Combatting the Vicious Poverty & Poor Health Cycle:

Integrating Health and Microfinance

Presented by: Elizabeth Carosella

Partners for Development June 2014

www.pfd.org

Partners for Development (PFD) • PFD is a U.S.-headquartered NGO that

works to improve quality of life in partnership with vulnerable & underserved populations.

• True to our name, we partner with and build the capacity of local organizations to design, implement and monitor development programs in Africa, Asia and Eastern Europe.

• Core practice areas: public health, agricultural development, enterprise development, and microfinance. Capacity building is part of everything we do, and we integrate programs to the greatest extent possible.

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• We are working in multiple regions of Nigeria, having maintained an integrated program there since 2000.

The Poverty-Poor Health Cycle • 100 million people fall below the poverty line each year due to

large or unexpected health expenditures. Many of those already living in poverty continue to go untreated because they cannot afford to seek health care.1

• Poverty leads to poor health. High costs of transportation, services and commodities prohibit the poor from accessing care.

• Poor health leads to poverty. Families are forced to sell productive assets to cover healthcare costs.

• In much of the developing world, both are correlated with low levels of education and cultural norms that further impede women from accessing a range of services.

1. “USAID’s Global Health Strategic Framework: Better Health for Development.” USAID. 2012 – 2016.

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Women are at the Center • With urban migration

(primarily men), women have more household responsibility, yet face deteriorating earning potential due to limited access to financial services.

• Poor, rural women are already

at increased risk of maternal health complications,

malnutrition, and a range of diseases including HIV/AIDS.

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• According to the World Bank, “maternal deaths are both caused by poverty and are a cause of it, with the costs of childbirth often the single biggest cause of casting a family into poverty.”

Intertwined Challenges Perspective Challenge

Health • Costs of clinical care, drugs, and transportation to health facilities are prohibitive

• Financial burden of illness leads to reductions in women’s and children’s health and education

Financial • Clients’ redirection of loan capital to cover health-related costs • Reduced productivity when a client or family member is sick or disabled.

• Delays in loan repayment • Inability to repay loans resulting in default • Poor performance of clients’ businesses • Poor attendance at microfinance group meetings, undermining of

the solidarity of the microfinance client group.

Reaching the very poor

• Health service outreach to the poor is a significant challenge, especially for stigmatized issues

• Questions about the effectiveness of microfinance in reaching the

poorest of the poor, rather than the “economically-active poor”

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Mutually Reinforcing Components • FROM A FINANCIAL PERSPECTIVE:

• Healthier clients more economically productive, better able to repay loans, more likely to repeat loan cycle

• Decreased likelihood that clients divert capital away from productive purposes to cover health costs

• Increased attendance at group borrower meetings • Increased client loyalty and boosted market share for MFIs

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Mutually Reinforcing Components FROM A HEALTH PERSPECTIVE:

• Incorporating access to finance enables clients to overcome major cost barriers to service access.

• Regular access to the poor, increasing the ability to extend service outreach.

• Regular group meetings are service delivery platforms for education, training, and dialogue

• Creates unique spaces to foster social and behavioral change. • One-on-one meetings between borrowers and credit officers are

opportunities for individualized exchanges, and even direct service provision.

• Regular community-based and context-appropriate meetings engages male partners as well as community and religious leaders

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Growing Body of Evidence • MICROFINANCE INCREASES DEMAND FOR CLINICAL CARE

• Microfinance, without integrated health services, increases the demand for formal healthcare among women (Nanda 1999).

• INTEGRATED HEALTH FINANCING APPROACHES STRENGTHEN SYSTEMS

• Clients enrolled in a micro-insurance scheme implemented through MFIs, “credit and savings organizations,” and traditional groups in Ghana were more likely to seek treatment for malaria before hospitalization became necessary (Blanchard-Horan 2007).

• SUPPLY-SIDE INTERVENTIONS IMPROVE PERCEPTIONS OF QUALITY OF CARE AND HEALTH-SEEKING • Improvement in clients’ perceptions of quality of care provided by private

midwives who received business skills training and MFI loans in Uganda. (Agha et al. 2004).

• Positive impact of microloans to local private medical clinics, coupled with business skills training. Clients were more likely to seek care when facilities were well-stocked, clean, and conducive to private interactions (Seiber and Robinson 2007).

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INTEGRATED APPROACHES PROMOTE SOCIAL AND BEHAVIOR CHANGE MkNelly and Dunford (1999)

Improvements in maternal and child health (MCH) through unified delivery of village banking services and child-survival education in Bolivia and Ghana

Barnes et al. (2001) 32% of women who received education regarding HIV/AIDS prevention through microcredit groups practiced at least one HIV/AIDS prevention method, compared to only 18% among non-clients in Uganda

Hadi (2002) Increased knowledge of pre- and post-natal care among participants in an integrated microfinance and health program in Bangladesh

Smith (2002) Link between higher levels of healthcare and participation in an integrated microfinance and health education program in Honduras and Ecuador

Dohn et al. (2004) Higher rates of vaccinations, use of health facilities and public health knowledge among community members participating in an integrated microfinance and MCH program in the Dominican Republic

Ahmed et al. (2006) Significant increase in vaccine acceptance rates among borrowers and their families as part of, an integrated program for women’s financial empowerment, health and education

Pronyk et al. (2006) and Kim et al. (2007)

Integrated microfinance, intimate partner violence, and HIV prevention program reduced the risk of IPV and improved women’s empowerment in South Africa

De la Cruz et al. (2009) and Sherer et al. (2002)

improvements in infectious disease prevention practice through integrated microfinance and health education programs, including malaria, sexually transmitted infections (STIs) and HIV/AIDS.

Metcalfe et al. (2011)

incorporating education related to financial planning for health and use of health services increases preventative health service uptake

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Areas of Potential Impact Micro-finance

• Increased clientele base • Greater market share • Client loyalty • Marketing niche • Stronger loan performance • Likelihood of repeat borrowing

Health • Nutrition and breastfeeding • Maternal Health • Access to clinical care • Reproductive Health and Family Planning • Infectious diseases (HIV/AIDS, Sexually

Transmitted Infections and Malaria)

Cross-cutting issues

• Financial inclusion • Household economic strengthening • Women’s economic empowerment • Gender and normative change

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PFD’s Integrated Health & Microfinance Program in Nigeria • Over 10 years of partnership with the

Packard Foundation

• Goal of reaching large numbers of women of reproductive age through microcredit borrowers circles to educate and inform them about reproductive health, family planning, and preventative methods to ensure safer pregnancies and deliveries.

• Delivered information on family planning and appropriate pre- and post-natal care to more than 112,000 women to date.

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Geographic focus: • Benue • Bauchi • Edo • Kaduna • Nassarawa • Sokoto w

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Integrating Health and Microfinance: PRI 2009 - 2012

• Program related investment (PRI) from the Packard Foundation in 2009 to promote reproductive health and family planning.

• Initial capital investment of $1.5 M to MFI partner LAPO • As of 2012, this yielded $18.7 M in loans to 76,000 Nigerians • 95% female borrowers • Average loan size is $244

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Components • Delivered information on family planning and appropriate pre- and

post-natal care to women through regular borrower meetings

• Broadened the traditional understanding of family planning. • Menu of services included safe motherhood, post-abortion care,

testing and treatment of STIs, pre and antenatal care.

• Stressed education of service providers AND community members • Holistic approach that also included “edutainment”

• “Male motivators” and engaging religious leaders

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Findings

• Increased health knowledge and application

• Increased demand and utilization of health services and commodities

• Increased money management/ business skills

• Improved and extended outreach and community mobilization

• Improved commodity management and record-keeping

• Positive effect on secondary beneficiaries

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Household Impact • Beneficiaries in Bauchi saw a clear connection between an

increase in financial well being and better health care

• Women’s increased decision making authority in the home

• Husbands’ financial burden decreased

• Children attending school more consistently and families providing children with more nutritious food.

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Thank you!

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