Visitors climbing the stairs of a Kabul office block are met with an unusual sight for a bank in Afghanistan.
The cashiers, advisers, manager and customers are all women. Moreover the Finca branch is buzzing with a hum of chatter more like a social club than a sober financial institution.
The busy women-only branch in a central suburb is part of an experiment giving more women access to loans in a country where many are shut off from work and finance. Tiny loans of just a couple of hundred pounds have allowed women to set up and grow businesses, or pay off emergency costs.
Such micro finance loans not only help development, advocates say, but could also be key to helping poor communities bounce back after the economic devastation wrought by Covid-19.
Experts say giving women access to banking and the opportunity to save, send and receive money can lift whole families out of poverty.
The branch only opened in 2018, but has rapidly become a success because staff have found women are more reliable customers, said Ali Rawnaq, chief executive of the bank in Afghanistan.
Where a typical branch might become profitable in 12 to 16 months, the women-only branch broke even in nine months. Staff have found women are 50 per cent less likely to default.
Many women customers had previously found dealing with a normal bank branch difficult, Mr Rawnaq explained. Even in the comparatively cosmopolitan capital city, husbands were sometimes reluctant for their wives to interact with male staff without their faces veiled.
“We have customers who were coming in other branches and they were covering their faces. It was very difficult for us to understand them. In many cases, the counter teller is a man, the guard is male, the branch manager is male, it’s very difficult for them,” he said.
Fearing they would lose custom unless they made it easier for women to interact, they decided on the all-female branch.
“Now they come here, they are talking to the cashier, they open their faces, they are sitting here, they are talking to each other, they are sharing their experiences,” he said.
The other obstacle to women taking out conventional loans was they were unable to provide the necessary guarantees. Few women have property in their name, or can get a guarantee from a businessman such as a shopkeeper.
The solution has been to offer group loans where a syndicate of friends guarantee each other.
“If one member of the group is absent or defaults, the rest of the group either they must convince the customer to pay, or they will pay on behalf of the defaulting customer,” Mr Rawnaq said.
“They know each other much better than we do. They introduce people with good character. That’s very important for us. Right now we have around 3,000 group loans.”
Other little details also had to be smoothed out. The previous loan process had required a photograph, meaning women customers would have to go a photography shop to get a passport picture taken. That too was unacceptable for some families. Female loan officers can now take a digital photograph on a tablet.
If a woman is married, she still needs her husband’s signature. A widow or unmarried woman needs a father or brother’s signature.
The branch manager, Shakila Shewa, says the money has transformed the prospects of several of her customers. Her favourite example is a woman who borrowed 10,000 Afghani to buy raw materials for her home-woven carpet business. The woman now has 12 workers.
“Women know the problems of women,” said Ms Shewa. “They are more honest mostly than men. They pay their loans on time. This special branch is very beneficial for them.
“When they go to other branches, they can’t uncover their faces, or speak freely to other men, because of the limitations put on them by their families. But here there is not limitation, they can tell their stories to the women, not to men,” she said.
Loans for small home businesses, such as catering and tailoring are common, along with loans for home improvement, or emergency medical costs.
Zar Wardak, vice president at Finca, said giving women access to economic power could have a “tremendous” effect. Women could not only stabilise their own finances, but were also increasingly given a say in household decision-making.
Such lending could also help the world’s poorest recover from the damage inflicted by the coronavirus pandemic, said a director of a UK charity providing similar loans in Pakistan.
The British Asian Trust, founded by the Prince of Wales, gives interest free loans to small businesswomen in Sindh and Punjab.
“Coronavirus is a health crisis and an economic crisis,” said Sarah Dunn, director of programmes.
“In Pakistan entrepreneurs and small business are the driving force of the economy and it’s vital that women are supported to be part of this ‘engine.’
“Helping women to help themselves through developing an income is going to be crucial to building things back again”.
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