ASA

ASA was started with a relatively radical social transformational agenda. In 1990-91, its management decided to concentrate on microfinance only by excluding its all other programs gradually. In course of time, it has been well established that the microfinance program of ASA, which is basically divided into two major components, microcredit and microsavings, is the most effective microfinance program. Because, this program of ASA includes the cost reducing and the income increasing factors. This microfinance program can satisfy poor people's financial need as the terms and conditions of the same are easy and income increasing. On the other hand, this microfinance program is cost reducing, simple, flexible and the recovery rate is very high.

So the microcredit and microsavings programs have been proven most effective to ASA for expanding outreach and increasing fund. The main goal of microfinance program through microcredit and microsavings is to strengthen and empower the poor especially poor women of Bangladesh. ASA wants to help poor people to escape poverty and involve them in the development process. The microfinance program achieved a great success because the members, branches and working areas are increasing day by day and the poor women are able to operate their small income generating projects beside the household work with the financial assistance from ASA.

Details of ASA activities have been elaborated with illustrations in the following for more general information. Information reflect here importantly for the year up to 31st December 2000.

Microcredit:

In the field of poverty alleviation, ASA's microcredit program plays an important role. Poor women have created self-employment drawing loan from ASA, which made them self-reliant. They can receive an amount of 4 to 6 thousand as initial loan. The total amount of loan along with 15% service charge is divided into 46 installments, which has to be repaid within a year. The repayment of installment begins after 15 days of disbursement and 3 weeks in a year are considered as grace period. ASA loan products are as follows:

Small Loan:

Landless and assetless women whose monthly income does not exceed Tk. 2,000, and who own less than 50 decimals of cultivable land. Initial loan for them Tk. 4,000 - 6,000 (US$ 75 - 113) and yearly increase amount Tk. 1,000 - 2,000 (US$ 19-38). Loan Term-1 year and Service Charge-15%.

Small Business Loan:

Small business at the market place or small enterprises such as home based poultry farming, carpentry, etc. Initial loan for them Tk. 12,000 (US$ 226) and yearly increase amount Tk. 2,000 - 3,000 (US$ 38-57). Loan Term-1 year and Service Charge-15%.

From the beginning of the microcredit program, up to December 2000, the total disbursed amount and service charges were about Tk. 29,638 million. Total loan realized was Tk. 25,055 million and the amount of outstanding was Tk. 4,583 million among 1,128,693 group members. From January 2000 to December 2000, Tk. 8,487 million was realized including Tk. 996 million as service charges.

	Particulars	Up to 2000	Up to 1999	Up to 1998
1	Total number of group members	1,204,938	1,178,987	894,119
2	Total no. of groups	61,361	58,972	50,201
3	Total borrowers	1,128,693	1,084,318	786,492
4	Total no. of branches	824	800	732
5	Total no. of regions/Area	159	92	92
6	Total no. of divisions	20	16	16
7	Total credit disbursement (Cum., with s/charge)	29,638,230,929	20,680,077,764	13,202,623,399
8	Total credit realized (Cum.)	25,055,171,717	16,557,722,990	10,708,794,758
9	Total credit outstanding (with service charge)	4,583,059,212	412,2954,774	2,493,828,641
10	Credit disbursed during the year (Principal)	7,780,364,000	6,619,326,000	4,328,101,000
11	Total savings (end balance)	1,607,267,134	1,269,003,678	1,080,106,632
12	Rate of recovery (approx.)	99.90	99.93	99.96
13	Financial sustainability (approx.)	123.81%	118.25%	108.66%

Sl. No.	Name of the sector	Percentage	Loan disbursement (Principal)	Loan disbursement (with service charge)
1	Paddy husking	11.53%	897,045,000	1,031,601,750
2	Puffed rice	5.19%	403,602,000	464,142,300
3	Cow rearing	11.40%	886,836,000	1,019,861,400
4	Goat rearing	2.80%	217,796,000	250,465,400
5	Poultry raising	8.35%	649,984,000	747,481,600
6	Fish cultivation	12.12%	942,646,000	1,084,042,900
7	Vegetable gardening	5.01%	389,990,000	448,488,500
8	Rickshaw pulling	11.86%	922,909,000	1,061,345,350
9	Handicrafts	3.18%	247,062,000	284,121,300
10	Betel leaf	4.10%	319,207,000	367,088,050
11	Grocery shop	6.02%	468,260,000	538,499,000
12	Small business	5.92%	460,773,000	529,888,950
13	Others	12.52%	974,254,000	1,120,392,100
	Total	100.00%	7,780,364,000	8,947,418,600

ASA’s Small Business credit product is one of the important components for poverty alleviation and effective entreprenurship development program. All the group members of ASA are involved in various types of income generating activities. ASA is one of the largest NGO in this country with a long established reputation for providing its members with consistently high quality services specially loaning to the small business including

farming, poultry, livestock, handicrafts, grocery shop etc. ASA feels that conducting small business needs experience, discipline, proper planning, manpower, financial management skill, marketing etc. Because in small business capital is limited and risk is more. ASA has disbursed Tk. 3,491,637,050(cumulated) up to December 31, 2000 to the small business members but also helped them providing technical supports to avoid the risks.

	Particulars	Number	Amount
1	Total number of members	68,030
2	Total number of borrowers	64,619
3	Total Savings (end balance)		Tk. 194,929,953
4	Total credit disbursement (Cum.)		Tk. 3,491,637,050
5	Total outstanding (with service charge)		Tk. 527,780,876

ASA Microsavings

One of the most effective tools for poverty alleviation is microcredit, and the savings products are intrinsically connected to microcredit. By saving voluntarily and weekly the group members can enhance their capital. ASA has introduced (1) Weekly savings: Group members have to deposit fixed amount of Tk. 10 per week mandatorily. (2) Voluntary savings: In addition to the weekly savings, group members are allowed to save any amount they wish. These savings programs promote the habit to save and resulting to accumulation of a huge amount of loanable fund.

Total savings mobilization up to December 2000.

The diagram indicating that the rate of savings has been increased enormously with the five years time. In 1995 ASA's savings were 245.63 million taka and in the year 2000 that became 1607.27 million taka.