Success in Rural Savings: How One Donor Led the Way

In this paper, the author cites the example of Deutsche Gesellschaft fur Zusammenarbeit's (now GiZ) technical support to Bank for Agriculture and Agricultural Cooperatives (BAAC) to develop and deliver saving services to 2.3 million rural poor Thais.

The author mentions the following keys to project success:

• Properly evaluate institutions to ensure provision of safe and secure saving services;
• Design products that match consumer requirements using careful market research;
• Find ways for the donor and the local institution to share costs;
• Allow sufficient time to do it right.

The author highlights some institutional factors that account for GTZ's success:

• Results, not money: the focus is on long-term results and not disbursement;
• Timing: the process of project is at a speed suitable for partner institution;
• Project manager: the project has a trusted, authorized and accountable project manager.

Some of the key benefits to the partner institution, BAAC, are:

• Two saving products that are sustainable source of refinance;
• Increased client base;
• Reduced currency risk;
• Increased autonomy;
• Better public image.

The author concludes by stating that in spite of long gestation period of 24 months prior to the launch of product and an interim change in the basic product design (based on BAAC feedback), GTZ's modest but strategic investment in technical assistance achieved its mission.