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Binimoy is a
private initiative founded and managed by Stuart Rutherford and
supported by a small international circle of investors.
Its aim is to
encourage innovation in financial services for poor people
in Bangladesh and elsewhere. It does this through investing in small-scale
innovative financial services schemes, and through research and
publications to stimulate more widespread innovation and experiment.
Binimoy investors
buy 'shares' in multiples of £10 sterling (US$15), which may
be sold back to Binimoy at face value at any time. Shareholders
receive no financial return on their investment. Instead, they enjoy
'interest' in the form of regular brief reports on the progress
of Binimoy's work. An
example of a Report is given at the foot of this page.
Becoming
a Binimoy Investor
Binimoy Investors buy shares worth £10 sterling or US$15 each.
Please email Binimoy at binimoy@safesave.org indicating your name,
street address and email address, and the amount you wish to invest.
On receipt of payment, Binimoy issues share certificates.
The shares are not tradable, but may be resold to Binimoy for their
face value at any time. Just return the share certificate with a
written request for reimbursement.
Binimoy uses the funds in two ways:
1. The capital is invested in innovative financial services schemes
for the poor in Bangladesh.
2. The income from these investments is put towards the costs of
research and publication designed to stimulate innovation and experiment
within financial services for poor people in Bangladesh and elsewhere.
Neither capital nor income is ever used to support Binimoy salaries
(there are none) nor living costs.
Currently, Binimoy
funds are invested wholly in SafeSave. Some is invested in
the form of shares held in the main urban work, and some as a loan
to the rural pilot.
Investors receive
no financial return on their shares. However, depending on the number
of shares held, investors receive 'interest' in the form of written
reports:
1. All investors receive annually a statement of their share holding,
and a brief report of Binimoy's activities.
2. Investors holding shares worth £200 ($300) or more receive
an annual statement of their share holding, and a more elaborate
report of Binimoy's activities, illustrated with excerpts from ongoing
research and investments.
Note
from 2001 these reports have been sent by email.
Investors should note that Binimoy is unregistered . The wisdom
of their investment can only be measured by their own assessment
of Stuart Rutherford's good faith. Stuart Rutherford has had twenty
years experience working on financial services for the poor in Bangladesh
and elsewhere. He is a Senior Visiting Fellow at the Institute for
Development Policy and Management at the University of Manchester.
(IDPM is not an investor in nor associated in any way with Binimoy).
The following
example of an early Binimoy Report dates from 1994
and shows how Binimoy can have a decisive early impact on the progress
of good programmes. It refers to Ashrai, an innovative project working
with indegenous people in northern Bangladesh. Binimoy was an early
supporter of Ashrai, but withdrew as soon at it was clear that Ashrai
could attract other support. Ashrai in 2003 has grown so that about
50,000 households are members of its savings and credit groups.
| NEWS FROM
BINIMOY: JULY 1994
Binimoy invests in savings-and-credit
associations run by ethnic
minorities in Bangladesh's harsh 'Barind Tract'
In July 1994 Binimoy invested
one lakh Bangladeshi taka (approximately $2,500) in savings-and-credit
associations run by groups of village women belonging to ethnic
minorities in Western Bangladesh. About three hundred such
groups, with a total of some 6,000 members, have been running
for up to three years. They make weekly savings which they
have been lending to their own members at interest rates they
themselves set (typically 3% per month).
These associations were formed with organisational help from
Ashrai, a local voluntary body which works with Santal and
other minorities to strengthen their social organisation and
integrate them more fully into the civic and political life
of the country. Ashrai is registered with the Government of
Bangladesh.
Binimoy has lent the money to Ashrai for a term of one year,
with interest of 7.5%. Ashrai will on-lend to the associations
at 12.5% per year, using the 5% spread to help pay for its
fieldworkers who assist illiterate groups with their record
keeping. The associations will on-lend to their own members
for short-term consumption, emergency and small-scale production
needs at rates decided by them, probably 2 to 3% per month
(24 to 36% per year). The spread will enable the associations
to build up their capital more rapidly. At this early stage
loans tend to be tiny ($10 to 20) and are usually repaid within
a few months through small weekly instalments. The high rates
of interest indicate the importance they place on access to
such loans, and on building up their own savings.
This is an excellent investment
opportunity for Binimoy. It is safe, and introduces to a much
neglected group of very poor women a fresh approach to household
and village-level money management.
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