People living in vulnerable situations are often unable to access banks and formal lenders. There are many reasons - they may not have the collateral needed, or a guarantor, they may live far away from a branch, or they may lack confidence, literacy or social mobility. Millions of people still save and borrow, but they depend on moneylenders or friends and family, which can be risky and expensive.
We started our microfinance operations in 1974 with the aim of bridging this gap. Today, our financial services enable over five million people across Bangladesh to access credit, savings and microinsurance, to safeguard their finances and their futures. Our clients - the vast majority of whom are women - often use these services to start small businesses. Direct access to financial services, coupled with financial literacy training, often results in them also gaining greater decision-making power in their families and communities.
We are constantly working to ensure our services meet the changing needs of our clients. We specialize in taking ideas, testing them, perfecting them and then scaling them up rapidly, in a cost-efficient manner, and without compromising quality. Our relentless focus on getting services to the ground sees staff climbing hills to run financial literacy classes, wading through floodwater to support people and spending months helping women in remote areas to overcome the fear of using mobile money rather than cash.
This focus has meant we are always evolving. Today, families facing a sudden illness can access specially tailored medical treatment loans. Farmers facing uncertain harvesting patterns can access the seeds, fertilizer or machinery needed to help them adapt to climate change. People migrating for work can apply for tailor-made safe migration loans, which include services that check the validity of contracts and travel documents.
BRAC is one of the largest providers of microfinance in the world. Our size, combined with our services being largely digitized, meant that millions of dollars in emergency cash support was able to be disbursed to the most remote areas of Bangladesh almost instantly during the COVID-19 pandemic, as well as savings being able to be accessed, and thousands of loans being able to be refinanced. We are relentless about meeting people’s needs, and we were the first organization in the country to be recognized with Smart Campaign Certification for upholding universal standards for client protection.
This client protection lens, and commitment to excellence in delivery, is what led to the birth of BRAC Dairy, one of BRAC’s social enterprises. A large number of our microfinance clients in rural areas were investing in cattle, and, in doing so, were exposed to risks, resulting from issues such as poor cattle breeding techniques, limited veterinary services, and lack of market access for milk. The perishable nature of milk and the lack of chilling facilities meant that dairy farmers relied heavily on people who could collect and sell the milk for them, who often retained most of the profit.
BRAC Dairy serves 50,000 dairy farmers across Bangladesh, most of them also being microfinance clients, who own, on average, three cows each. The social enterprise provides them with access to milk collection and chilling facilities in the most remote corners of the country, fair prices for their milk, and services such as cattle development and technical training, vaccination and feed cultivation. The milk is turned into dairy products and sold across Bangladesh, ensuring access for urban consumers to high-quality, locally-sourced products.
We have a strict bottom line, but it is not centered on profit - the focus is on maximizing quality of life for all.
