Nabwire Carolyn, Manager of BRAC Uganda’s Kalerwe Branch, awakens at 5:30 each work day. A devoutly religious person, she spends the first half hour of each day in prayer. Next she prepares her two children for the day. Joshua, age 4, attends pre-school and Ester, age 2, goes to day care. Carolyn prepares breakfast for the children and her husband, Joseph, who is a computer programmer and web designer. At 6:30 Joseph departs in the family car to drop the children off at school on his way to work.
Carolyn walks to the Kalerwe Branch. BRAC requires branch managers and credit officers to live within the boundaries of their branch. Given the overburdened and unreliable public transportation system in Kampala, and the fact that the BRAC work day begins precisely at 7:00 am, this is a wise policy.
On this day, Carolyn was met at the branch office by five credit officers and Mr. Emma, the branch support staff. Olive, Demali, Annette and Jackie are micro-finance C.O.’s. Ms. Raymond is a newly hired credit officer assigned to launch an individual loan program at the branch.
The Kalerwe branch recently celebrated its one year anniversary. Carolyn, Annette, and Jackie have been there since the first day.
Carolyn related to me the difficulty of opening a new microfinance branch in Kalerwe. There are about ten different microfinance institutions operating within her branch boundaries, which extend out about a three mile radius from the branch office.
BRAC follows the same procedure whenever a new branch is opened. The first step is to conduct a survey of every household in the area. Carolyn and her credit officers expanded concentrically from the office in ¼ mile increments, not missing a single residence.
The BRAC survey asks basic questions of residents to determine their relative wealth compared to their neighbors.
At the end of the day, Carolyn took her survey results to the LC1, the local elected official who oversees most activity in the area. The two of them went through the surveys and the LC1 used a red pen to check off the lowest 50% of residents in terms of wealth and income. Anyone with an existing loan from another Microfinance Institution was eliminated from consideration.
The households with the red checkmarks were BRAC’s initial target customers. Carolyn and her staff went back to those homes to invite the female head of household to an informational meeting. Their initial greetings were not always positive. Many MFI’s have operated in this area, promising much and delivering little. The BRAC staff was able to overcome much of that distrust and skepticism at the informational meetings.
Groups were formed consisting of four to five subgroups of five members each. The sub-group members were friends and neighbors who were required to guarantee each other’s loan repayment.
When I asked Carolyn about her best day as a BRAC Manager, she said it was the day she disbursed her first loan, just six weeks after opening the branch.
After one year, the Kalerwe branch is nearing full capacity. The maximum number of members served by a BRAC branch with 4 microfinance credit officers, assuming a maximum of 30 members per group and three group meetings a day for 5 days, is 1,800 members. The current membership roll at Kalerwe stands at approximately 1,400.
When I asked Carolyn about her worst day at work, she told me about the time it flooded and she had to slog through mud and flood water to reach her group meeting, only to stand on a table once she arrived.
The part of the job Carolyn enjoys the most is attending group meetings. Like snowflakes, no two meetings are the exactly the same. She finds them interesting and usually amusing. If she is having a bad day, she says she forgets her troubles at a group meeting.
Carolyn believes in BRAC. When I asked her what makes BRAC different from the other Microfinance Institutions operating in her territory, she replied;
1. BRAC’s interest rate is lower.
2. They do not ask for collateral.
3. They keep overhead down to about 10%, loaning the remaining 90% to poor borrowers.
4. They do not make members feel inferior. Members interact freely with a respectful staff.
5. The objective is poverty reduction and empowering women, not profit.
6. They loan money to poor women who have been denied credit by other MFI’s.
7. At meetings all members sit on the ground on mats in a horseshoe or circular pattern, which she believes is unique and indicative of BRAC’s spirit of equality and group dynamics.
One of Carolyn’s primary duties is to prevent loan fraud. Every afternoon and between morning meetings, she personally interviews loan applicants at home and at their place of business. On the home visit, Carolyn listens for comments from neighbors and assesses the applicant’s living conditions. She confirms the size of the family and the marital status of the applicant. Not only is she there to approve or deny the loan, she also has to determine an appropriate loan amount. Loaning too much money places an unnecessary strain on the borrower and creates a temptation to use excess money for personal purposes.
At the applicant’s place of business, Carolyn fills out a loan appraisal form as she critically examines the business. She asks questions, examines inventory, and tests equipment to confirm it operates.
Another valuable source of information is feedback from the members of the borrowing group, especially her sub-group of four loan guarantors. Although these women might be reluctant to speak publically against a loan application, they often approach Carolyn or her Credit Officers in private with their concerns.
Finally, the applicant’s credit officer conducts a separate but identical loan assessment.
After conferring with her C.O., Carolyn signs a loan approval which is sent to her Area Manager and Country Office for review. In one year and approximately 1,400 loans, the Kalerwe branch has not had a single uncollected loan.
Another of Carolyn’s major responsibilities is to train and develop her credit officers. Most BRAC employees are green; joining the company with no previous microfinance experience. Carolyn is proud that several of her C.O.’s have been promoted since the branch opened.
Carolyn attends three group meetings each morning. Her role is to observe and double check the C.O.’s work. She randomly samples five pass books against the computerized collection sheet to confirm the C.O’s entries. She also evaluates the C.O.’s conduct of the meeting, including promptness, attendance, and meeting content.
Recently, BRAC Uganda partnered with Kiva.org to raise 0% interest funds for BRAC. The Kiva model is based on “peer to peer” lending from individuals in developed countries to poor borrowers in developing countries. The model requires a digital picture of the borrower as well as a written profile of the borrower and the business purpose of the loan.
Branch Managers have responsibility for collecting this information. Carolyn has quickly become an expert using a digital camera at group meetings.
The manager and C.O.’s arrive back at the branch at about noon. They spend the next hour counting and reconciling loan repayments from the morning meetings against the computerized collection sheets.
At 1:00 pm disbursements begin. All members whose loans have been approved are scheduled for a loan disbursement appointment. The women are called into the office one at a time from a waiting room. After the member signs loan documents, Carolyn confirms her identity, signs the documents releasing the money, and records the loan in the member’s pass book. The credit officers then disburse the loan amount from funds collected that day.
After lunch, Carolyn typically conducts loan due diligence, visiting homes and businesses of prospective borrowers.
The BRAC business day ends at 4 pm. Before leaving the branch Carolyn must enter all collections and disbursements into BRAC’s proprietary RADAR program on the office computer. Next, she prints computerized collection sheets for the group meetings scheduled the following day. Once that task is complete, she returns home to her family, fully prepared for a fast start at 7:00 am the next day.