WILSON Moleni is on his first trip to the UK. And what a first visit it is: he is dining with royalty, meeting dignitaries and briefing journalists. Not bad for a man who grew up among Malawi’s poorest, and who (most of the time) had just enough food to continue to go to school.
Moleni, 38, is here to promote the work of Opportunity International, an organisation that provides microfinance to the poor in the world’s poorest countries. In Malawi, under his watch, the bank has reached 270,000 people and helped them to set up micro-businesses. Moleni joined Opportunity International Bank of Malawi (OIBM) in 2003 just before it opened to the public and is now regional manager for the northern region, the country’s poorest, and is a distance MBA student at Oxford Brookes.
Wilson’s story is a tale of uplifting and amazing success in a country where the life expectancy is 53. “I grew up in a poor family with five brothers,” he says. “My father was a peasant farmer, so he grew food just for the family. Any surplus went towards school fees. But sometimes we had no food. So I can easily understand the position of the people who come to us for loans. I’ve been there.”
Moleni’s father worked for a time at a factory in Zimbabwe and had seen what education could do for people. “He kept saying: ‘I’ve seen education work’ and kept encouraging us to go to school, even when we were hungry.” It paid off: Moleni’s brothers are teachers, a financer at a different microfinance institution and an accounts officer. “Our parents are alive and have forgotten their poverty because we are able to look after them,” says Moleni.
The challenges Malawians face are enormous. “A big problem is that there are no role models to show the benefits of education. Many people don’t know anyone who has excelled in life through school.” There are also serious holes in basic knowledge – not just about economic basics such as supply and demand, but also health, hygiene and HIV, which OIBM seeks to address too. Clients also learn about the basics of borrowing, interest and debt, as well as economies of scale. If a person makes doughnuts to sell at the market, she will learn about buying corn in bulk to increase profits.
To open a bank account in Malawi, you need a driving licence or passport, which most people – particularly women – do not have. “Most people have not even heard of banking,” says Wilson. “They keep their money under a pillow, or in the ground where people can steal it and animals eat it. They have no concept of saving for future events or school fees.”
SMART CARDS AND SMART WOMEN
This is where OIBM’s genius comes to the fore. At its core is cutting-edge technology, the star of which is smart cards. Instead of using ID, clients have cards with their fingerprint stored on a chip. “This has helped everyone to open an account,” says Wilson. “And only the borrower has the smart card and access to his or her money.”
What is most striking about OIBM is its appeal to and support of women – 80 per cent of its borrowers are female. Why? “We made it friendly to women,” says Moleni. “Malawi is very male dominated. But with smart cards, women find it easier to participate. Women are more important: they are the backbone of the society as they look after the kids as well as work. And women pay back: they are more reliable. They tend to want to put savings towards the home and the kids – that’s their priority. Men more often spend any money on a beer, then another one.” Then there’s the fact of masculine pride. “Women are not ashamed. Men are too proud to sit at the corner of the market with a little pile of tomatoes. But as women become more successful, men want to join the business too, and often end up working for their wives.” If that’s not a satisfactory result, what is?
OPPORTUNITY INTERNATIONAL: BANK OF MALAWI
Opened in 2003, OIBM operates throughout Malawi, offering a range of microfinance services to people, mainly women, whose stock may be worth as little as £20, as well as to first-time traders. Microloans, between £70 and £300, are offered alongside micro-insurance and a range of other services, such as education about basic banking, economics and hygiene.
OIBM’s revolutionary technology includes:
° Smart cards: each borrower has a card with their fingerprint on a chip, giving them complete control over their money.
° Mobile kiosks, so that even people in rural areas are able to bank.
° Cell phone banking (cell phones are subsidised by the government and cost from £2).
° Weather index: a machine that automatically calibrates how far off the predicted level rainfall has been, so that loans can be adjusted depending on crop yield due to weather.