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Women, Justice and Gender Equality

I thank my hon. Friend for her helpful intervention. That is exactly what happens in the east end, where the project is working with ethnic minority groups. It is using the Grameen model, and of course some of the women are from Bangladesh. That project is working towards overcoming the sharia law aspect in terms of interest and profit. Although interest is paid, it is paid into a pot that is then lent again and the institution is basically non-profit making. Microcredit reverses conventional banking practice by removing the need for collateral and creating a banker system based on mutual trust, accountability and participation. It works on the basis that the bank should go to the borrowers, not the other way round. Interest is charged on the loan and used to help other women. The rates of interest—at a typical annual percentage rate of 19 per cent.—are far lower than rates at which someone who is impoverished could hope to borrow from any other source, if any were available. The repayment rates are remarkable. It is perhaps a feature of the women who repay, but the group support is also vital. In projects that I have seen overseas, the loans have been very small, £20 or £50, but in Street Cred a typical first loan is for about £500. There is still pressure to repay the loan in a relatively short time, but I think that that adds to the project’s success. Interestingly, only 39 per cent. of women who join a borrowing circle actually take on a loan. The others benefit from one-to-one support and business help and are then able to access other sources of finance. A succession of loans is made in about 12 per cent. of cases, but the important point is that the people involved get off to a start and are then able to enter the main banking system. Microfinance deserves a lot more support because it offers a way to tackle financial exclusion in our affluent society. I love stories about microfinance. They bring the subject to life, so I shall tell one very quickly. Karen Winchester founded Diveen’s Cuisine, a Caribbean restaurant and catering business in Walthamstow. At first, she had difficulty getting information and support, and many of the places that she approached were concerned that she had no experience of running her own business or a restaurant, and no collateral to access credit. Ms Winchester found a leaflet about Street Cred and joined a borrowing circle in 2002. She attended a number of business workshops and had one-to-one meetings, and began her business by providing catering for events. Later, she opened her restaurant. Her first loan was used to purchase catering equipment and, when she paid that back, she took out another one to improve the restaurant. She found that she able to pay the loans back without coming under the same pressure that she would have experienced with a bank. Sometimes during the week, she uses her restaurant to host her borrowing circle—an example of how good practice can be spread. Time is short, so I must not indulge in giving the House more examples. I shall end by quoting a ““Gracious Ordinance”” that the ““Honourable Lords”” of the Royal Courts of Justice, the highest court in England, made in 1871. They said:"““No loans to any woman whatsoever.””" That makes it clear that they thought that lending to women was a bad idea. We have made some progress since then, but it is important that we appreciate that microfinance is good for women. In addition, women are good for microfinance internationally and, as we celebrate international women’s day, we should remember the poorest women across the world. However, we must not forget the women in our society, for whom relative poverty can be very hard to overcome.