As the 20th century draws to a close, the role of women in Pakistan is under increasing scrutiny. At the highest levels, gender issues have been, and continue to be, studied and analyzed within the overall national social, political and economic context. Pakistani women, as members of the human community, and as members of the marginalized peoples of the global and national patriarchal societies, constitute a diverse group, which despite differences of culture and c lass, is yet bound together by a commonality of issues and experiences that are rooted in the discrimination that they experience at all levels and stages of their lives. In the past years, women have been in the vanguard of initiating and organizing rela ted movements for economic, political, and socio-cultural issues. It is due to this concerted and sustained action by women themselves, that the centrality of gender issues is increasingly being recognized within the mainstream.

They comprise almost half the population of the country and are an integral part of its economy, both in the formal and informal sectors. Despite being active participants in the economically productive process, their efforts remain largely "invisible", and are not represented in economic decision making. This is compounded by discriminatory barriers which restrict their entry into the formal and modern sectors of the economy. In order to meet their subsistence needs, women in urban areas are being forced to seek economic employment, but due to the lack of their mobility, education, skills, and access to credit facilities, they have limited options. These women are doubly disadvantaged as they face social constraints as well as weak institutional support. The implications of this situation are more than that of simple inequity. Therefore, inequities that are detrimental to them (in education, income earning ability, etc.) are detrimental to society at large.

Women are vital contributors to the economic survival of poor households; the reliance of women's earnings increases with the extent of poverty, for example, a survey showed that the earnings of women in households in poverty in Kar achi comprised half of the total family income. However, the opportunities for paid employment of these women, who rarely own assets, and who are largely illiterate, is limited to agricultural wage labour in rural areas, or informal sector employment in urban centers. There are almost 3 million women in the urban informal sector in Pakistan; they represent a significant growing section of the working population of Pakistan. The informal sector absorbs surplus and unskilled labour unable to find jobs in t he modern, organized sector. Women are confined to being domestic servants, or home-based workers who stitch clothes, make lace, weave baskets, make food products and embroider. They also work in productive and service activities like pottery, leather tan ning, sports goods, brooms and brushes, garments, brick layers/brick-kilns.

In Pakistan, quantitative increases in women's economic participation have not been matched by qualitative improvements. Although, in the past ten years their share in professional and related jobs rose from 15.5 per cent to 20 per cent; proportion of female production workers rose from 4.5 per cent in mid-eighties to 9.4% in 1992, women are still faced with inadequate enforcement/circumvention of labour legislation on wages and working conditions by the employers, leading to lower paid jobs. Women often face more hurdles in the job market than men do. Poverty has a woman's face. Most of the nation's people are poor and most of the poor are women. Their greater deprivation is due to their lower status, characterized by lower endowm ent of land and productive assets, to discrimination in the labour market, and to their more limited access to economic options and social services. Against 100 males, only 16 females are economically active. Out of a total female urban population of 19.5 million, 17 per cent are active in the labour force. Of these more than three fourths are working in the informal sector, and the majority of these have no access to formal credit facilities.

The Government of Pakistan clearly recognizes that development must include an overall strategy to alleviate poverty. Any programme to alleviate poverty must focus on women who are involved in a range of economic activities in the informal sector. Easy access to micro-credit by women has been a major constraint.

The Government of Pakistan has made significant efforts to increase urban women's access to credit through formal institutions like the First Women Bank (FWB) established in 1989. The bank is controlled, managed and run by women an d caters specifically to the special banking needs of women. It offers traditional and non-traditional credit and banking facilities. Through a special fund provided by GOP the bank offers a special low rate of mark-up and no collateral for loans upto R s. 50,000. Approximately Rs. 30 million from the special fund of Rs. 48 million has been disbursed. However, a glance at credit figures of FWB reveals that only 16 percent of its own resources were disbursed in 1995. Such significantly low absorption of its funds can be attributed to weak institutional capacity as well as ineffective linkages with the target communities. FWB is improving its out-reach to women in rural areas through the assistance of NGOs.

The National Report prepared for the Fourth World Conference on Women held in Beijing (Sept. 1995) pointed out the ". . . absence of integration of gender issues into the mainstream of economically "important" sectors, such as agric ulture, trade, industry, production . . .". The report states that there is a need for increasing women's access to credit through various measures. These include introducing special windows for lending to women at all banks, networking with NGOs to id entify female borrowers, simplifying the loan application and sanctioning procedures, hiring female field staff to extend the outreach of financial institutions, using alternatives to land and asset-based collateral, training and reorienting both the male and female staff of financial institutions in innovative delivery mechanisms for reaching female borrowers, particularly low income women. The Report further recommends carrying out gender impact analysis of micro-economic policies on women and improved access to productive assets.

The Government has formally endorsed the Platform of Action, an outcome of Beijing conference, emphasizing the importance of strengthening women's access to credit and capital on appropriate terms equal to those of men.

Based on the Platform of Action and the National Report of Pakistan the Mid-Term Review (MTR) of UNDP has identified Gender as one of the three main programmatic areas for UNDP Pakistan. Emphasis of gender program will be on reduci ng existing gender disparities through support for economic, political, and social empowerment of women. Empowerment of women is seen as a two fold process. Firstly, the process of her own awareness of her potentials, capacities, rights. Secondly, workin g towards an enabling environment which allows her to participate actively and equitably in all spheres of life.

In order to identify strategies for development of specific project proposals, under its Gender Programme in Pakistan, UNDP, in collaboration with the government conducted a series of participatory workshops with representation of t he various stakeholders. Based on the recommendations of the workshop on economic empowerment of urban women, a Women in Urban Credit project is being proposed with the overall objective of strengthening mechanisms for women's easy access to credit facili ties and the utilization of these for micro-enterprise development.

Although a majority of donors in Pakistan are supporting programmes for women's development, support for provision of credit facilities to urban women is minimal. Majority of the programmes cater to "income generati on" focusing on rural women. In the past, UNDP interventions have focused on "WID integrated" approach. Support has been provided in the areas of gender-sensitization, training, and data collection.

Some donor agencies like CIDA, SDC, NORAD, and JICA have supported entrepreneurial training programmes for female entrepreneurs with the First Women's Bank (FWB), a non-traditional banking facility, offered by this institution which is engaged in the disbursement of traditional credit to women. UNICEF has provided support to FWB for staff salaries. ILO is also providing assistance for skill training for increasing women's employment opportunities. Credit for micro-enterprise develop ment is an emerging area for World Bank support. The World Bank and KFW, a German bank have recently extended a credit facility of $26 million and DM6 million respectively for the promotion of micro-enterprises particularly female entrepreneurship in Pak istan.

In December 1996 UNDP and Government of Japan entered into a Multi Bi-Cooperation agreement. In subsequent consultations credit for women was identified as one of the areas for mutual cooperation. In March 1997 a meeting of Multi Bi-Cooperation on Women and Credit Project was held attended by First Women Bank, UNDP, JICA, OECF and the representatives of Japanese Embassy. The Japan WID Trust Fund with UNDP is a potential source for resource mobilization for the Women in Urban Cred it Project.

A number of NGOs are successfully implementing credit programmes for urban and rural women, but their impact remains limited to certain areas only. In the former, the Orangi Pilot Project, for example, has been implementing a credit programme for the women of Orangi (Karachi) and has demonstrated positively that women are credit worthy, despite the fact that they own no assets and are illiterate. In the rural areas of different provinces, apex NGOs such as the AKRSP, NRSP, BRSP, SRS C and SUNGI have proved well beyond doubt, that women are credit worthy. In major urban centres such as Karachi, credit for micro-enterprise development is also being provided to urban women through the concept of leasing, which is fairly new.

At present, there is no intervention for providing credit facilities to urban women through an integrated approach, comprising capital, training, and marketing channels.

A number of studies have identified the importance of providing credit as an entry point in mobilizing communities. By doing so, the Government will be unleashing a powerful wealth creating resource for disadvantag ed and poor women. Access to financial resources by low income women is a key factor in human development. Experience shows that when female entrepreneurs and producers gain access to responsive financial services at market rates, they save, repay their loans and use the proceeds to invest in health, education and housing of their families. With access to productive resources, low income women gain more and broader choices and increased capacity to reshape society. Financial institutions/banks provide ne xt to no financing for this group. Non-traditional specialized intermediaries, including NGOs, reach less than 2 per cent of women.

Credit has also been disbursed through NGO programmes but the outreach of these organizations is limited to certain areas only. The FWB is one bank which has been experimenting with credit disbursement to NGOs in Sindh on the basi s of institutional strength and a good track record. Effective institutional links geared towards increasing micro-credit disbursement and reducing the formidable administrative costs, need to be forged between the FWB, other public and private sector ban ks who offer micro-enterprise credit and apex NGOs with good credit models which can represent the interests of smaller Community Based Organizations (CBOs).

Over the past ten years, credit disbursing NGOs, specialized financial institutions and some non-traditional banks in developing countries of the region have demonstrated that financial and business development services can be provi ded to low-income women in responsive and sustainable ways. Experience has shown that to be responsive to the needs of low income women, financial services need to provide an informal banking atmosphere; small, short-term loans; non-traditional collateral requirements; simple application procedures with rapid turnaround; flexible loan requirements; ownership and mutual accountability; convenient mechanisms for small savings accounts; participatory lending and savings structures; and participatory manageme nt of institutions.

Some successful examples of non-traditional financial institutions in Asia, include the Grameen Bank in Bangladesh, SEWA Cooperative Bank in India, and the Kupedes-Simpedes programmes of Bank Rakyat Indonesia (BRI). Each programme h as shown that low-income women are excellent savers and borrowers when financial services respond to their needs. These low-income women have demonstrated that they want rapid and permanent access to credit, not temporary subsidies.

Economic empowerment of women in Pakistan requires improved access to, and control over productive resources, including knowledge, credit and marketing channels. Formal credit and savings programmes respond directly to the demands o f the women and are an important means of increasing their control over income and access to resources. This reduces incidence of informal credit (borrowing from middlemen/shopkeepers/relatives, who charge excessive interest rates). Because of their exist ing high-level participation in the small-scale informal sector in urban areas, credit for micro-enterprise development for women is seen as a dynamic and hitherto, neglected aspect of the economy. It becomes an important way of addressing the problem of poverty and achieving sustainable human development. Stimulating female entrepreneurship is seen as having important "trickle down" effects on wider poverty alleviation and gender disparity through the expansion of female employment and stimulation of the economy. Empowerment of women and skill training results in formation of social capital, which is crucial to sustainable human development.

There is a compelling need to adopt an integrated approach to raise the productivity and income of urban women by improving their access to a combination of related inputs, including credit, training, and marketing channels. Pakist an is experiencing the fastest rates of urbanization in the developing world (an estimated 4.5 per cent annually), which may reach unprecedented heights by the turn of the century. This has led to a breakdown of a range of urban services, impacting on pov erty and the general quality of life. Further, the World Bank estimates that more than two-thirds of Pakistan's GDP originates in cities and towns.

UNDP fully recognizes the empowerment of women as an integral part of the sustainable human development paradigm and has adopted advancement of women as one of its foci. Micro-enterprise development is seen as a dynamic aspect of the economy for addressing the problem of poverty and achieving sustainable human development.

UNDP followed a participatory process in formulating the PA document and for the endorsement of the proposed interventions. A series of meetings were held with the concerned agencies which included Ministry of Finance, Ministry of Women’s Development & Youth Affairs, First Women Bank, Khyber Bank, UNDP, ILO, JICA, World Bank, OECF and several leading NGOs etc.

Whereas, the Women in Urban Credit project is intended to be nation wide, initially, two urban pilot project areas need to be identified in Karachi and the Rawalpindi/Islamabad area.

The project will focus on four major problem areas which have been identified during the course of workshops and are outlined below:

Credit for micro-enterprise development, and, therefore, self-employment, defined as a sum of between Rs. 2,000 to Rs. 25,000 is not easily accessible to women for a number of reasons, socio-cultural as well as econ omic, some of which are identified below. It has to be acknowledge that the traditional image of formal credit institutions presents a formidable psychological barrier for women of the lower income group. Secondly, poor women lack assets and collateral ag ainst which money for income-generating purposes can be borrowed. Secondly, the formal procedures for borrowing loans which are prevalent in most banks today, are overwhelmingly cumbersome, complicated and legalistic, thus, creating unnecessary barriers f or female as well as male borrowers. Thirdly, there is a dearth of female professionals in the field of finance and banking. Banks are, thus, pre-dominantly male domains which female borrowers are likely to find inhibiting. Most banks do not operate speci al windows for women.

The low absorption rate of the FWB's funds has been referred to earlier in the document. According to the President of the FWB, mobilizing funds through commercial banking is not a concern, but only twenty-four per cent of these funds are re-cycled into lending, that is, at regular interest rates. This is in spite of the fact that loans of up to Rs. 50,000 can be borrowed without collateral provided, the borrower's application can be supported by two personal guaran tors. That is, nearly eighty per cent of the FWB's regular funds remain unutilized, thus implying that the bank does not reach female entrepreneurs.

Additionally, the FWB has been given a special fund of Rs. 48 million by the Ministry of Women Division for disbursement to women of low-income groups at a concessional interest rate. Although Rs. 38 million of this fund has been utilized, the FWB has neither exhausted the entire sum, nor demanded that it be increased.

Some of the constraints faced by the FWB are directly related to the fact that as an institution, it is earmarked to cater for female entrepreneurs. The FWB has a total of thirty-eight branches, primarily concentrated in urban and semi-urban areas. Out of these, trained and motivated personnel are concentrated in the three major cities of Karachi, Islamabad and Lahore. Not only is it difficult for the management of FWB to attract qualified and trained female staff to smaller citie s and towns, but the bank suffers from a quick turnover of qualified female bankers who are attracted by better remuneration in the private banking sector. This makes it impossible to open new branches of the bank for which the staff requirement amounts to seven years of on-the-job training, a capacity which the bank lacks. Furthermore, the government has banned any recruitment of new posts in the public sector. These factors constrain expansion and outreach to more female borrowers.

Other banks which have special windows for women include the ADBP which disburses credit in the rural areas and RDFC. The low absorption capacity of the special ADBP credit line is evident from the small number of loans disbursed to women, which, to date amounts to a country-wide total of merely seven thousand. The RDFC has a pilot project known as "Industrial Credit for Women" in Attock and Chakwal which offers a concessional interest rate. This, however, is under-going a review.

Generally speaking, small loans are not favoured by any of the banks which have micro-enterprise credit disbursement schemes. This is basically due to the prohibitive administrative costs involved which make such schemes commerciall y unfeasible. Unlike banks and DFIs, some NGOs, particularly the apex ones, have organizational structures and credit models, usually linked with group savings, which are well-equipped for micro-loan disbursement. The FWB has, in fact, attempted to disbur se funds through NGOs in the Sindh. The challenge is to link together the comparative advantage of the institutional strength of NGOs with unutilized funds of banks and DFIs, particularly those available on the basis of personal guarantors as opposed to collateral.

Currently commercial banks are willing to lend micro-credit to NGOs at the prevailing market rate of 18%. The intermediary NGO/Groups incur administrative costs of approximately 3 - 4% in the process of loan disbursements, wh ich, if added on, would end up costing the already poor and disadvantaged borrower close to 22%. Thus, the exorbitant interest rate itself becomes an impediment for borrowers. The banks could lend to NGOs at a concessional rate of 14% for onward lending at commercial rate of say 18%, thus allowing room for NGOs to recover their administrative costs of credit disbursement. Initially the Government of Pakistan requires to be convinced to under write the additional costs to banks i.e. 4% difference between commercial rate and lending rate to NGOs or alternatively provide special fund for the purpose to banks at special rates as has been done in the case of First Women Bank. Subsequently the commercial banks will realize the benefits of reaching the rural communities through the intermediary NGOs. Not only will they reduce their loan disbursement and monitoring costs but significantly improve the rate of loan recoveries and would thus be willing to lend out to NGOs at a reduced rate of markup. The banks average recovery rate is in the region of 90% while NGOs operating credit schemes have a reported recovery rate of around 97%.

An alternative source of funding for low income women could be the use of community savings as collateral. A legal framework regarding the contractual agreement arising between the community, the CBO or NGO in whose custody the sav ings are and the bank, has to be formulated.

Negative cultural mis-perceptions about credit can exist at the grassroots level, where it can occasionally be confused with lifelong indebtedness or bondage. Some women, particularly of the lower-income group, ten d to be apprehensive about loans while simultaneously realizing their critical importance. While ensuring that proper conduits of credit disbursement are in place, the project also needs to address the other end to the problem, that is, the lack of entrep reneurial skills and knowledge about credit utilization at the grassroots level.

The under-utilization of FWB loans for productive purposes amounts to striking evidence of the lack of entrepreneurial skills among women of other income groups as well. The under-representation of female entrepreneurs in the middle -income group also needs to be addressed. Apparently, there is considerable room for expanding credit demand in the middle-income group level by encouraging and supporting women to undertake commercial ventures..

Diverse information gaps with regard to women and credit exist at all levels, and within and between institutions at the public sector, donor agencies, private banks, and NGOs.

Quantitative, gender disaggregated data, does not exist either in public sector institutions, private banks or NGOs, for that matter. This means that figures regarding women's share and access to credit are difficult to obtain for p lanning purposes, or identifying trends. There is an urgent need to ensure that, as a matter of policy, gender-disaggregated data is collated across the board.

With reference to qualitative and in-depth studies, hardly any literature exists in relation to an assessment of the currently available micro-enterprise credit schemes from a gender perspective. To date, there is a very small numbe r of scattered and disparate studies, usually confidential, and mostly commissioned by donor agencies. These include two studies sponsored by UNIFEM in 1993/94, one being a review of existing credit programmes, both at the public sector and GO level. In 1 991, CIDA is known to have commissioned a study on "Participation of Women in the Small Enterprise Sector in Sialkot and Faisalabad". Whereas JICA has commissioned a nation-wide, social impact study of the FWB, this is still being finalized and is not av ailable for reference for at least another month.

Apex NGOs have tried out different models of delivering financial services to their targeted beneficiaries. Some NGOs are known to have specialized successfully in micro-enterprise development and marketing and yet others have exper imented with an integrated approach on a smaller scale whereby, capital is made accessible with entrepreneurial skills and support in marketing. However, there are no structures in place for exchanging and sharing information and experience on successful credit models at regional levels, their similarities and differences, as well as effective entrepreneurial support and training groups. Similarly, those specialist NGOs who offer training in development of entrepreneurial and marketing skills are either u nknown or inaccessible to smaller CBOs.

The framework for the Women in Urban Credit PA addresses the need for economic empowerment of women through improved access to and control over productive resources, including knowledge, micro-credit and mark eting channels.

An intensive consultative process, resulted in recommendations at the policy level as well as specific interventions required for capacity building of various institutions and female borrowers, as well as research strategies. The k ey intervention areas identified during the consultative process are: i) Easy access to credit for women; ii) Effective outreach of credit to female borrowers; iii) Different sources of credit to be identified and linkages forged between the credit insti tutions and female borrowers; iv) Increase the demand for credit; v) and collate and disseminate information on women and micro-enterprise and gender disaggregated data on micro-credit.

The PA will initiate, strengthen and assess mechanisms ensuring women's access to micro-credit and its effective utilization. A high-powered micro-credit consultative committee, 'Policy Group on Credit' will be established to lobby with Government and Credit Institutions. The committee will consist of representatives from Ministry of Finance, Ministry of Women Development, Social Welfare, Special Education, First Women Bank, other related banks, an economist, a legal expert and NG Os specializing in credit. The Policy Group on Credit will ensure that gender sensitive policy takes root at the macro level.

In addition, an information and resource centre, (Women and Credit Information and Resource Centre) will be set-up to collate, analyze and disseminate information and generate gender-disaggregated data on women & credit. Networking through the resource centre at the national level will serve to bridge gaps between large experienced NGOs, intermediary NGOs, CBOs and NGOs specializing in micro-enterprise development and entrepreneurial skills. The target beneficiaries w ould be GOP, NGOs and credit institutions for the purpose of policy formulation and planning programmes on micro-credit.

Training will be provided to credit institutions including First Women Bank and NGO's/CBO's to build their respective capacities and expand credit demand with a focus on pilot programme areas (Karachi/Rawalpindi). A Project Support Office for this purpose will be established at FWB to strengthen the bank's existing training institute.

Assistance will also be provided to conduct situation analysis studies for baseline data and assessment of specific areas of credit policy (including NGO credit models and their legal framework, so as well as social impact studies o f credit schemes). An 'institutional diagnosis' of First Women Bank will be carried out in order to upgrade and strengthen the institution to play a pivotal role in micro-credit disbursement to women.

The strategic interventions proposed for this project consist of an integrated approach which spans six broad areas, namely, policy, building on experience, networking, training, advocacy and research. In order to m aximize the impact and achieve the objectives outlined above, it is imperative that these interventions be directed at all actors involved in the project at various levels (CBOs, credit disbursing and trainer NGOs, public and private sector banks and Mini stry of Finance) and link various actors together.

It is proposed that a high-powered, advisory and policy group on credit be established as a pressure group to lobby with the relevant public sector administrative bodies for long-term, policy changes. Its overall br ief would be to ensure that gender-sensitive policy takes root at the macro level. This will make capital, a productive resource, more accessible to women in the long run. The Policy Group on Credit should be considered an expert group on credit an d consist of representatives from the following:

• Ministry of Finance
• Ministry of Women Development, Social Welfare and Special Education
• Federal Chamber of Commerce
• First Women's Bank
• Other selected banks
• An economist from a research institution like PIDE/AERC
• A panel of six members from apex NGOs and those specializing in micro-enterprise credit (NRSP, OPP, SUNGI, ABP&WA, NEW/ECDI and Shirakat).
• A lawyer.

The following issues need to be addressed by this Policy Group on Credit:

• Currently, the First Women's Bank is suffering from a split personality due to its dual functions of a commercial bank as well as a DFI. The proposition should be made through this committee to create a special division in the bank to manage small business (micro-credit) transaction so as to separate the commercial and the development activities.
• Advocate a mandatory policy for positive discrimination/preference for a percentage of senior female employees in the banking profession.
• Advocate a mandatory policy for establishing special windows for women clients in all banks.
• Lobby with the Ministry of Commerce to amend rules and allocate a reserved seat for one female executive in provincial/federal Chambers of Commerce;
• Ensure that at least one of these women, occupying reserved seats in the Chambers of Commerce, is represented on the high-powered Policy group on credit;
• Lobby with the Government of Pakistan/State Bank to support concessional interest rates for NGOs for onward lending on the basis of institutional strength as opposed to collateral;
• Pressure banks, either directly, or through the Government, to simplify borrowing procedures for micro-enterprise credit;
• Lobby government to institute a mandate for all public sector institutions, including the Bureau of Statistics, and private sector banks to collate gender-disaggregated data;
• Initiate a nation-wide Small Business Women's Association as an interest group;
• Establish contact with banks who have credit lines for women or micro-enterprise credit windows, and encourage them to link with NGOs;

In the PA phase some of the above activities will be initiated.

A number of NGOs are implementing micro-credit programmes very successfully through a revolving fund or funds provided by the credit institutions. Some apex NGOs have developed micro-credit policies based on the e nvironment/conditions they are working in which are being replicated by a number of smaller NGOs in different regions of the country.

Financial institutions are beginning to realize the potential of micro-credit. All major banks, both in the private and public sectors, like Muslim Commercial Bank, Allied Bank, Agriculture Development Bank of Pakistan, Khyber Bank and First Women Bank are managing small business sector development funding portfolios including micro-credit. The First Women Bank has been experimenting with credit disbursement to NGOs in Sindh on the bases of institutional strength and a good track record.

The Women in Urban Credit Project will support effective institutional links geared towards increasing micro-credit disbursement by banks who offer micro-enterprise credit through apex NGOs with good credit models and who represent the interests of smaller Community Based Organizations (CBOs).

The project will work in collaboration with UNDP funded projects/programmes like GEF/LIFE projects. A network of CBOs has already been established in Rawalpindi area which is also the proposed pilot program area of this project. S imilarly close contacts with other major programmes and a built-in system for their involvement through out the PA will be established.

While access to credit is a necessary financial intervention which determines women's involvement in self-employment at the informal sector, it has to be augmented by a range of other services to enable women to ab sorb the capital in a productive manner. Economic interventions, such as, training in enterprise development and marketing, are essential services which can be offered through networking and training. The establishment of a Women and Credit Information a nd Resource Centre (WCIRC) at a national level will serve as a focal point for integrating together various components of the project and facilitating communication between various actors.

Networking through a resource centre at the national level will serve to bridge gaps between large experienced NGOs, intermediary NGOs, CBOs and those NGOs which specialize in micro-enterprise development and entrepreneurial trainin g skills as well as marketing. Through networking, provincial networks can be linked together through the national one. NGOs can find a platform to engage in sharing and exchanging ideas and experience as well as review their work periodically, and lobby with the Government for policy changes identified above. For example, information can be collated on NGO successes and difficulties with implementation of credit models, techniques of credit management, monitoring system for effective accountability, etc. The information will also be shared with the Women’s Division and the BFUs (Beijing Follow-up Units).

A study tour to some well-known and successful micro-credit programmes could provide useful lessons which can be replicated in Pakistan. National Bank for Agriculture and Rural Development (NBARD) in India, Grameen and BRAC in Bang ladesh are some of the successful models.

Training needs, that is, human resource development, of different NGOs as well as credit institutions can be identified and coordinated by the Project Support Office. Appropriate courses will be tailored and designed, organized and implemented according to the needs of various institutions. These will include courses in savings and credit disbursement; entrepreneurship skills, both general (management, marketing) and technical (book-keeping and accounting) through specialist NGOs wh ich have developed expertise in credit and enterprise development.

The First Women Bank has a Training Institute in the major cities. The bank implements integrated credit programmes with training in entrepreneurial skills to female borrowers, on ad hoc basis when ever funds are available and su pported by a donor agency. The above mentioned specialist NGOs need to be linked with the FWB on-an ongoing basis so that the latter's training infrastructure can be utilized by the former effectively. This will serve the process of mutual strengthening.< /P>

Banking staff at the FWB, generally speaking, have limited knowledge about the way NGOs operate and function. It is, therefore, imperative that those staff members assigned the work of administering the micro-enterprise fund be give n an orientation in NGO culture. An insight into social organization, mobilization and poverty alleviation strategies will give such staff a conceptual background and awareness of alternative credit delivery mechanisms which will strengthen their understa nding of the issues at hand. Furthermore, banking staff who are responsible for such special schemes, ought to be given a specifically tailored, gender training in order to sensitize them towards credit needs of female borrowers.

The fourth aspect of the strategy consists of a data bank which should focus on collating, analyzing and disseminating information on women and micro-enterprise on an on-going basis through a bi-monthly newsletter c irculated to NGOs in Urdu. Among other things, the data bank should devise a standardized format of a quantitative, gender-disaggregated, data collection system for CBOs and NGOs, as well as formulate a methodology of measuring economic empowerment. The data bank should be actively involved in generating primary data as well as compiling and publishing periodically, a number of directories in order to raise the profile of women in entrepreneurial ventures:

• A directory of women in banking, finance, commerce and industry
• A directory of women manufacturers and producers
• Working Paper with statistics on Women and Property Holdings and Women in Business Studies

In the PA phase work will be initiated in the above categories.

The project needs to under take a number of baseline studies pertaining to women's credit needs on the one hand, and banking procedures on the other. It is this basic data which will determine the specific direction of the project. The studies which are to be carried out from a socio-economic and cultural, as well as a technical perspective are outlined below:

a. A research project should focus on compiling a portfolio of situational analysis of urban women's credit needs. In addition to quantitative data, this should include qualitative case studies related to credit needs and use. Specif ic areas need to be identified for the pilot project and credit needs assessment studies must be conducted there. Focus of the studies should include the following questions:

• What is the socio-economic status of women?
• Is there a demand for credit among women?
• What is the nature of this demand?
• Do they have skills which can be upgraded and marketed?

b. Published studies and unpublished reports on women, credit and micro-enterprise development which already exist at the CBO and NGO level, need to be collated and analyzed. Special attention ought to be focused on evaluation and mo nitoring and the way empowerment through credit is verified and assessed.

c. NGOs where savings are an integral part of credit are experiencing obstacles in terms of the way forward. The legal and regulatory framework involved in channelizing savings into credit needs to be studied carefully. This will in clude a review of Banking Companies Ordinance, the Co-operatives Act and other such legislation. The legal position of NGOs in advancing credit or collecting savings needs to be determined and an alternate legal framework under which NGOs can undertake b anking functions may need to be formulated. Particular attention needs to be given to safeguards necessary to ensure the safety of savings deposited by the poor with NGOs.

d. Preliminary interviews with senior ranking FWB staff confirms the urgent requirement of an "institutional diagnosis" of the First Women's Bank by a technical expert which is strongly endorsed here. The existing situation at the ba nk needs to be analyzed with a view to upgrading and strengthening this institution in order to make it play a pivotal role in micro-credit disbursement to women. Particular attention is to be focused on the evaluation of the non-traditional banking secto r consisting of advisory and consultancy services for female entrepreneurs. Donor agencies such as JICA and OECF recognize the tremendous potential that the bank can has to play in promoting the economic empowerment of women and have expressed an interest in funding it.

e. A social impact study of the FWB which has been commissioned by JICA is in the process of being completed. A further study may be instituted to cover other micro-enterprise schemes offered by banks with a view to assessing compara tive differences if any.

Primarily, the 'Women in Urban Credit' project intends to create income-generating opportunities through self-employment for disadvantaged women of the lower income group, thus linking micro-enterprise development w ith poverty alleviation. Whereas the main focus will be micro-credit (Rs. 2,000 to Rs. 25,000), it has to be acknowledged that business women are under represented on the whole, and also deserve to be encouraged to venture into commercial enterprises at t he middle-level of credit (Rs. 25,000 to Rs. 60,000). The target beneficiaries of the PA will be the following:

The PA for 'Women in Urban Credit' aims to formulate a three-year project proposal to enhance women's access and control over micro-credit. This will be done primarily, by building the capacity of the First Women B ank and devising linkages of the bank with NGOs/CBOs. Activities related to policy level interventions and research will be initiated and tested out in this period.

A project document for the 'Women in Urban Credit' project developed with a PCM approach.

Project Support Office (PSO) is established in FWB.

The Project Support Office will be established in FWB for the purpose of strengthening the Training Institute of the Bank, coordinate and advise the bank on institutional reforms and collaborate with the proposed Women Information a nd Resource Centre. The existing facilities will be improved under the PA by placing a training expert who would develop training materials, train the bank's trainers and coordinate the training program for NGOs/CBOs and bank staff in the above mentioned training courses.

Capacity of FWB and NGO's/CBO's built.

Modality of Japan/UNDP MBC developed and coordinated. Complementarity between PA and planned Japanese assistance identified.

Processes for promoting Women in Urban Credit policy planning at the national level established .

A high-powered Policy Group on Credit established.

The Policy Group on Credit will constitute senior Government Officials, NGO leaders, Credit experts and a lawyer. The Group will meet frequently to formulate strategic recommendations for policy making and lobby with government/ba nks/DFI's to promote gender-sensitive policies on micro-credit.

The policies to support mandatory increase in the number of women in banking, simplifying borrowing procedures, establishing attractive terms of borrowing and establishing special windows for women in banks promoted.

Relevant data-base and information dissemination through effective networks developed.

A 'Women and Credit Information and Resource Centre' established. This will be sub-contracted to an existing professional organization. The information on Women & Credit could be shared through internet wherever possible.

Activities

The Centre will initiate the following activities:

3.1.1 Collate and analyze secondary data from Bureau of Statistics, Banks, etc.

A portfolio of research studies on micro-credit issues developed.

Research/information on credit and gender-disaggregated data disseminated.

The PA will be nationally executed by the FWB through the Ministry of Finance. It will be implemented by UNDP Country Office upon the request from the Government.

The project will be managed by a team of professionals. A Project Support Office will be set up at the FWB. A national Project Director will be appointed by the Bank. A Project Manager, an HRD Coordinator with support staff will b e hired to take on the project activities.

A review committee will reivew the progress of the whole project and provide overall directions for interventions. The committee will consist of Economic Affairs Division, Finance Ministry, First Women Bank and UNDP. First Women Bank will chair the committee, which will meet on a need basis.

The Information Center will be subcontracted to a private company, and will be monitored by the Project Manager and UNDP program Staff.

UNDP-funded inputs for the project are listed below and included in the budget for the UNDP contribution. The national executing agency will utilize support services of the UNDP country office for the mobilization of project inputs on all budget lines that identify the Government as the implementing agency and for the related accounting, disbursements and financial reporting.

The signed Preparatory Assistance Document, will constitute the Resident Representative’s authority to expend project funds on behalf of the executing agency provided that specific instructions (terms of reference, specifications, e tc.) have been received from the executing agency and that these instructions are in accordance with the project document and any subsequent revisions.

UNDP will directly access the budget line designating the Government as Implementing Agency for 1). duty travel for monitoring missions by UNDP programme officers and conerned Government officials, 2). auditing, and 3). sundries and charge these lines as actual expenses are incurred by UNDP.

A Short-term Consultant will be provided for project formulation.

A Human Resource Co-ordinator will be hired to conduct training programmes for bank staff and NGOs/CBOs. The position of Human Resource Co-ordinator is budgeted for fifteen months. The job description of the expert is atta ched.

There is provision for travel and mission costs to cover travel for monitoring of specific activities, evaluation mission and any such expenditure.

UNDP funds will be available for three research and policy analysis studies.

A revolving fund for assisting NGOs in initiating micro-credit programme.

This will be sub-contracted to a reputable private audit firm to ensure proper use of project resources.

Funds will be available for a six member group for a study tour of South Asia, to learn from successful models, for about 10 days.

Two desk-top computers, one photocopier and some furnishings will be provided to the Project Support Office at the FWB.

The UNDP inputs for the Women and Urban Credit Project will total USD 291,000.

Other than the normal UNDP procedures with regards to monitoring, an annual review of the PA will be conducted as part of Gender Programme Review by a team of national/international consultants. The logistics of th e mission will be handled by the Gender Unit.

This Project Document shall be the instrument (therein referred to as a Plan of Operation) envisaged in article 1, paragraph 2, of the agreement between the Government of the Islamic Republic of Pakistan and the Uni ted Nations Development Programme concerning assistance under the Special Fund Sector of the United Nations Development Programme, signed by the parties on 25th February 1960.

The following types of revisions may be made to this project document with the signature of the UNDP resident representative only, provided he or she is assured that the other signatories of the project document have no objections t o the proposed changes:

1. Revisions in, or addition of, any of the annexes of the project document;
2. Revisions which do not involve significant changes in the immediate objectives, outputs or activities of a project, but are caused by the rearrangement of inputs already agreed to or by cost increases due to inflation; and
3. Mandatory annual revisions which rephase the delivery of agreed project inputs or increased expert or other costs due to inflation or take into account agency expenditure flexibility.