Overlapping and Information Systems in Microcredit: A Bangladesh Perspective

This paper looks into the nature, causes and consequences of overlapping in microcredit. It proposes a simple information system that may help minimize this difficulty that microcredit has been facing in countries like Bangladesh.

Microcredit has been a strategic option in alleviating mass poverty and empowering poor people for about four decades, especially in the least developed countries. It has achieved different economic and social objectives, but has also had to face operational issues like overlapping. Study findings indicate that:

• Information problems are microcredit programs’ most challenging problems;
• Use of appropriate information and communication technology (ICT) in information systems can help minimize operational challenges like overlapping.

The paper proposes a simple web-based database that would contain only the borrower name, national identification number, loan providing organization, date of disbursement and date of last repayment to mitigate the problem of overlapping. It recommends that the system should contain only these five items of information in the initial stages. More information can be added to the system once it is well established.