The European Union and the French government will put about US$1.3 million into a project to establish savings cooperatives in Karen State, in an attempt to address poor access to financial services in one of Burma’s most remote and poorest ethnic states, a statement said.
The statement Wednesday said a total of 965,509 euro would be spent on the three-year project—with the European Union providing 82 percent of the money and the rest coming from Agence Française de Développement, France’s international development agency.
The project, titled “Supporting Financial Access via Cooperative Upgrading and Enterprise and Farm Development in Kayin State,” will be implemented by PlaNet Finance, an international microfinance development NGO, working with Burmese group the Community Development Association (CDA).
“The project will establish three savings and credit cooperatives to provide financial inclusion to at least 2,000 households in 30 villages in Hlaingbwe Township [Hpa-an District] where currently no financial service provider operates,” read the statement.
“With these cooperatives in place, it is expected that farmers will have a safe place to save in order to increase income and build wealth in this post-conflict area of Myanmar.”
Karen State has suffered from decades-long civil wars, due to which thousands of villagers have been displaced. Many families have less than $1 per day for food. More than 140,000 people from the state have fled into Thailand, where most have lived in nine refugee camps on Thai-Burma border for more than two decades.
A recent UN study found that very limited access to financial services across Burma, with only 4 percent of the population holding a savings account with a bank. As a result of this and other barriers to saving, the survey said, 62 percent of people in the country do not put any money aside.
This week, PlaNet Finance is holding training on how to implement the project with participants including CDA staff, officials from the Burmese government’s Cooperative Department and Small-Scale Industries Department, and representatives from the Union Cooperative Syndicate of Karen State.