Thousands of microfinance institutions (MFIs) operate financial and social programs in the developing world to reduce poverty. However, facility-based health programs of some MFIs in Bangladesh were found to aggravate inequalities, according to a new study by researchers at National Taiwan University (NTU) and in Bangladesh. The study has been published on March 25, 2015 in PLoS ONE.
[Photo: Ms. Yu-Hwei Tseng]
Conducted by Ms. Yu-Hwei Tseng, a PhD candidate in the Institute of Health Policy and Management at the College of Public Health, NTU, in collaboration with her Bangladeshi counterpart Mujibul Alam Khan, the study compared patients’ socioeconomic profiles and fee structures in public hospitals and MFI-run hospitals located in urban, rural and semi-urban districts in 2013.
Contrary to the target population proclaimed by MFIs, their hospitals are significantly and largely utilized by the non-poor and moderately poor. The poorest patients, including the clients of MFIs, are unable to access MFI’s hospital services due to structural barriers. The poor-rich gap in MFI hospitals is wider than that in public hospitals, suggesting worsened disparities in the former setting.
While microfinance is widely used to reduce poverty and facilitate human development, the study identifies the need to re-examine pro-poor projects using an equity lens. Researchers suggest that priority be given to universal coverage and strengthening of public delivery system over financial services.