Microfinance to cut poverty: analyst

Microfinance has contribution in eliminating poverty, said Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue.

Poverty alleviation will be sustainable if micro borrowers are engaged with skill development and income generating work, Rahman said in a discussion styled 'Microfinance and social safety in Bangladesh', held at the Bangladesh Film Development Corporation yesterday.

The event was organised by the Debate for Democracy, a non-profit non-government organisation that tries to improve the quality of life through debate, dialogue and development talks.

The main problem of microfinance is that borrowers take loan from several institutions at a time and they tend to pay off one microfinance institution's loan by taking loan from another one, Rahman said.

“Microfinance has both positive and negative aspects,” said Hassan Ahamed Chowdhury Kiron, chairman of the Debate for Democracy.

It is said that the poor are losing everything due to the pressure to clear their microcredit loans but there are success stories too, he said.

He also said the government's social safety net programme is facing obstacles in implementation due to corruption.

The well-off people are the true beneficiaries of the safety net programme as opposed to the poor, he said.

University of Asia Pacific won the debate competition defeating Eastern University. The participants were awarded crests and certificates.