HIV/AIDS -Responding To A Silent Economic Crisis Among Microfinance Clients In Kenya and Uganda
This paper examines the impact of HIV/AIDS incidence on microfinance institutions (MFIs) clients in Kenya and Uganda, and the mechanisms they use to deal with the chain of crises induced by this disease. This pandemic has worst afflicted sub-Saharan Africa, which is the home to more than 70% of HIV positive people in the world and has lowered life expectancy from 65 years to 46 years (Kenya's Central Bureau of Statistic).
The paper finds that AIDS leads to a sequence of financial stress in the affected household. The most stressful points are:
- Pre-detection and early stages, when the household uses all its means to look for a cure;
- When the patient is bedridden and a caretaker has to provide intensive care, often at the cost of his own business;
- After death when a caretaker has to take responsibilities of the family members of the victim.
The paper also finds that clients' coping strategy is to liquidate savings and protective assets first, and sell productive assets only when they have run out of other resources. The paper suggests the following for MFIs to better serve their clients in the face of the growing AIDS menace:
- Encouraging savings;
- Refining and developing products;
- Facilitating informal group-based coping strategies;
- Enabling clients to access aid that is specifically meant for AIDS.
The paper concludes with the suggestion that MFIs and AIDS support organizations can best respond to the impact of AIDS by building on their respective institutional and technical strengths.
