Bankers on bikes give third-world loans

``Bankers on motorbikes,'' they are called, bank officers who bounce along rural tracks in Pakistan offering loans to, and collecting repayments from, the landless rural poor never able to borrow money before. At one time a group of bandits called dacoits terrorized travelers in the Tangail area of Bangladesh. But one of them asked a new bank for a loan to set up an open-air rickshaw repair shop. Now the brigands have turned businessmen.

In Katmandu, Nepal, a mother with two children joined a small-farmer program after her husband left her. She borrowed 120 rupees (about $10) for a beehive and 3,000 rupees for a carpet loom. By selling honey and making carpets, she earned more than enough to pay back the loans.

These are three of the projects organized by the International Fund for Agricultural Development (IFAD) which is now at a financial crossroads.

``Providing rural credit in Asia is one of the fastest ways of achieving results,'' says MacDonald Benjamin, director of IFAD's Asia division in Rome.

The pitfalls of lending to the landless poor are all too obvious. Unlike rich farmers, they have no tangible collateral. They have no track record of repayments, nothing to seize if they default.

Any plan to help them requires shrewd judgment about which farmers have the best ideas, commitment, stamina, and energy.

It is too early to judge overall IFAD results with credit plans, which are still less than five years old. But Mr. Benjamin is encouraged that:

The Grameen Bank in Bangladesh, supported by IFAD loans, is said to be reaching 160,000 landless households. Known as ``the poor man's bank,'' Grameen is now lending about $1.7 million a month.

Repayments are 99 percent on time.

``It's a risky business,'' Benjamin says. ``You have to have a degree of faith in poor people's willingness to accept the discipline of repayments.''

So far, the plan has worked in Bangladesh, Pakistan, and Nepal.

In Bangladesh, prospective borrowers form groups of five. Only two are allowed to borrow at first. If they pay back on time, others can borrow. Each member of each group has a keen interest in seeing that the others earn enough to repay.

Grameen reports a delinquency rate of 2.73 percent over one year, and 0.13 percent over two years.

Rural credit IFAD-style is also on offer in Malawi, Thailand, and Indonesia (where livestock bought for farmers being moved off the overcrowded island of Java is called ``IFAD cattle.'')

In Africa, an IFAD-backed credit plan to enable Ethiopian village cooperatives to buy pairs of oxen aimed at 4,000 pairs but has now provided 8,000.

``You also have to convince Africans of the need to work harder,'' says Bahman Mansuri, director of IFAD's Africa division.

``It comes back to the individual,'' says Mr. Mansuri. ``We're trying to give him the opportunity to better himself.''