with each state or municipe agency or each NGO will be a different Bank for the Poor, a different model, procedures etc. Every partner must provide all the human and technical resources demanded by its own program.
Although the program was already launched last Monday (at the BNDES headquarters, in Rio, with the presence of the federal First Lady, Ruth Cardoso - president of the Solidary Community Council - and the Minister of Planning, the program will need some time to start lending the money. And as BNDES demands previous experience, they believe that just four projects are able to apply for the resources: BRB-Trabalho (in Brasilia, BRB is the Brasilia governmental Bank); PortoSol (in Porto Alegre, capital of the important state of Rio Grande do Sul, close to Argentina - a program developed by the municipe government); Banco do Jegue (Donkey Bank, NGO project in Bahia); and FENAPE (Small Enterprise Support National Federation, an NGO working with support from Accion International, last year they lent more than $8 millions; FENAPE is the most experienced microcredit program in Brazil).
MY PERSONAL CONSIDERATIONS:
Of course this initiative is very important, but they don't mention the fact that the population is not informed or stimulated to take such an initiative. If we believe that microcredit is a powerful tool to promote social development, we are talking about credit for millions of people. Then we will need also a new culture, which promotes work and productivity, union and creativity, knowledge and organization. But these attributes are scarce among the population, nowadays... We need that, besides the resources, there are also information and communication, to support and empower the many programs that will come, and which cannot fail...
Another point. (but still the same): they (the officers) don't consider how important is the Muhamad Yunus's idea of just to lend money to people organized in groups, where all are collateral of each one. Or how important are the meetings, the centers where the community members discuss the lending proposals, and become aware of their own potential. The official model just mentions that each person will come and get their money; just needs to bring the identity card and a guarantor. So, it doesn't promote any change at the community level of awareness.
As you know, I am involved with microcredit researching there are 15 months, now, and I have learned a lot. I have contacted the team of the Solidary Community Council, trying to work with them (I work in the Brazilian Central Bank and I could integrate their team, if they wish), but they did not even want to listen what I could do for and with them... So, I am not too optimistic about the "natural" way this program is about to take, but I will try my best to help it produces all the best results it is potentially able to give us. Would you like to participate of this adventure?
_____________________________________________________________ Joaquim Moura Partners of the Americas - Brasilia / Washington DC Committee Youth and Citizenship Development Commission Visit our WWW page on community and international development http://webwrite.com/partners.bsb-dc