Three case studies

Case of Hrishipara P9 client Dipali Rani, account 0012

We wrote in March 2011: This is a poor Hindu family. Dipali is one of three sisters-in-law in the bari [homestead] of three brothers on the edge of Hrishipara. Her husband drives a rickshaw (his own) and they have girls of about 10 and 4. She is on the right in the photo, with her Shohoz Shonchoy Collector Sobha beside her.

Her P9 transaction record is remarkable. She opened in April 2007 and took the 2000 taka level loan and repaid 10 taka daily, took the 3000 loan and repaid 15 a day, and so on: now she’s on the 15k level loan and is repaying 55 daily. Her savings are 23k. She says the savings are for her daughters’ marriages unless any emergency intervenes; she can pay 55 a day even though her husband is a rickshaw driver (with unreliable and irregular income) because the loan liquidity allows them to stock up with rice and dal etc so they don’t have to spend his earnings on food. This is an illiterate and shy but wise lady. Her full transaction record is attached.

We interviewed her again in December 2011: She has continued with the same behaviour. In September 2011 she reached the 23,000 taka target savings and she withdrew that sum from P9 and placed it in another of our products, P5, where it earns quarterly interest. Her long-term plan for her savings remains the marriage of her daughter. She said ‘I’ll stay with P9 until my daughter marries’. Beyond that, she hopes that eventually they’ll be able to buy farmland. In early December she withdrew 10,000 of the P9 money from the P5 account and lent it – she thinks safely – to a relative at 3% per month interest. She told us that she prefers to save daily into her P9 account rather than into the interest-bearing P5 account, because she likes the injections of liquidity that the P9 loans gives her. That liquidity allows her both to buy stocks of basic foodstuffs, and to splurge on occasional luxuries: recently she used it to finance a family trip away to a relative’s wedding, to buy new clothes for that trip, and to have a warmer quilt made for the winter months.

In February 2014 she was still going strongly: In that month she made 23 daily repayments - one for each working day of the month. Each repayment was for 60 taka except for one of 120 taka. These are repayments on her most recent loan of 18,000 taka (US$230). Her current savings balance is 25,000 taka ($320) and her loan outstanding balance is 13,880 taka ($178). She remains convinced that this service is of great value to her and her family. 

 Case of Hrishipara P9 client Arif, account 0188

We wrote in March 2011: This young man has a tiny booth shop in the market and sells cosmetics (see photo). He is landless and determined to buy land, and sees P9 as a way of getting there. He opened an account in September 2008 and pays in 100 or 150 taka virtually every day with many larger sums on good days (often just as he is readying for the next loan).

Within that time he has saved up to or exceeded the 20,000 minimum savings target no less than four times. That means that altogether in somewhat over two years he has borrowed and repaid 38 loans with a total value of 281,000 taka (about $4k), and saved 93,658 taka ($1,337) in the process. He tells me he sees no snags with P9 – it suits him well, especially the daily collection service and the reliability: Shohoz Shonchoy has never been late in delivering his loans and savings withdrawals. The loan liquidity stocks his shop for him. His full transaction record is attached.

We interviewed him again in December 2011: Since we last saw him he has continued using his account intensively.  He pays 200 taka or more every day, and has achieved and withdrawn (in August 2011) another target sum of 23,000 taka. Altogether he has now borrowed more than 400,000 taka and saved 140,000. The cash element of the loans has gone into the shop stock and the savings into land. Thus, he has recently started renting the booth next to his, which he uses as a storeroom, both for his shop and for a wholesale agency that he has been given by a chemicals company which had been impressed by his retail sales of their products. We also learned more about the use of P9 savings for land: as each 23,000 target sum was achieved, he withdrew it from P9 and placed it first in another of our products (P7) where it earns interest, and then in a fixed deposit account at Grameen Bank where it earns an even better rate. Then finally, recently, he withdrew it all and paid a total of 200,000 taka for a rehan lease of 7 tenths of an acre of land. Under such a lease he will continue to enjoy the use of the land until and unless the original landowner repays the 200,000 taka, plus interest, in full. This is unlikely to happen, so Arif has probably acquired the land for good. Right now he farms it by placing it with a sharecropper.

Arif is modestly educated – he finished the third year of secondary education – and is very much self-made. He started his retail career squatting on a mat on the sidewalk and selling trifles, not far from where his booth now is (see picture with Arif, obscured, on the left, Manager Kalim in a grey shirt, and poorer retailers selling from mats on the pavement).

In February 2014 he was still going strongly: By the, he was using Special savings and held a Special loan as well as continuing with his basic P9 account. In his P9 basic account he repaid 18 times during February - all of 100 taka except for one of 400 taka and one pf 200 (made to catch up to the rate of a repayment a day). In P9 basic his end-February savings balance is 9,000 taka and his loan outstanding is 4,800. In his Special savings he has a balance of 17,640 taka ($226) and during February made deposits almost every day into this account. His last Special loan had a disbursed value of 30,000 taka ($285) and he has an outstanding balance of 11,000 taka after making four large repayments during the month, ranging from 2,000 to 10,000 taka. He still occupies the same shop in the market but now has another shop as well as rural land. He doesn't think he'll stop using P9 any time soon.

Case of Hrishipara P9 client Mosharoff Hossain

One of our wealthier clients, Mosharoff owns and runs a larger shop near the Torgaon hospital – groceries, clothes and other goods (see photos below). He opened a P9 account, ran it up to the 7k taka loan level (savings around 9k), then closed the account in June 2010.

Now he is back and is opening a new P9 account. His explanation is that he was busy building tin huts for rent as homes for poor people in Rajendrapur. Now he is back full-time in his shop and wants liquidity. He thinks that P9 is the way to achieve this – the loans provide frequent injections of liquidity while he is building up a large amount on the savings side. The daily collection means he hardly notices the payments going out.

He doesn’t like formal banks and distrusts MFIs. He claims he has no accounts other than his P9. He is not a client of our P5 nor P7 programme.

Mosharoff is seen in the Shohoz Shonchoy office with his collector Anwara on the day he re-opened his account in February 2011. Manager Kalim is in the background.

We called at his shop again in December 2011 but found it shut: Our staff tell us that Mosharoff’s son is being sought by the police in a murder charge, and that Mosharoff has fled the village with his son.