ASA, Shafiqual Haque Choudhury, and his pledge

  • ASA thought the Grameen five-members grouping was too complex, so they didn’t follow it. For each 1,000 taka borrowed, clients made 46 weekly payments of 25 taka (i.e., 15% flat rate). The loan size was the unit of 1,000 taka. All members were required to borrow the same amount. Savings were compulsory and standardized at 5 taka per week. By making it simple, it was easy for loan officers to keep records without mistakes. Tracking the target numbers was also very easy.
  • Each branch had 4 loan officers and 1 branch manager and 1 messenger who can also cook. The branch office had dormitory rooms in which the whole staff reside, thus not necessitating security guards. An ASA branch looked after a smaller number of clients than Grameen did, so it was easy for loan officers to visit clients whenever they needed.
  • There was no regional or zonal office. They had HO and branches only. The simple and rigid products didn’t need inspections. It was an “unusual combination of extreme decentralization with extremely limited discretion.”
  • Unchanging vision and mission. Though ASA had changed its activities considerably in the first decade, its objective remained the same. They didn’t work for financial inclusion per se — rather they worked to uplift people’s lives and make a better society.
  • Simple and replicable business model made by the innovative founder. The simple model didn’t require well-educated college graduates to run the business. After 10 days of training, the young local-hire staff were able to run the business comfortably. Their core product, the simple 46 weeks loans, lasted very long thanks to its simplicity. They didn’t need computerization until 2008 because of the robustness of the business model.
  • Generous donors who supported ASA in the early days. Perhaps ASA was lucky. These days, it is very difficult for MFIs to obtain large-scale grants, and they instead need to rely on shareholders' capital. That might be one challenge that the entire sector is facing.



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Founder & CEO, Gojo & Company, Inc.