> Posted by Jeffrey Riecke, Communications Assistant, CFI
The following post is comprised of research from three Credit Suisse Virtual Volunteers, Vipin Gupta, Kajal Shah, and Jennifer Hughes.
Most persons with disabilities (PWDs) don’t have an account at a formal financial institution. In India, 5 – 6 percent of the population (roughly 66 million) are estimated to have a disability, and three-quarters of Indian PWDs live in rural areas where access to banking services is limited. In India on the whole, about 35 percent of the adult population has a formal bank account. In Mexico, about 10 percent of households have at least one member with a disability, and about 27 percent of the country’s adult population has an account at a formal financial institution. These two countries present huge financial inclusion opportunities for PWDs. Encouragingly, significant PWD inclusion in-roads in both are underway.
In India, low financial inclusion incidence among PWDs is connected with poverty and unemployment. A meager 0.14 percent of PWDs in India hold regular jobs. This employment statistic stands in spite of efforts from the National Centre for Promotion of Employment for Disabled People (NCPEDP) mandating that 3 percent of government jobs be reserved for PWDs, and incentivizing private employers to ensure that at least 5 percent of their workforce is comprised of PWDs. The same low fulfillment of positions reserved for PWDs has been seen in several of the government’s rural employment schemes. In a study examining labor-intensive agricultural occupations in India, it was found that the majority of PWDs were not chosen by potential employers, and that PWDs in rural areas mostly depend on non-agriculture-based-self-employment as a means of livelihood. For these individuals and others pursuing self-employment, a lack of adequate capital can be a critical roadblock to earning a livelihood.
There are a multitude of factors contributing to this situation, including low education (only half of Indian PWDs have any formal education), inability to afford health treatments, un-inclusive employment settings, un-inclusive surroundings, prejudice against PWDs, lack of awareness of support programs and other resources, and geographic remoteness to banking, education, employment, training, and rehabilitation facilities. Nearly any of these factors are enough to pose large, or in some cases insurmountable, challenges to accessing formal financial services. When combined, the task of accessing traditional avenues of financing can be overwhelming. For many PWDs, the only viable source of financing is money from friends and family, but in lower-income rural areas even that is difficult to come by.
Other challenges that stand in the way of greater inclusion of PWDs in India include lack of a standardized method for defining and evaluating disability, and lack of up-to-date data.
However, India is making progress towards reversing these conditions. In 2007, it became the seventh country to sign and ratify the United Nations Convention on the Rights and Dignity of Persons with Disabilities. Previously, the Indian government enacted the Persons with Disabilities Act, with the aim of ensuring the equality and full participation of PWDs. The National Handicapped Finance & Development Corporation (NHFDC) is a major initiative of the government for promoting poverty alleviation among PWDs. NHFDC manages a number of different financing programs that support PWDs in attaining sustainable livelihoods.
Another area furthering the inclusion of PWDs in India is the development of assistive technologies. Assistive technology refers to any product, device, or equipment that is used to maintain, increase, or improve the functional capabilities of PWDs. Assistive technologies present the opportunity for financial institutions to create an environment conducive to PWD employees, as well as products and services that are accessible for PWDs.
Assistive technology options range from basic and relatively inexpensive walking canes, magnifiers, and Braille materials, to more expensive electronic devices. The user’s particular abilities dictate which assistive technology is appropriate. Among information and computing technologies (ICT), a number of technologies around image and text magnification are available for visually challenged people, audio and tactile technologies are available for blind users, and tactile devices exist for blind and deaf users. Common ICT assistive technologies include screen magnifiers, Braille displays/keyboards, screen readers, and speech synthesizers.
In 2005, India’s Ministry of Social Justice and Empowerment introduced the ADIP Scheme to assist PWDs in the purchasing and fitting of aids and appliances. The Reserve Bank of India has also supported the proliferation of assistive technologies. The RBI issued circulars to all commercial banks impressing the importance of providing all banking facilities to visually challenged individuals without discrimination. Additionally, banks have been advised to install ramps to all ATMs and to install Braille keypads to at least one-third of new ATMs. Another initiative by the Indian government is the Universal Service Obligation Fund, which includes an initiative to spread access to ICT technologies for PWDs in rural areas.
The field of assistive technology has seen considerable research and development progress in India in recent years. Many organizations, both public and private, are involved in the development and dissemination of assistive technologies throughout the country, including Barrier Break Technologies, The Centre for Development of Advanced Computing, and Media Lab Asia.
In Mexico, as mentioned above, nearly 10 percent of households have at least one member with a disability, and 24 percent of PWDs have some employment and income. Children with disabilities accounted for less than 1 percent of the 20 million children enrolled in the national education system during 2002, according to the national census.
Mexico’s government and a number of local organizations are taking action. Like India, Mexico also signed the UN Convention, and in 2011 all rights stated in the convention were added to the country’s constitution. Another significant recent government achievement was a reform of the constitution that declared that health and life insurance rates for PWDs must be in-line with all other individuals.
According to the Mix Market, Mexico’s total microfinance portfolio is roughly $4.8 billion in loans with 6.5 million borrowers, and $2.4 billion in deposits with 1.5 million depositors. To explore how to broaden these services to include more PWDs, Jennifer Hughes spoke with Ileana Lopez and Gabriel Monterubio of Fundacion Paralife. Through the conversation Hughes uncovered that the majority of ParaLife’s brand awareness and new business comes from television commercials. With an unemployment rate of 75 percent among PWDs in Mexico, television could be a viable means to help more customers become aware of microfinance services. Radio serves as a more-affordable, also effective, advertising method, Lopez and Monterubio indicate. Another efficient way to reach out to PWDs is by tapping into their existing networks – like hosting event booths, info sessions, passing out flyers, or emailing distribution lists for individuals involved in CONFE (a network of organizations defending the rights of PWDs), YMCA, and schools for PWDs.
This was just a glimpse into the research collected by Gupta, Shah, and Hughes. We’re grateful for these research contributions, and will apply them towards our work to advance financial inclusion for PWDs. CFI is working to extend financial inclusion to PWDs globally through the development and dissemination of disability inclusion tools and trainings for use by MFIs around the world. We’re also customizing and developing a roadmap for disability inclusion for the Indian MFI market, which was tested this year at Fundacion Paraguaya.
Have you read?