Few banks as tiny and as recently established have been so assiduously courted as Venezuela’s Bank for Women’s Development, known familiarly in Venezuela as Banmujer.
The bank was set up by the Venezuelan government in March 2001, with an initial capital of 15bn bolivars (a little under £4m at today’s rates), which has been successively raised to 65bn bolivars. By the middle of 2005, Banmujer had made 54,484 loans. Men got 8% of them, but 92% of the tiny advances went to women. The total worth of loans made in 2004 came to no more than 9bn bolivars, but that sum, says the bank, created 47,500 jobs.
“We’re in the business of seeking our potential borrowers, poor women, that’s to say, the poorest of the poor,” says the bank’s president, Nora Castañeda, the retired former head of the economic faculty at the country’s largest university, the Central University of Venezuela.
“We don’t wait for customers to come to us, we go out to them,” she tells The Banker in her modest office, on a busy corner of Avenida Urdaneta not far from the central bank in Caracas’ financial centre.
Development role
Banmujer is in reality more a development agency than a commercial operation, which is why it has had a high level of non-performing loans and needs to be run more professionally.
Its financial activities may be no more than symbolic in this oil-rich county of more than 26 million people but the symbolism is strong. It carries the message set out in the new constitution of 1999 that the state will start doing something effective for the rights of 3.5 million women who sit at the bottom of society. Venezuela is the world’s fifth biggest oil producer and an important supplier to the US, but it is still deeply divided between rich and poor.
Mario Morales, a senior official of Professor Castañeda’s staff, explains how Banmujer studies maps of social deprivation in town and country, targets the worst areas and sends out specially trained staff to identify and encourage the poorest women and those belonging to indigenous groups to band together on some productive project.
Informed of rights
“Our bank offers them advice, training and guidance on business plans but in the last event it is they who decide what they’re going to get together to do,” he says. “We feel that rather than lending the women money, we are telling them what their rights are.”
Staff – who are always based in the area for which they have responsibility – try to achieve synergy among neighbouring groups and inform the women about the official help to which they are entitled but about which they often know little or nothing, such as gaining literacy skills.
Each member of an organised group could expect to borrow 1.5m bolivars at 12% for four years for a small commercial or manufacturing concern or 6% for a farming enterprise. When full repayment is made the group has the right to borrow one and a half times the original sum. More than a quarter of all loans are going to women aged between 45 and 64.
Unsurprisingly in a year which has been proclaimed as the International Year of Micro-credit – a speciality into which many large Western banks are trying to find their way – the patronage of foreign governments and companies is coming thick and fast. Many sponsors see the benefit of helping a small but prestigious organisation that often catches the attention of ministers and senior government officials.
Global agreements
The capital to establish Banmujer came from the state, which keeps the bank under the wing of the Ministry for the Popular Economy. Since then the bank has signed co-operation agreements with the UN Development Programme; PDVSA, the state oil company; Statoil from Norway; the German Institute for Technical Co-operation; the Japanese International Co-operation Agency JICA and US oil major Conoco.
JICA, for instance, runs a programme that takes small groups of Banmujer co-ordinators to Japan for specialised courses in the latest management theory of micro-credits, taught by Spanish-speaking instructors. Similar deals are being negotiated.
At the same time, bankers from other Latin American countries where poverty among women is a particular concern, such as Mexico and Ecuador, are following Banmujer’s lead. The Mexican state of Chiapas has recently organised its own version of the bank.
“Our aim is to make the poor stop cringing and start demanding,” says Mr Morales. In this respect, the bank appears to be having some success. “We were at the point of signing a credit arrangement with a group of indigenous women when one of them said: ‘Article 9 of the constitution says we have a right for this document to be in our language’,” he recounts, adding with a smile, “and we had to have it translated for them.”
