The prospects for a Grameen Bank type credit facility in Sabah

Abstract

Notwithstanding the failures of past efforts to provide soft loans (for example, MARA, BPU & RCS) for the lower income bumiputras to participate in small and medium business, KPD and IDS decided to carry out a joint pilot project known as "Projek Usahamaju (PU)" in Langkon, Kota Marudu. PU extends credit facilities exclusively to the rural poor using the Grameen Bank (GB) approach but with slight modifications to suit local conditions. The GB of Bangladesh has proven that the destitute are bankable, and that it is replicable outside Bangladesh as evident by the success of Projek Ikthiar, now Amanah Ikhtiar Malaysia, in Peninsular Malaysia. The first five months performance of PU has shown that the GB approach is workable with the participants in Kota Marudu. PU has already achieved its target borrowers of 100, and request from the people both within and outside the pilot project area is mounting. With this keen interest from the rakyat and the strong support of the State Government, it is felt timely at this juncture to make the neccessary preparation to establish an appropriate institution underwhich the expansion of this project could be made to the other districts.