Good practices for the economic inclusion of people with disabilities in developing Countries: funding mechanisms for self-employment

 Contents

Part I: Overview of the Context 15

1. Understanding the economic situation of people with disabilities 15
1.1 The relationship between poverty and disability 16
1.2 Employment perspectives for people with disabilities 17
1.3 Why do people with disabilities opt for self-employment? 17
1.4 What kind of economic activities do people with disabilities develop through self-employment? 17
1.5 Requirements for successful self-employment of people with disabilities 18
1.6 When is self-employment an adequate option? 18
1.7 People with disabilities: a heterogeneous group 18
1.8 Analysing strengths and weaknesses for self-employment 19
1.9 A livelihoods approach to economic inclusion 19

2. Understanding disability 21
2.1 Defining disability 22
2.2 Is there an international legal framework to protect the rights of people with disabilities? 23
2.3 Inclusion through community-based rehabilitation 23
2.4 Self-employment for people with disabilities: a multi-sector approach 24
2.5 The situation of landmine victims 25

3. Understanding funding mechanisms and the microfinance sector 27
3.1 What are ‘funding mechanisms’? 28
3.2 Microfinance and its innovations 28
3.3 Lending methodologies 30
3.4 Why do some programmes require savings prior to disbursement of a loan? 30
3.5 Why do some microfinance institutions charge ‘high’ interest rates? 30
3.6 Does microfinance actually reach the poor? 31
3.7 Self-help groups 32
3.8 Non-financial services 33

Part II:Guidelines to Facilitate Access to Funding Mechanisms 35

4. Funding mechanisms for people with disabilities: what is being done in the field? 35
4.1 The use of grants 36
4.2 The use of loans 37
4.3 Combining grants and loans 39

5. Practical recommendations for the provision of grants and loans: factors to consider 41
5.1 Using grants: lessons learned 42
5.2 Using loans: lessons learned 44
5.3 The role of institutional goals and organisational capacity 46

6. Facilitating the inclusion of people with disabilities in mainstream microfinance institutions 51
6.1 Complementary partnerships between microfinance institutions and organisations of/for people with disabilities 52
6.2 How to promote information exchange among microfinance institutions and organisations of/for people with disabilities 53
6.3 Targeting microfinance providers 54
6.4 Integrating people with disabilities into mainstream microfinance institutions 56
6.5 Arrangements for people with disabilities: are they appropriate? 58
6.6 Minimising the financial risk that microfinance institutions may perceive in serving people with disabilities 60

7. Providing funding mechanisms: experiences from organisations of/for people with disabilities 65
7.1 The role of organisations of/for people with disabilities 76
7.2. Organisations of/for people with disabilities and strategies to facilitate access to funding mechanisms 67
7.3 Managing revolving funds 67
7.4 Supporting the creation of self-help groups 70

8. Implementing programmes to facilitate access to funding mechanisms 75
8.1 Identifying the needs and context of the target population 75
8.2 Formulating programmes to facilitate access to funding mechanisms 80
8.3 Implementing the programmes: general recommendations 82
8.4 Monitoring and evaluating progress 85

Main recommendations 87

Concluding remarks 91
Glossary 93

Annex 1. Methodology 94
Annex 2. Summary of findings 100
Annex 3. Case studies 104
Annex 4. Recommended reading 110