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DBSI deepens micro-credit involvement

desire to promote increased commercial activities in the rural areas of Solomon Islands and encouraged by the govern ment’s fervent support for its pro grammes, the Development Bank of the Solomon Islands has deepened its involvement in micro-credit financing by introducing a Women’s Micro-Credit Programme in addition to formalising a general micro-credit programme, to be called the Rural Communities Development Fund (RCDF). the Women’s scheme is now in pilot stage and would be reviewed this month while the RCDF is close to becoming operational.

Both schemes hope to provide for Solomon Islanders, with less likelihood

of obtaining formal credit, access to obtain finance for prospective business ideas of their own conception. Although some con cessions in terms of easing some of he lending requirements of the bank are possi ble, both schemes will try as much as pos sible to offer normal lending conditions to prospective clients.

The Bank believes that while it should be readily involved in national strategies for poverty alleviation, its intervention should never be seen to be poor. Rather the provision of credit under these programmes should, while providing access, also spawn a mindset that credit is possible when one is prepared to accept and meet the neces sary requirements.

Indications from the pilot women Micro-Credit scheme are positive. Demand for micro-loans is very high among women, the average loan size is $5,000 and mainly the kind of activities involved include sewing, vegetable farming, small retail shops, fish-marketing, poultry, and professional secretarial services. It is possi ble that with the RCDF, a similar kind of

demand will prevail as there is a general inclination to small loans

that can be repaid quickly. This is not the first time that DBSI has become involved in micro-credit. It has had experiences in the past although the results have been less than satisfactory.

The notable problem plaguing micro credit schemes in the past has been the emphasis on credit alone. Lacking any appreciable knowledge of small business management, many clients assisted under the schemes failed to manage their projects successfully. The projects generally failed and ultimately the schemes dissolved with poor credit performances. Now the Bank is placing greater emphasis on credit-plus with client training and other non-credit outlined as part of the support available to clients.

DBSI will continue to provide innova tive products and services to assist active participation in the economic development process of Solomon Islands, thus improv ing livelihoods.

This will be an integrated approach which will reflect client needs and also the corporate objectives of the Bank. ■