Scars run deep in the lives of the poor who are caught in the debt cycle, thanks to numerous microcredit lenders in the hinterlands of Bangladesh. Rural poor are being forced to sell of their organs, in return of ready cash that is used to repay the debts of the mirco-lenders.
Bangladesh is one of the world's most densely populated countries with 161 million people, 31 percent of whom live below the national poverty line. As the microcredit system grew during the 1990s, it was heralded as the panacea for millions of the poor. However, access to credit was only one part of the story as people took loans one after the another, sometimes one loan to repay the previous one and ended in debt cycle from which it became difficult to escape. This situation left some people with no choice but to sell of their organs in return of money.
In a small village near Joypurhat in northern Bangladesh, Selina Akther, sold a kidney to repay her husband’s microcredit loans and now has to endure a lifelong pain and the scorn of fellow villagers. Her husband, brother-in-law, and father-in-law also each sold a kidney.
Another victim, Mohammad Akhtar Alam, 33, bears a 15-inch scar on his stomach where he had a kidney removed. The organ removal - has left him partially paralysed, with only one eye working and unable to do any heavy lifting.
Monir Moniruzzaman, professor at the Department of Anthropology at Michigan State University who has been researching the organ trade in Bangladesh for 12 years says some people feel they are left with no choice but to sell a body part.
His research, based on personal interviews conducted over the 12 year period, reveals that the microcredit institutions and NGOs such as Grameen Bank and Bangladesh Rural Advancement Committee (BRAC) pressurize their borrowers into repaying loans by verbal harassment, threatening and their constant follow-up.
Organ transplant is illegal in Bangladesh unless the organ is being given to a spouse or family member - combined with the inadequate post-operative care he received. Middlemen and doctors who are part of this underground web forge documents to represent family connections between the donor and the recipient of the organ. The poor and heavily indebted are lured into the trap of the middlemen’s promises and when they have their organs removed, they are delivered only a paltry amount of what was promised to them.
For a kidney transplant, the amount varies from 200,000 to 400,000 taka while for a liver, the donor is promised anything from 500,000 to 700,000 taka (1$=70 taka).
Meanwhile, Grameen Bank, the pioneering institution in the field of poverty finance is now serving 2.6 million borrowers with 95% as women. All it clients at the time of their first loans were among the poorest.
A study examining the economic effects of Grameen on the life of its borrowers compared the situations before– and after, with– and without– Grameen. It considered the effects of Grameen operation on capital accumulation, employment, and income and poverty alleviation. The study found that 31 percent of the borrowers reported themselves as unemployed before joining Grameen. The microcredit institution created new employment for them and especially for the female members who were earning nothing before. The effect of micro loans on reducing unemployment is impressive. The borrowers were found less underemployed than before. More than 91 percent of the borrowers in the survey area reported that Grameen Bank had made a positive contribution to their standard of living.
Another study by the World Bank conducted for the period 1990-2208 found that profits from Grameen-financed businesses were increasing borrowers’ consumption by 18% per year, and that the percentage of Grameen borrowers living in extreme poverty reduced by 70% within four years of joining. According to a survey conducted by Grameen Bank the cumulative percentage of borrowers who have crossed the poverty line until 2002 was over 46%.
In addition to the big players such as Grameen Bank, BRAC and ASA, nearly 700 smaller non-governmental organisations are engaged in micro finance activities across the nation. Together they serve in excess of 30 million rural people, mostly women. These organizations employ well over 100,000 people. According to the Micro Credit Authority, Bangladesh's regulatory body, micro finance accounts for 3% of the nation's GDP.
Although aimed at creation of employment generating assets for the poor, the small amount of loans taken is not always invested in income-generating activities. They are often too small to create capital base and mostly lead to creation of debt cycle for the borrowers. The borrower takes a first loan and then to repay it, a second and third.
Officials from the microfinance organizations deny of any pressure on their borrowers for repayment. Throughout the microfinance sector, the interest is calculated on the declining balance. However, there is no systematic way to check the overlap in the number of loans taken as the amounts are very small. On the other hand, the microcredit system has led to expansion of the organ trade which existed before microfinance came into scene. This illegal trade traps in its bait the poor who are left with no other option but to sell of what they have.
When the microcredit model was brought into existence by Nobel laureate Dr. Muhammad Yunus, this was not what he would have imagined the result would be where the poor borrowers have to pay a heavy cost of their borrowings, as they are land into one trap to escape from another.
