Financial First Responders

Group-Based Financial Services and the Coronavirus
March 18, 2020
Financial First Responders: VisionFund Mexico
March 24, 2020

Most of our clients have escaped the vicious cycle of poverty and are doing their best to secure their livelihoods.  The corona has affected them in multiple ways.  Our big worry is that they may fall back into the poverty trap. Clients must manage daily consumption items, including medicine.  Children are compelled to stay in home, schools are closed, markets are closing slowly, less supplies available.  Those who are doing their family enterprises, agro-based like vegetable farming, milking cows, buffaloes, poultry, fishery businesses are running somehow, but they are also deprived of supplies.  Their production is not getting to market as local bazaars are closed. Clients are asking to have loans rescheduled, installments prolonged.

Last week DSK Rao and I sent out a survey to those who provide financial services to people living in poverty about the impact of the global coronavirus pandemic on their operations.  So far, we have heard from microfinance providers and promoters of savings groups and self-help groups that reach over 11 million households.  (If your organization has not completed the survey, please click on this link to fill it out.) The response above came from Bhoj Raj Bashyal of Swambalamban Bank in Nepal.

Throughout his survey responses I felt Bashyal’s concern for each of the bank’s 247,000 clients.  But I also felt his dilemma.  His bank interacts with clients through its field staff, and he also wants to keep them safe.

Staff are feeling panicked. We are providing counseling through telephone calls.  Group meeting procedures are suspended. We have asked staff to deal with clients individually.  Asked to maintain healthy environment in office i.e. wash up facility, disinfectant spray, managing hot drinking water. Budget released and asked each staff to have mask, sanitizer, hand glove, soap, etc. to keep themselves protected. Asked to stay at home/ take leave/ consult doctor if any symptoms of flu are found. Branch staffs are provided mess facility where hot food is provided by designated staff.

Bashyal and the dedicated staff of Swambalamban Bank make up a team of financial first responders, meeting with their clients to help them deal with the business losses and financial shocks that come in response to the pandemic.  To stay safe, people need to stay home.  But when people stay home, they earn no money. 

That leaves Bashyal and his team trying to figure out how to bridge the gap, how to help their clients manage scarce resources long enough to survive this crisis.

Impact on Clients

All of the organizations that responded the survey report reduced business activity for their client.  More than 70% report that clients are having trouble obtaining supplies for their businesses.  So far, no organizations have reported cases of COVID-19 among their clients on clients’ families.

Impact on Operations

All but one of the survey respondents report that some clients have stopped making repayments on their loans.  (The other one said payments are not due till the beginning of the month, but they expect to see missed repayments then).  A few organizations (36%) have halted their operations.  To date, no organizations have reported that any staff members or anyone in their families have tested positive for the virus.

Caring for Staff

Almost all the organizations responding said they are providing training for their staff in how to reduce transmission of the virus.  Most are providing masks, sanitizer, soap and other supplies to their staff.  About half have asked staff to work from home. VisionFund of Mexico reports that it has asked its staff to stop in person meetings with clients and to follow up with them individually by phone and text instead.

Caring for Clients

More than half the respondents are also providing training to their clients in how to reduce transmission of the virus.  Many are also changing the process of their group meetings to reduce the opportunities for the spread of the virus, including:

  • Splitting groups up so that only four or five people meet together at a time.
  • Having groups meet less often.
  • Foregoing group meetings and having staff follow up with clients individually.

BRAC in Bangladesh provided one of the most comprehensive answers in response to what they are doing for their staff and clients:

Field Officers (FOs) wearing masks and hand gloves while collecting cash in groups. Putting cash in a paper envelope and destroy it after the cash is submitted to accounts. Hand wash facilities for all while entering branch offices and its a must for all staffs and clients. Low frequency of disbursement from branch. Account officer must also use mask and gloves if clients come to take or give cash. Accounts officer keeps a tissue box and covered bin in the accounts room so that if any client is found coughing, she can use that. We are giving leaflet to clients about covid19 and how to combat it. Any staff in the branch, if found showing any symptom, should be sent home immediately and they can work from home. Suspension of all client trainings both at branch and VO. If FO finds any migrant worker coming from outside the country recently, FO must encourage the person to stay at home at self-quarantine mode for 2 weeks. FOs will collect name, number, age and address of any person who shows the symptom. If local authority asks for it, FOs can provide that. In addition to this, we are sending voice messages to all our clients’ numbers. We are using our call centers to call clients and raise awareness. We are also pasting stickers in limited numbers in the clients’ houses.

As I wrote in the first post in this series, microfinance providers and promoters of savings and self-help groups reach 15% of all households on earth.   The organizations responding to the survey show how financial first responders can continue to serve their clients in the midst of a global pandemic.

DSK and I are conducting interviews with some of the organizations that completed their surveys. I will be posting them on this blog starting this week. If your organization has not completed the survey, please click on this link to fill it out.

2 Comments

  1. Sonja Kelly says:

    Larry, this is fantastic. Just shared with my team at Women’s World Banking. We’re looking into business impacts among our network too. It’s so useful to have data on how institutions are responding–both to create a sense of community and to offer examples for other institutions to follow. Stay well in these strange and vulnerable times, friend.

  2. Shams Azad says:

    Thanks for the initiative Larry. The is very much helpful. These are the times we all should let others know how to tackle the situation on ground with our front line staffs and the clients that we serve. From Today BRAC has started loud miking on the streets all across the country – playing an awareness song on covid19 by a famous local artist. These things work well in a country set up like Bangladesh.

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