09 - 2008
PROPOSE IMPROVEMENTS ON
MICROFINANCE INSTITUTIONAL REACH
TO ALLEVIATE POVERTY AND CONSERVE
BIODIVERSITY IN SRI LANKA
K M OSHADEE H SIYAGUNA

Table of Contents
ABSTRACT ............................................................................................ Error! Bookmark not defined.
INTRODUCTION ................................................................................................................................. 5
1.1 Background.............................................................................................................................. 5
1.2 Research Questions .................................................................... Error! Bookmark not defined.
1.3 Research Objectives .................................................................... Error! Bookmark not defined.
CHAPTER TWO: LITEREATURE REVIEW .................................................. Error! Bookmark not defined.
2.1 Chapter Overview ....................................................................... Error! Bookmark not defined.
2.2 Poverty, Food Crisis and Sri Lanka ............................................... Error! Bookmark not defined.
2.3 Microfinance and Poverty Alleviation .......................................... Error! Bookmark not defined.
2.4 Microfinance Institutions under Investigation ............................. Error! Bookmark not defined.
2.5 The Need for Biodiversity Conservation ...................................... Error! Bookmark not defined.
2.6 Poverty Alleviation and Biodiversity Conservation....................... Error! Bookmark not defined.
2.7 Microfinance and Biodiversity Conservation ............................... Error! Bookmark not defined.
2.8 Conclusion .................................................................................. Error! Bookmark not defined.
CHAPTER THREE: RESEARCH METHODOLOGY ....................................... Error! Bookmark not defined.
3.1 Chapter Overview ....................................................................... Error! Bookmark not defined.
3.2 Research Perspective .................................................................. Error! Bookmark not defined.
3.3 Research Design.......................................................................... Error! Bookmark not defined.
3.3 Primary Data Collection Methods................................................ Error! Bookmark not defined.
3.3.1 Interviews:- .......................................................................... Error! Bookmark not defined.
3.3.2 Questionnaires:-................................................................... Error! Bookmark not defined.
3.4 The Analysis and Presentation of Data ........................................ Error! Bookmark not defined.
3.5 Results Quality ............................................................................ Error! Bookmark not defined.
3.5.1 Validity................................................................................. Error! Bookmark not defined.
3.5.2 Reliability ............................................................................. Error! Bookmark not defined.
3.5.3 Generalisibility ..................................................................... Error! Bookmark not defined.
3.6 Ethical Considerations................................................................. Error! Bookmark not defined.
CHAPTER FOUR: DATA ANALYSIS AND DISCUSSION............................... Error! Bookmark not defined.
4.1 Chapter Overview ....................................................................... Error! Bookmark not defined.
4.2 Population Key Characteristics .................................................... Error! Bookmark not defined.
4.3 Microfinance and the “Ultra Poor” .............................................. Error! Bookmark not defined.
4.3.1 Introduction ......................................................................... Error! Bookmark not defined.
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4.3.2 Income and Ease of Obtaining Micro-Financial Services ........ Error! Bookmark not defined.
4.3.3 Availability of Collateral and Ease of Obtaining Micro-Financial Services.... Error! Bookmark
not defined.
4.3.4 Savings and Ease of Obtaining Micro-Financial Services ........ Error! Bookmark not defined.
4.3.5 Gender, Race and the Ease of Obtaining Micro-Financial Services ....... Error! Bookmark not
defined.
4.4 Microfinance and Beneficiary Living Conditions .......................... Error! Bookmark not defined.
4.4.1 Introduction ......................................................................... Error! Bookmark not defined.
4.4.2 Microfinance and Living Condition Improvements ................ Error! Bookmark not defined.
4.4.3 Microfinance and “Financial Shocks” ..................................... Error! Bookmark not defined.
4.5 Knowledge of Agro/Biodiversity within the Beneficiaries ............ Error! Bookmark not defined.
4.5.1 Findings ............................................................................... Error! Bookmark not defined.
4.5.2 Analysis ................................................................................ Error! Bookmark not defined.
CHAPTER FIVE: CONCLUSIONS .............................................................. Error! Bookmark not defined.
5.1 Chapter Overview ....................................................................... Error! Bookmark not defined.
5.2 Conclusions................................................................................. Error! Bookmark not defined.
5.2.1 Microfinance, the “Ultra Poor” and Other Factors ................ Error! Bookmark not defined.
5.2.2 Microfinance and Living Conditions ...................................... Error! Bookmark not defined.
5.2.3 Agro/Biodiversity Conservation and Microfinance ................ Error! Bookmark not defined.
5.3 Recommendations ...................................................................... Error! Bookmark not defined.
5.3.1 Improving Micro-Financial Institutional Reach ...................... Error! Bookmark not defined.
5.3.2 Micro-Financial and Agro/Biodiversity Conservation Integration ........ Error! Bookmark not
defined.
5.3.3 Food Crisis, Agro/Biodiversity Conservation and Microfinance ........... Error! Bookmark not
defined.
5.4 Further Research and Research Limitations ................................. Error! Bookmark not defined.
REFERENCES ......................................................................................... Error! Bookmark not defined.
Bibliography ......................................................................................... Error! Bookmark not defined.
APPENDIX I ........................................................................................... Error! Bookmark not defined.
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ABSTRACT
Microfinance institutions claim to reach the ultra poor in a society but some academics
argue that the services do not reach the grass roots level, microfinance institutions also
claim that the living conditions of its beneficiaries improve with the provision of financial
services. Primary data gathered for this research and subsequent analysis indicate that the
services do not reach the grass roots level, however the living conditions of the beneficiaries
had improved since the provision of the micro-financial services. Analysis also shows that the
living conditions of the relatively wealthy of the poor enjoyed better outcomes from the
provision of services. The importance of environmental, agro/biodiversity conservation and
its economic impacts are highlighted by many academics, this research explored the
relationship between conservation, poverty and microfinance. The basis of the research was
that at their state the poor have no financial freedom to practise environmentally friendly
practises therefore they are a cause of biodiversity destruction. The research investigates
and presents a case that microfinance can be utilised to conserve biodiversity while
alleviating poverty. The paper presents recommendations on how to improve outreach and
to retain the sustainability of the microfinancing institution while utilising schemes which
would assist in the conservation of biodiversity. The paper also briefly discusses the problem
of the food crisis and how biodiversity conservation can assist in alleviating the situation and
how microfinance institutions can assist the agricultural community to address the crisis.
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1.1 Background
This paper will firstly explore the microfinancing phenomenon and how it fares in poverty
alleviation in general. Following this the paper will focus on Sri Lanka and how
microfinancing institutions in Sri Lanka fare in poverty alleviation. Following this the paper
will discuss the importance of biodiversity its importance to economic and social
development and food security in the current context of the food crisis with particular
reference to Sri Lanka. Biodiversity and environmental protection are closely related
therefore considerable attention would be given to environmental protection as well. On
the basis that biodiversity and environmental conservation will in turn assist poverty
alleviation, recommendations for microfinancing institutions will be put forward on how to
alleviate poverty and ensure food security through biodiversity conservation.
According to the Convention on Biological Diversity ‘Biological diversity means the variability
among living organisms from all sources including, inter alia, terrestrial, marine and other
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aquatic ecosystems and the ecological complexes of which they are part; this includes
diversity within species, between species and of ecosystems.
The importance of biodiversity is critical as larger the variety of species of plants larger the
variety of available crops the same would apply for livestock and in addition diversity
ensures that ecosystems are naturally sustained. The variety or diversity of life would also
assist in medical discoveries, socio-economic development and would prepare humans for
an adaptive response for climate change Araya & Christen (2004). The scale of its
importance should be appreciated as 40 percent of the world’s economy is derived through
biological resources. Conservation International following Norman Myres seminar paper in
1988 identifies several regions as biodiversity hotspots, the selection criteria is based upon
plant endemism and serious habitat loss. To qualify the region should possess 1500 vascular
plants as endemic and at least 70 % of the original habitat should be lost. Sri Lanka is
identified as a biodiversity hotspot only having 1.5 percent of its original forest cover left
and also carries many endemic species of plants. 916 of 3210 flowering plants and 18 of 52
genera are endemic, 20 species of birds and mammals, 175 species of reptiles and 140
species of amphibians are endemic.
Two thirds of the population in Sri Lanka lives in the wet zone where endemism is high, the
islands rainforests were cleared for cinchona (medicinal plant) cultivation then coffee, tea,
and rubber. Threats to the remaining forest cover are the small scale tea planters,
cardamom cultivators and farmers. Forest clearing for cultivation and issues relating to
farming such as the use of agro-chemicals are straining the eco-systems. Poverty levels in
these areas are also comparatively high; rural areas in Sri Lanka have a poverty level of 15.7
percent compared with 6.7 percent in urban areas (Poverty Indicators 2008). Nationally Sri
Lanka is classified as a middle lower income country with a medium human development
index.
Poverty is viewed as a primary cause of environmental destruction as at their state they
cannot practise sustainable development or invest in environmentally-friendly practises
Araya & Christen (2004) which would require more capital thereby alleviating poverty would
in practise save the environment. A review by the World Bank on Environmental
Improvement and Poverty Reduction (2000) suggests that various macro and micro level
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policy measures, markets and prices, local institutional organization, gender should be
considered to fully appreciate the “complex” relationship between poverty and
environmental protection.
Micro-financing has been used to alleviate poverty for quite some time now and it’s
outcomes in alleviating poverty have been mixed as discussed in the literature review.
Within this context the paper will investigate if microfinancing does in fact alleviate poverty
and how to further enhance the distribution of access to micro credit programmes etc. to
the population below the poverty line while conserving biodiversity.
Biodiversity conservation is understood to be of great importance to the basic existence of
humans which is addressed in this research with another important issue of poverty
alleviation. This research will be continued to another master’s which I hope to study as a
research degree in economics.
1.2 Research Questions
1) Does micro financing reach the population below the poverty line? How does SEEDS
and Samurdhi programs perform in reaching grass roots level? Are there any other
factors such as gender and race which affect financial service distribution?
2) Does microfinancing assist the beneficiaries in improving their living conditions? Do
the institutions assist the beneficiaries when credit is urgently required i.e. sickness,
accidents and natural disasters?
3) Are the beneficiaries of microfinancing aware of biodiversity/environmental
conservation? Are the farmers aware of agro/biodiversity conservation? Are the
institutions doing enough to conserve biodiversity/environment?
4) How can microfinancing institutions reach the “ultra poor” and actively encourage
biodiversity/environmental conservation through the services they offer? How can
biodiversity and microfinance assist the “ultra poor” face the food crisis?
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1.3 Research Objectives
1) Review and critically analyse primary data on whether micro financing assists in
poverty alleviation, identify the frameworks used by SEEDS and Samurdhi programs
and critically evaluate their performance. Investigate if gender and race affect the
distribution of financial services.
2) Identify and critically analyse if the microfinancing institutions improve the living
condition of its beneficiaries by gathering primary data. Analyse if the institutions
provide assistance in times of “shock” to its beneficiaries.
3) Review and analyse primary data and comment on the beneficiary’s knowledge on
biodiversity conservation. Investigate if the farmers are aware of agro/biodiversity
conservation. Critically evaluate if the institutions are efficient in encouraging
biodiversity conservation.
4) Based on the preceding discussions construct and propose recommendations on
improving the distribution of micro financing programs and recommend on how to
effectively integrate micro-credit to conserve biodiversity. Based on the analysis
recommend how to face the food crisis.
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Impact to biodiversity due to
human activities were more rapid in
the past half century than any time
in human history
(Millennium Ecosystem Assessment)
Evidence proves that when credit is
provided to the poor, they use the
money to fix their houses, send
their children to school, start a
business etc.
(CGAP report, 2007)
CHAPTER TWO: LITEREATURE REVIEW
2.1 Chapter Overview
This chapter will attempt to evaluate, compare and contrast articles written with regard to
the subject. An introduction to poverty and the food crisis would be given with regard to Sri
Lanka then the relationship between microfinance and poverty alleviation is introduced. In
addition one of the objectives of the research is also explored, articles which examine if
microfinancing reaches the ultra poor is extensively discussed within the chapter. Varying
and conflicting arguments are presented which also justifies the need for this research.
Following this the need for biodiversity is introduced and why biodiversity is important for a
sustainable economy and a sustainable future is pointed out. Then biodiversity conservation
and its relationship with poverty alleviation are discussed. Finally how microfinance could
be employed for biodiversity conservation and its feasibility are discussed.
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2.2 Poverty, Food Crisis and Sri Lanka
Sri Lanka has for a long time battled poverty and had channelled assistance to areas
identified as poor, following such a policy the country has achieved significant success
compared with countries of the same income levels. Policies have focussed on providing the
poor with food security, employment, primary healthcare and education UNDP (2003).
According to data gathered from the World Bank life expectancy at birth is 75 years, infant
mortality rate is 13 per 100 live births, adult literacy rates of 92 %, primary, secondary and
tertiary enrolment ratio is at 66% statistics comparable with more developed countries.
Where income is concerned the country still lacks behind with 15.2 % of the population
under the official poverty line, especially in the rural areas (15.7 %) and estate areas (32%).
Urban areas of the country have “eliminated” the problem of poverty reducing the levels
down to 6.7 % (Poverty Indicators, 2008). Amarasinghe et al. (2005) and Henninger & Snel
(2002) states that the prevalent problem exist as government intervention strategies are
inefficient at locating the “poor”. The national official poverty line lies at 2937 Sri Lankan
Rupees defined as the “minimum expenditure per person per month to fulfil the basic needs”
and this is the poverty line used for the purposes of this research paper.
As a net importer of food, the food crisis has sparked problems in Sri Lanka especially with
the current food price inflation levels according to the World Bank at 34 % forcing the
government to request funds from the World Bank's emergency Food crises response trust
fund. This is significant to this paper in two noticeable ways, one is that rising food prices
would increase poverty levels and additionally biodiversity conservation could assist in
tackling the food crisis. Therefore agriculture in the country should be prepared to tackle
the growing problem and microfinancing institutions and biodiversity conservation could
assist in tackling the problem. This would be discussed further in detail in the literature
review and data would be collected to investigate problem and recommendations will be
provided based on the collected data.
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2.3 Microfinance and Poverty Alleviation
Historically governments attempted to serve the poor with banking facilities by setting up
specialist agricultural banks and/or directing commercial banks to provide loans to
borrowers outside the urban areas. Most attempts were futile and failed due to the fact
that the governments could not effectively enforce loan repayment and the relatively
wealthy of the poor managed to obtain the loans as they were more powerful within their
social circle Adams et al. (1984), Adams & Vogel (1986).Thus Microfinance was born,
inspired through the principle that group lending schemes would positively effect the rural
poor by improving their living conditions. Academics such as Coleman (2004) believe that
the above belief is based on poor evidence. Academic s seems to have varying and at times
conflicting opinions about the impact of microfinancing the most apparent conflict is with
regard to the target population. Academics argue that the target population which is the
“ultra poor” who are at the bottom of the poverty pyramid do not receive the services of
the microfinancing institution due to varying reasons, which would be discussed in detail in
this chapter.
Coleman (2006) concluding on a study based on microfinancing institutions in northeast
Thailand states that the programs reach the relatively wealthy of the poor. Village bank
members within the context of the study were chosen by the value of land owned and the
creditworthiness of the members which was measured through informants from within the
village, which in fact account for a major weighting on the selection of members by the bank.
Therefore Coleman (2006) argues that institutions are employing the same information any
commercial bank would use to evaluate creditworthiness. The author continues to state
that the more powerful villagers become committee members and then exploit the
institution to obtain more loans, borrowing externally and internally sometimes using
multiple village bank accounts under different names. Coleman (2006) also observed that
some of the poorer members were excluded from the bank and some villagers did not know
of the existence of the bank, some villagers were “intimidated” to participate as they
viewed the bank exclusive to the relatively wealthy. On surveys conducted Coleman (2006)
observes that the impacts on wealth of the committee members were significantly more
than rank and file members. Committee member savings, income and labour time was also
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significantly better and the committee members had also engaged in money lending
services. The committee members allegedly borrowed money from the village bank at lower
interest rates and lent it to others at a higher rate. As the study focused on microfinancing
institutions which provided services to females the study also observes that following the
program, rank and file member’s husbands have more leisure time based on the perception
of their wives income. Overall the impact on rank and file members has been insignificant.
Therefore Coleman (2006) concludes that the village banks studied within his study does not
have positive effects on the ultra poor and that measures should be taken in order to ensure
that the credit does reach the ultra poor. Supporting this view Tsai (2004) concludes in his
research based on China and India, claim that MFI’s do not meet the demand for “grass root
credit”. On this paper the first objective is to explore on the claim of Coleman (2006) and
Tsai (2004) and to investigate if the services do reach the poorest. The second objective
would be whether there are any other factors (sex, race) which effect the distribution of
micro-financial services to the poor.
Woodworth & Hiatt (2006) on a study conducted in Central America states that promising
results have been achieved with regard to microfinance institutions. Institutions have had a
positive impact on daily per capita expenditure and daily minimum wage equivalent
according to the surveys conducted. The study however does not concern the general
population but already existing clients therefore the study does not explore if credit is
reaching the ultra poor. Within the study the author claims that newly joined clients earn
less than existing clients or ex clients. The study also observes that clients who participate
continually improve more rapidly than those who leave, therefore improving the economic
and social conditions of those with continued participation. The second objective of this
research would explore if the living conditions of the beneficiaries of financial services had
improved.
In contrast to the opinion of Coleman (2006), Khandker (2003) states that microfinance
programs do reach the ultra poor providing evidence from Bangladesh where in 1991/1992
90 % of the programs reached the poor and in 1998/1999 70 % of the programs reached the
poor. Khandker (2005) observes that microfinancing continued to reduce poverty at an
individual and collective (village) level. The author also states that returns to cumulative
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borrowings for female members received returns of 21 %. Supporting evidence is also
available from Montgomery (2005) on a study based in Pakistan where an empirical analysis
brought into light that micro-credit programs associated with Khushhali bank provided
improved the socio-economic status of the “very poorest”. Positive impacts with regard to
the micro-credit programs affected mainly on agriculture. The study emphasizes the fact
that the positive impacts were significant on the “very poorest”, the study also learns that
70 % of the program participants are below the official poverty line. The author also claims
that the findings challenge the claim that microfinancing does not reach grass root level
population. Khandker (2003) contradicts the opinion of Coleman (2006) thus conflicts of
opinions exist justifying the research on this paper.
Thilakaratna (2006) on a study conducted on microfinancing institutions in Sri Lanka
concludes that improvements in income, assets and household conditions could be
observed with participation on microfinancing programs. The paper continues to state that
the relatively wealthy of the poor are in a better position to manage and fund investments
via micro-credit programs than the ultra poor as they could bear the risks involved with
investments, this is due to the fact that the relatively wealthy are in a position to fund day
to day needs. The poorest the paper observes employs the monies for consumption rather
than investment; micro-credit programs have not addressed this issue according to the
paper. Taking a view similar to Adams and Von Pischke (1992) where the authors claim that
credit is not the biggest problem for rural farmers and that product prices, land tenure,
technology and risks limit smaller farmer development. Tilakaratna (2006) states that the
poorest have a lack of skills, training, technology and access thus even if micro-credit
programs do allow investment opportunities due to the lack of the above mentioned
sustainability of the investment is an issue. This research would also explore if adequate
facilities are in place to ensure training, technology and access to the beneficiaries of the
concerned institutions.
Jayathilaka (2000) affirm that beneficiaries from micro-credit programs do enjoy better
economical conditions but social conditions within villages have been in decline, within the
context of the literature reviewed for the purpose of this report this is the only instance
where the social conditions have been deeply reviewed. Where the economical conditions
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are concerned the author claims that brick manufactures have benefitted immensely, where
the manufacturers had insecurities when cash flow was thin micro-credit programs have
addressed the issue. Also claiming that some manufacturers had diversified, purchasing
vehicles with the monies borrowed through micro-credit programs and due to increased
profits with participation to the programs. Housing conditions of the beneficiaries also have
improved significantly. Where social conditions are concerned the author states that society
members and villagers have become disharmonized due to the economic disparity within
them, as new settlers were brought in 1976 to the survey region, mainly landless people
from other parts of the country and the author claims that the new settlers were neglected
and marginalized by the more economically superior population. But the economic progress
seems to gradually douse the tensions and to socially stratify. As with Coleman (2006),
Jayathilaka (2000) observes malpractices and corruption in the higher ranks of the bank and
the members of the bank are in disharmony with the leadership. Fernando (2008) on a
survey conducted in the Panadura divisional secretariat of the Samurdhi authority claims
that 28 % of the surveyed families should not be beneficiaries of the Samurdhi fund, the
Samurdhi authority will be further discussed in the following chapter.
A study conducted by Shaw (2004) in Sri Lanka which included SEEDS concludes that
evidence from Hambantota in southern Sri Lanka suggests that MFI’s are more efficient for
clients close to the poverty line than the clients below the poverty line. Shaw (2004) also
believes that other aspects such as infrastructure and living environment also plays a vital
role in micro-enterprise sustainability.
A varied base of opinions can be seen with regard to microfinancing and its impact on
poverty alleviation, where as mentioned above academics such as Coleman (2006), Tsai
(2004), Fernando (2008), Thilakaratna (2006) and Jayathilaka (2000) state that the ultra poor
do not receive services through microfinancing institutions as much as the relatively
wealthy while Khandker (2003/2005) and Montgomery (2005) concluding that research
show that in fact microfinancing institutions do reach the ultra poor. Several issues have to
be addressed with regard to whether microfinancing institutions do reach the ultra poor;
the studies have been conducted in various countries and within various institutions
therefore varying factors would affect the studies. Thus the positive results provided by
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Khandker (2003/2005) or Montgomery (2005) could be due to the fact that the surveyed
institutions in the research did reach the poor but the other researchers could not find any
evidence to support the fact that microfinancing does reach the ultra poor. Research within
the context of this paper would attempt to investigate the effectiveness of SEEDS and
Samurdhi programs in reaching the ultra poor as the views studied for the literature review
has conflicting results. Papers studied for this literature review do accept the fact that the
beneficiaries do have an improved standard of living after receiving financial services; this is
in contrast to the view of Rogaly (1996) where a cautious approach to microfinance is
advised. Research within this paper would also attempt to evaluate the effectiveness of the
programs with regard to the improvements of beneficiary standard of living. Jayathilake
(2000) explores the social conditions with regard to microfinancing and discovers that
negative factors do exist but also states that a positive trend could be observed with
improved economic activity. Within the context of this study the papers of Fernando (2008)
and Shaw (2004) will be reviewed extensively as they are based on the institutions under
investigation on this paper.
2.4 Microfinance Institutions under Investigation
The Samurdhi program was put forward in 1995 by the Sri Lankan government as a means
of cushioning poverty through social security programs aimed at alleviating poverty and
protecting the poor by making credit accessible Salih (2000). Group savings schemes are
available as “banku sangam” schemes where groups are formed to save money and in times
of need the money is borrowed to fellow members at low rates of interest, average loan
amounts to Rs. 1685 Salih (2000). “kadinam naya niyamaka” schemes are available and 84%
of the loans had been issued as investment loans, Samurdhi “naya sanvardana” scheme also
exist to assist people living under the poverty line. Primary data would be collected from the
beneficiaries of the bank to seek answers to the research questions.
The Sarvodaya movement and the Sarvodaya Economic Enterprise Development Services
(SEEDS) aim to “alleviate poverty by promoting economic empowerment of rural people for
a sustainable livelihood”. Sarvodaya movement mainly inspired by Buddhist economics
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states the importance of “right livelihood” and the replacement of full employment with full
engagement. The movement plans to satisfy families and awaken communities to have the
basic needs of life. They include adequate food supplies, health care, emergency
requirements, total education and spiritual needs. The savings groups are encouraged to
have the thought (metta): respect and kindness. The action (karuna): compassionate but
scientific plans to remove the causes of suffering. The immediate result (muditha):
dispassionate happiness. The long term result (upekha): equanimity. The banking division of
SEEDS has 3 types of loans ranging from Rs. 10,000 to Rs. 500,000 and claims to “keep less
as collateral” and to “provide credit to the poorest of the poor”. Primary data will be
gathered from participants of SEEDS to investigate and answer the research questions.
2.5 The Need for Biodiversity Conservation
The importance of biodiversity is critical as the variety of species of plants are larger the
variety of available crops the same would apply for livestock and in addition diversity
ensures that ecosystems are naturally sustained. The variety or diversity of life would also
assist in medical discoveries, socio-economic development and would prepare humans for
an adaptive response for climate change Araya & Christen (2004). The scale of its
importance should be appreciated as 40 percent of the world’s economy is derived through
biological resources.
Roe & Eliiot (2004) points out the importance of biodiversity in achieving the millennium
development goals. The authors claim that the goals are weak in the fact that it separates
environmental protection; they suggest that the environment underpins the success of the
other goals. Where poverty reduction is concerned biodiversity protection would provide
employment in eco-tourism and the development of other wild products, provide food
security in which biodiversity is vital (the UN food and agriculture organization also
acknowledges this fact), biodiversity also provides a sustainable source of drugs where 90 %
of the medicines have roots in natural resources and biodiversity is also vital in sustaining
water catchments in order to deliver water supplies.
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Within this report considerable attention would be given to the aim of conserving
agricultural biodiversity. Agriculture is a significant contributor (16 % of GDP) to the national
economy of Sri Lanka and plays a vital role in rural economics of the country. The term
includes all components of biodiversity but with relevance to food, agriculture and
components of biodiversity that represent agricultural ecosystems, which in turn is the
variability of animals (domesticated, aquatic resources, wild animals/fish hunted for food),
plants (crops, farm, pasture and rangeland species) and micro-organisms (microbial and
fungal genetic resources) at genetic, species and ecosystem level (organisms that assist, at
various levels to, inter alia, nutrient cycling, pest/disease, pollination, pollution, sediment,
hydrological cycle, erosion, climate and carbon regulation); these play a critical role within
the agricultural ecosystems COP 5 Decision V/5(2000). Although agriculture contributes to
biodiversity it is also a driver of biodiversity loss, biodiversity is being lost at an “alarming”
rate worldwide threatening the sustainability of agriculture thus food security and
livelihoods. Homogenization of agricultural production systems is seen as one of the reasons
for biodiversity loss, the food and agriculture organization estimates that 3/4th of genetic
diversity in crops have been lost over the century. Continuing 90 % of the food energy is
derived from only 15 plants and 8 animal species. Further problems are caused by modern
agriculture where unsustainable irrigation schemes, excessive use of chemicals and land
conversions.
Agricultural biodiversity plays an important role in sustainable food production,
maintenance of associated ecosystem services, genetic diversity allowing species to evolve
in order to adapt to changing conditions such as climate change and thus plays a important
role in the sustaining the livelihood of the rural population and global food security.
Therefore it could be noted as an important factor nationally to protect biodiversity, this is
more important today with the food crisis. Sri Lanka is a net importer of food and thus it is
important to ensure that biodiversity is conserved to sustain food production.
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2.6 Poverty Alleviation and Biodiversity Conservation
Environmental degradation and poverty are seen as inherently related; while further
environmental destruction intensifies poverty levels, and in turn increasing poverty levels
intensify environmental destruction within these regions. Academics argue that a primary
cause of environmental destruction is poverty and that as the poor communities cannot
practise sustainable development due to their financial status they are forced to rely on
environmentally unfriendly practises to earn a living. Research conducted on this paper
would attempt to explore if the ultra poor do intensify environmental destruction. Broad
(1994) states that reducing poverty would be an important factor in saving the environment
from further degradation. Bojo & Reddy (2002) states that environmental health and natural
resource utilization is closely linked with poverty reduction. But evidence suggests that the
current schemes employed by many countries to alleviate poverty in fact promote
deforestation and biodiversity decline. Wunder (2001) brings into light that South-East Asia
which has tackled poverty with success has also been a region with one of the highest rates
of deforestation. Thailand for instance turned a significant portion of forests to agricultural
lands giving landless poor an opportunity to contribute to the national economy and
alleviate poverty. The author seems to believe that there is limited potential for synergies
between poverty alleviation and biodiversity conservation. Providing evidence such as
improving the efficiency of timber production for example; where new technologies are
used to improve efficiency but improved efficiency ushers in further environmental
destruction. Thomas et al. (2003) empirical analysis concludes that forest loss is positively
correlated with economic growth. Adams et al. (2004) brings into light the social
implications of conservation such as eviction of people to create protected areas would
have negative social implications, it is acknowledged that without the support of the local
communities protected areas cannot last. Ninan & Sathyapalan (2005) states in line with the
opinion of Jyothis (2002) that the opportunity costs for biodiversity are high (study
conducted in Western Ghats), this is especially true for agricultural lands and the
households within bio-diverse areas have to cope with external costs caused by the
surrounding wildlife. Ninan et al. (2001) claims that even with the associated costs the
household’s perceived conservation as an important factor and had a positive attitude
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towards conservation, villagers on average spend 25.8 days on participatory conservation
activities.
It should be noted that areas protected for biodiversity are regions where agriculture is
abundant; this is true in the case of Sri Lanka as well. As mentioned above policies tend to
focus more on increasing the productivity of agriculture rather than on sustainability. It is
clear that poverty is a contributor for biodiversity loss and further biodiversity loss would
threaten the economy of the regions thereby increasing the levels of poverty.
McNeely & Scherr (2001) introduces a type of agriculture named “eco-agriculture” where
productivity of agriculture is improved on already farmed land reducing habitat destruction,
linking uncultivated land through farms, establishing protected areas, imitating natural
habitats with the use of perennial plants, use of pollution less methods of farming and
adapting resource management policies to enhance habitat quality within the regions. This
report would be based on the above best practises and to research on how to integrate eco
agriculture into microfinancing institutions.
2.7 Microfinance and Biodiversity Conservation
Government policies and other global initiatives to protect biodiversity exists but as
evidence suggests the best results would be attained if the local populations within these
regions assist these initiatives, therefore microfinancing institutions could assist in
biodiversity conservation in a manner such the local population participation can be
ensured in an integrated program which would alleviate poverty while ensuring
sustainability and biodiversity conservation.
Focusing on eco-agriculture microfinancing institutions would be able to support and
maintain the adoption of eco-agriculture; the institutions could finance the use of proven
technologies which assists sustainability and to create a scheme where clients receive a
conservation payment scheme to follow best practises. Furthermore microfinancing would
be able to assist the populations within the regions to diversify their income and to increase
income generation. Microfinancing institutions could also assist in setting up eco-businesses
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thereby ensuring a poverty alleviation scheme which would also protect biodiversity. Thus
creating an environment where sustainable use of natural resources, sustainable livelihoods
and sustainable microfinancing institutions can be established.
Sarvodaya claims to promote agriculture as profit making enterprise and provide necessary
training for this purpose. The organization also introduces new crops and crop varieties
which increase biodiversity. An important step towards increased knowledge sharing
Sarvodaya has set up an agri-clinic project where the latest research information and
relevant data from the Sri Lankan Department of Agriculture, the University of Peradeniya,
and other organizations are transferred to the farmers through leaflets, booklets, video CDs,
and e-books etc. The success of the program will be evaluated through the gathered primary
data to answer the research questions.
In the literature review the paper has discussed the relationship between poverty and
biodiversity/environmental conservation and the relationship between microfinance and
poverty also has been discussed. Therefore it can be deduced that alleviating poverty
through microfinancing can conserve biodiversity linking microfinance to
biodiversity/environmental conservation. The paper will further discuss on the relevant
methods to be employed to ensure biodiversity/environmental conservation in the latter
chapters.
2.8 Conclusion
Therefore it can be recognized that poverty, biodiversity and microfinance are linked and
alleviating poverty has to be achieved ensuring that the environment is not destroyed.
Further that microfinance institutions has an impact on poverty alleviation but distribution
schemes have to be altered to ensure that the “ultra-poor” receives financial services.
Therefore in this report, firstly it would be established “if” micro-financial services do reach
the poorest in Sri Lanka, then on the existing programs in Sri Lanka which are put forward in
order to protect biodiversity, to investigate on how sustainable microfinancing programs
integrated with biodiversity protection could be and finally to suggest on how to improve
microfinancing programs to distribution and biodiversity conservation.
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Damages to the ecosystem services
can cause substantial economic and
health costs. The collapse of the
Newfoundland fishery due to
overfishing caused the loss of tens
of thousands of jobs. Income
support and other costs added up
to 2 billon US dollars.
(Source: Millennium Ecosystem Assessment)
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Chapter Overview
This chapter would firstly discuss the research perspective followed for the research
followed by the research design. The research design explains on the primary data collection
methods used and as to why the said methods were used. The analysis of the data and
presentation is then explained followed by explanations on validity, reliability,
generalisibility and ethical considerations.
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3.1 Research Perspective
This research adopted the philosophy of an “interpretivist”, as individuals are unique and do
not necessarily behave in set patterns. This is in contrast to the positivist school of thought
where the tradition tends to be closest to a natural scientists view Saunders et al (2007).
The argument lies in the opinion that aspects of social factors and financial aspects within
the context of this report are too complex to be theorized within the boundaries of definite
laws. It is simply interpreting one’s environment on his/her experiences, Saunders et al.
(2007) emphasizes the human factor in research where differences are drawn out between
conducting research on objects and humans. The traditions of this thought derives from
phenomenology where we as humans attempt to make sense of the world around us and
symbolic interactionism where we are in a continual process of attempting to make sense of
the world around us Saunders et al. (2007). The ontological position taken in the research is
subjectivist as social trends are directed from the perceptions and the actions which follow
the perceptions by the “social actors”.
For this research both qualitative and quantitative data were collected as a mixture of both
research methods would provide the answers to the questions explored in this research
project. To ensure that the answers are valid, techniques varying from quantitative to
qualitative such as interviews questionnaires, observation and documentation reviews were
employed. A combination of the deductive/inductive approach Jewell (2008) was be used as
it is used to test theories as well as building theories. The research will first begin by
reviewing research on available academic theories formed by other researchers and then
followed by testing the validity of the said theories, this would be followed by
recommendations and comments of the tested theories would be formed and discussed
respectively.
3.2 Research Design
For the purpose of this research the chosen strategy is the survey strategy as stated in
Saunders et al. (2007), the said strategy would include questionnaires, observations, and
interviews. The strategy is also associated with the deductive approach which will be used.
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Where correctly implemented and a reasonable sampling strategy is used the flexibility over
the research is high with the survey strategy. The disadvantages of this strategy, for example,
in questionnaires is that depending on the questionnaires itself and other factors such as
the target population can have a great effect on the results and thus the research as a whole
would be affected.
3.3 Primary Data Collection Methods
3.3.1 Interviews:-
This research will use interviews to explore the research objectives and questions
mentioned above. 2-3 individuals will be interviewed in order to cover the research
objectives. Senior officers from the Samurdhi Authority and/or the Sarvodaya Economic
Enterprise Development Services will be interviewed in order to answer the research
questions 1 and 2. The interviews would be one on one non-standardized as the interviews
would attempt to answer different research questions. The interviews would be over the
telephone and would approximately last 15 to 20 minutes. The interviews would be text
recorded for analysis later. Interviews will allow flexibility within the research and allow first
hand information to analyse how the administration works and how the administration
considers the ground situations to be. This will allow the comparison between beneficiary
opinion and administrative opinion when the questionnaires from SEEDS and Samurdhi
beneficiaries are analysed against the interviews. Alexandra Michailidou a lecturer at the
Technological educational institute of Ionian Islands, department of organic agriculture,
Greece will provide me with information as to why biodiversity conservation is important
from an environmental and food security perspective.
3.3.2 Questionnaires:-
Questionnaires will be used to assess the ground reality of the micro financing institutions,
the questioner would attempt to explore the credit facilities given and the ease of obtaining
credit facilities from MFI’s. They would be self administered and delivered and collected by
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hand. The respondents are expected to be literate but the majority are not expected to be
computer literate therefore delivery by hand was considered, confidence that the correct
persons responded is high as the questionnaires would be checked at collection.
Respondent’s answers could be slightly distorted as they might seek external consultation
for answering, the response rate is expected to be high as the questionnaires would be
delivered by hand and the collector would ensure that as many questionnaires as possible
would be returned.
The questionnaire mainly consists of closed ended questions, but some open ended
questions would be included to receive data such as income, age savings and loans. Data
which would be vital for analysis aligned with the objectives of the research. Age, race and
gender would be recorded to examine if there are disparities of income level or apparent
trends of obtaining financial services related to any of the above mentioned categories.
Data such as monthly income and the ease of obtaining the services would be collected to
analyse whether the population below the poverty line are finding it difficult to obtain
services. Provision of collateral, amount of savings and loans are also recorded to find out if
the provisions of services are related to the above. This is important as most people under
the poverty line might not be able to provide collateral as pointed out by Coleman (2006).
Occupation and status of occupation is also collected to investigate if the beneficiaries are
mainly involved in agriculture, status of the occupation and data with regard to pension
schemes are also collected. Academics also draw attention to the fact that most of the
population below the poverty line would be most affected when a “shock” would occur, in
the form of sickness, death etc. or the business or occupation be affected by a natural
disaster. In order to investigate this, questions have been formed to collect data if the
households were affected and to what extent the microfinancing institutions assisted on
these occasions.
Questions are also formed to evaluate the respondent’s knowledge on
biodiversity/environment conservation. The respondents are asked to “rate” their
knowledge on biodiversity/environment conservation, in addition the individuals schooling
level is also questioned. If the individuals are aware of biodiversity/environment
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conservation questions are formed to question as to where they learnt about
biodiversity/environment conservation.
3.4 The Analysis and Presentation of Data
The quantitative data obtained would be analysed through SPSS the statistics package
available and the analysis would involve
Univariate – where one variable at a time is taken into consideration and analysed. Within
the context of this research this could be the level of income distribution.
Bivariate – where two variables are taken into consideration and analysed. Within the
context of this research this could be the varying level of income and the distribution of
credit though the range of income level.
For both Univariate and Bivariate analysis, charts and other graphical illustration would be
used. Other statistical approaches would be used to examine and analyse the data and will
include correlation coefficient, independent-sample T tests and one-way ANOVA tests.
3.5 Results Quality
3.5.1 Validity
Where validity is concerned, this would depend on how intricately the research is planned
and the employed methods for analysis and presentation. Measures should be taken into
consideration when the questions for the questionnaires are designed and interview
questions should also follow the same principle. Some issues with regard to validity involve
history where the data is collected shortly after a major change within the subject area,
testing where the respondents might think that answering truthfully might be to their
disadvantage could be tempted to fabricate results. The above mentioned issues are hard to
circumnavigate but with careful planning the effect of such distortions can be minimized.
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3.5.2 Reliability
Where reliability is concerned four issues should be addressed according to Robson (2002)
in Saunders et al (2007):-
Participant error which is prevalent to reduce this is not easy as it is out of the control of the
researcher, but when it comes to interviews the interviewees are chosen on a professional
level and are expected to be informed in their respective field.
Participant bias is also another reliability issue as when the interviews in SEEDS and
Samurdhi are taken the authorities might tend to favour their strategies but this can be
corrected and analysed by the questioners by the beneficiaries. Also keeping in mind that
the respondents to the questioners could be overly critical about the administration but
getting answers from both ends would assist me in getting a clearer realistic view of the
ground situation.
Observer error is also prevalent and can be mitigated by following a strict structure to the
interview process and to be prepared well beforehand.
Observer bias can be mitigated by following a high standard of professionalism and to be
aware of the situation. When interpreting the results I should keep in mind to be as neutral
as possible.
3.5.3 Generalisibility
Generalisibility of the research is limited within countries but some aspects of the research
maybe borrowed within the continent. This is due to the fact that many microfinancing
programs are available and are practised over the world and they are all structured
differently.
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3.6 Ethical Considertions
The Coventry University Ethics Procedure provided in the BES Ethics Student Handbook
would be used and followed on during the research. The ethics checklist was filled and none
of the questions were answered yes and the form would be signed and handed in
appropriately.
The primary data collected in the research would not involve personal information on
individual respondents and the questioner would be structured as such that data protection
act would not be violated. The data collected on SEEDS would be kept in confidentiality and
professionalism would be maintained throughout my research. The supervisor would be
informed and permission sought before the interviews are taken and the questioners sent.
The interviewees would be informed that the interviews are text recorded and their
permission sought beforehand.
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CHAPTER FOUR: DATA ANALYSIS
4.1 Chapter Overview
This chapter will address the research questions put forward in the first chapter. The
gathered primary data is analysed in this chapter, the findings are first presented followed
by the analysis. Whether microfinance institutions are reaching the grass roots will be first
discussed and the results analysed. Microfinance assures to improve the living conditions of
the poor, this will be analysed in the second part of this chapter. The awareness of
biodiversity within the community focussing on the farming community is then analysed.
Finally methods of improving micro-financial institutional reach, integration of biodiversity
and methods of tackling the food crisis through microfinance are discussed.
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4.2 Population Key Characteristics
Income groups will be defined as follows for the purposes of this report; the official national
poverty line of 2937 rupees a month as stated in the (Poverty Indicators, 2008) document is
used:
Income Group Definition
Ultra Poor Up to 67 % of poverty line: Rs. 1,967 or less
Poor 67-100 % of poverty line: Rs. 1,968 - 2,937
Near poor 100-150% of poverty line: Rs. 2,938 - 4,405
Non poor More than 150% of poverty line: Rs. 4,406
Table 1
The gathered primary data illustrate a
Primary Data Income Classification
predominantly “non poor” slice of the chart.
The gathered data when compared with the
national Sri Lankan poverty level of 15.7%
(Poverty Indicators, 2008) reflect the national
poverty level closely. The ultra poor and the
poor both represent a total of 19.36% of the
population living below the poverty line.
The difference between the national
Figure 1
average and the level represented here
is due to the fact that this research Schooling Characteristics
mainly consisted of people with low
incomes.
Figure 2 illustrates the schooling levels of
the population in consideration for the
purpose of this research. Here too the
results are closely representative of the
national average for school enrolment.
S Figure 2
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Mean income is Rs. 8,261 a month which is
Rs. 99,132 a year (US$ 920), which is lower
than the national average of US$ 1719, PPP
US$ 4700 (World Bank 2007)
Income distribution of the population is
illustrated in Figure 3 which shows a slightly
positive skewness of 1.528 indicating that
some of the individuals have high income
levels. The standard deviation Rs. 7,177 is
about 86 % of the mean Rs. 8,261 indicating
that on average there is not too much of Figure 3
variations. Negative kurtosis of 2.204
indicates a flat distribution of income level in the gathered data 1.
4.3 Microfinance and the “Ultra Poor”
4.3.1 Introduction
The first research question was to investigate “if” the microfinancing institutions reached
the poorest of the population. For this purpose, the paper will attempt to evaluate the
institution’s efficiency in distributing the financial services. Primary data was gathered as to
how easy financial services were to obtain, beneficiaries were questioned this through the
questionnaire. Comparisons and analysis will be carried out on the impact of income level,
availability of collateral, amount of savings has on the ease of obtaining financial services.
Other factors such as gender and race are also analysed in order to investigate if they have
an impact when attempting to obtain financial services.
1
Appendix I Table xi
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4.3.2 Income and Ease of Obtaining Micro-Financial Services
4.3.2.1 Findings
The relationship between income classification and the ease of obtaining financial services
was firstly investigated using cross tabulation. A test was carried out to check if a
relationship was evident between the two variables, the Pearson Chi Square value was
15.451 and the degrees of freedom were 6 while the critical value was 12.591 therefore as
15.451 > 12.591 it can be deduced
that there is a relationship between
the two variables.
Pearson product-moment
correlation coefficient is used to
investigate the relationship further.
Preliminary checks were carried out
to ensure that there was no violation
of the assumptions of normality,
linearity and homoscedasticity.
There was a weak positive
correlation between the variables
Figure 4 Cohen (1988), r = .247, n = 93, p
= .0202, with the ease of obtaining
financial services becoming easier with increasing levels of income. Figure 4 shows the
percentages of the individuals and how “difficult” individuals perceived financial services
were to obtain. The results show that a vast majority of the “ultra poor” and the “poor”
found it difficult to obtain financial services. Income means and the ease of obtaining
financial services were compared to investigate if individuals with more income found it
easier to obtain financial services from the institutions, results as illustrated in figure 5
individuals from higher mean income levels (Rs. 11,177) categorized as non poor found it
the easiest to obtain financial services while individuals with much lower mean income
2
Appendix I, Table iii
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levels (Rs. 6340) found it
difficult to obtain financial
services from microfinancing
institutions, the results are
illustrated in figure 5.
Investigations were carried
out to find out if there was a
difference between “ease of
Figure 5 obtaining financial services”
and microfinancing
institutions. A lesser
percentage of SEEDS
beneficiaries thought that
services were diffcult to
obtain than Samurdhi
beneficiaries. However a
relatively larger percentage
of Samurdhi beneficiaries
found it easier to obtain
services. A significant
propotion (60%) of SEEDS
beneficiaries rated the
Figure 6 difculty as average.
4.3.2.2 Analysis
Preliminary results indicate that the mirofinancing institutions do not reach the “ultra poor”
as results indicate that individuals classified as “ultra poor”or “poor” find it difficult to
obtain financial services. Correlation results, mean income comparisons are evidence to the
above claim. The results are consistent with the views of Coleman (2006) and Shaw (2004)
where the authors claim that microfinancing institutions do not reach the “ultra poor”, and
are conflicting with the opinions of Khandker (2003) and Montgomery (2005).
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4.3.3 Availability of Collateral and Ease of Obtaining Micro-Financial Services
4.3.3.1 Findings
Further investigations were conducted to find out if the availability of collateral had
influenced the institutions. The relationship between the ownership of land and the ease of
obtaining financial services was investigated using Pearson product-moment correlation
coefficient. Preliminary checks were
carried out as before and there was a
weak positive correlation between the
variables Cohen (1988), r = .158, n = 93,
p = .1413, with the ease of obtaining
financial services becoming easier with
increasing levels collateral. When the
means were compared individuals with
Figure 7
more land found it easier to obtain
financial services as illustrated in figure 7. A significant difference can be seen where
individuals with a mean of 253
perches finding it easy to obtain
services while individuals who
owned lands in perches with
means of 142 and 140 found it
“average” and “hard” to obtain
financial services respectively.
As illustrated in figure 8 the
“ultra poor” has no ownership of
land at all.
Figure 8
3
Appendix I, Table v
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4.3.3.2 Analysis
Results indicate that collateral does play an important role in the decision making process of
the institutions as shown above. The results are consistent with the view of Coleman (2006)
where the author claims that the microfinancing institutions rely on data such as collateral
on evaluating an individual’s creditworthiness. As the “ultra poor” of the population has no
land ownership financial services provided by the institutions will not reach the “ultra poor”
4.3.4 Savings and Ease of Obtaining Micro-Financial Services
4.3.4.1 Findings
Savings and outstanding loans were investigated using Pearson product-moment correlation
coefficient, a medium positive
correlation between the
variables Cohen (1988), r
= .312, n = 93, p = .0034, where
increasing savings saw an
increasing amount of
outstanding loans. Mean
savings are standing at 13,532
Rupees with a standard
deviation of 19,786 Rupees.
Figure 9
Investigated using Pearson
product-moment correlation coefficient, a weak positive correlation between the variables
Cohen (1988), r = .211, n = 93, p = .0485, where individuals with higher savings found it
easier to obtain financial services. The means of the above relationship are plotted on Figure
9: which shows that individuals with higher savings found it easier to obtain financial
services from microfinancing institutions. As figure 10 illustrates the majority of poorest
have savings less than Rs. 5000.
4
Appendix I, Table vii
5
Appendix I, Table ix
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Income level and outstanding
loans were also investigated
using Pearson product-moment
correlation coefficient, checks
were carried out as before and
there was a medium positive
correlation between the variables
Cohen (1988), r = .392, n = 93, p
< .00056, with outstanding loans
increasing with increasing levels
of income. The mean outstanding
loan was 26,891 Rupees.
Figure 10
4.3.4.2 Analysis
Results indicate that the ultra poor and the poor again will find it difficult to obtain financial
services due to a lack of savings as institutions seem to prefer to provide credit to those
with higher savings. This is evident by the results obtained through correlation and other
comparisons presented above. The results are further proven by the correlations carried out
between outstanding loan amounts and income levels.
4.3.5 Gender, Race and the Ease of Obtaining Micro-Financial Services
4.3.5.1 Findings
Investigations were carried out to find out if gender had affected the ease of obtaining
financial services. As illustrated in figure 11 no significant difference was observed. Males
did find it marginally easier to obtain finances but this maybe due to the fact that males
have a better financial standing than females thus microfinancing institutions would be less
6
Appendix I, Table vi
35 | P a g e

reluctant provide services to males. To investigate this, mean incomes of males and females
were compared.
Results indicated that male mean
income per month is Rs. 9,742 while
female income per month is Rs.
5,437.
To investigate if race was a factor
in the ease of obtaining finance,
cross tabulation was performed.
Results indicate that a vast majority
of Moors find it difficult to obtain
financial services while the
Figure 11
Sinhalese find it the least difficult to
obtain financial services. The
Sinhalese even in comparison to
Tamils find it the least difficult to
obtain financial services. Only 36.1%
of the Sinhalese find it difficult to
obtain services while 55.6% of the
Tamils and 71.4% of the moors find
it difficult to obtain services from
microfinancing institutions. In order
to investigate if the income was
manipulating the results the mean
Figure 12
incomes of the different races were compared. Results indicate there is a significant
difference of income levels between the races which might have influenced the results.
Mean incomes of Rs. 9052, 3450, 57427 for Sinhalese, Tamils and Moors were recorded thus
indicating that the income levels would have influenced the ease of obtaining finances to
7
Appendix I, Table xii
36 | P a g e

the Sinhalese. However it can be noticed that the Moors have a higher income than Tamils
yet the Moors found it more difficult to obtain services compared with Tamils therefore to
investigate the
relationship further
possession of collateral
were compared. Results
showed that the average
Moor individual was in
possession of a 39.29
perches (mean) of land
compared with the
average Tamil individual
in possession of 3.33
perches of land8 again
leaving the Moor
Figure 13 individual a more
attractive client. Furthermore savings of the two races were compared; the mean savings of
Moor and Tamils were Rs 7,457 and 1,616 respectively. To ensure that no other factor is
effecting the decision of micro-financing institutions a further analysis of industry was
performed on the basis that it maybe that the Moor individuals were in a specific industry
that was considered risky by the institutions. However results as illustrated in figure 14
show that there is no significant difference in the industries the different races are
employed in, the Moors are slightly more biased towards manufacturing but the difference
is relatively minor.
8
Appendix I, Table xiii
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Figure 14
4.3.5.2 Analysis
The results indicate that there is no discrimination by micro-financial organizations with
regard to gender, there is a slight disparity but it is safe to assume the differences seen in
the ease of obtaining financial services were more correlated to income rather than gender.
Where race is concerned there seems to be “some” discrimination towards the Moors.
Results shows a significant difference between the Sinhalese and the other races but the
Sinhalese were in a much better financial position than the other races therefore the ease of
obtaining finances for the Sinhalese would have been relatively easy. However between the
Tamils and Moors the Moors were in a better financial position but still found more difficult
to obtain financial services therefore with the results obtained in this research it can be
concluded that there is evidence of “some” discrimination towards the Moors by
microfinancing institutions.
4.4 Microfinance and Beneficiary Living Conditions
4.4.1 Introduction
The second research question focuses on “if” the provision of microfinance improved the
living condition of the beneficiaries. For this purpose the answers of the beneficiaries will be
38 | P a g e

analysed. In addition if the beneficiaries were assisted in times of “shock” will be analysed
again using the answers gathered from the questionnaires.
4.4.2 Microfinance and Living Condition Improvements
4.4.2.1 Findings
Results indicate that the majority of the beneficiaries, 68.7 % (see figure 12) think that the
provision of microfinance has improved
their living conditions. To analyse it further
the amount of loans taken out by
individuals and their opinion on the
provision of microfinance were compared.
Results indicated that the majority of the
individuals who claimed that the provision
of microfinance did not improve living
conditions were not recipients of micro-
Figure 15 credit. The individuals would have used
other micro-financial services such as
micro-insurance or saving schemes
which would not have affected their
overall living conditions in any
significant manner (see figure 13). 45.8%
of the individuals who claimed that
microfinance did not improve living
conditions had not received micro-
credit. Therefore it can be deduced that
micro-credit plays an important role in
improving the living conditions of the
beneficiaries.
Figure 16
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A comparison was
conducted between
the different
classifications of the
poverty pyramid and
results indicate that
the majority of ultra
poor and the poor
found that their
living conditions
were not improved
by the provision of
Figure 17 microfinance. To
investigate further
the loan amounts given out to the ultra poor and poor were evaluated. As illustrated in
figure 18 the ultra poor did not receive any loans exceeding Rs.5000.
4.4.2.2 Analysis
The provision of microfinance
largely does seem to improve
the living conditions of the
beneficiaries as evident from
the above results. Micro credit
seems to be the most
important factor in improving
the living conditions as evident
from the results. This is further
evident when the comparisons
of the different classifications
Figure 18
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of the poverty pyramid are compared. The ultra poor who largely found the provision of
microfinance had not improved the living standards were also the least beneficiary for
microcredit which as explained above seems to be the most important factor governing the
improvement of living conditions.
4.4.3 Microfinance and “Financial Shocks”
4.4.3.1 Findings
The ultra poor generally affected most in times of financial shocks when they need money
urgently for health or occupational/entrepreneural reasons, microfinance institutions claim
that funds from group savings are available for these situations. To investigate this cross-
tabulation analysis was carried out for household health situations. Results (See figure 19)
indicate that only in 36.5% of
the cases when a household
member was sick the
microfinancing institution
assisted. Where accidents are
concerned only in 14.3% of
the cases the microfinancing
institution assisted.
Figure 19
Furthermore as illustrated in figure 20 the
ultra poor have not been assisted at all by
the institution in times of financial shocks.
The non poor has been assisted the most,
interestingly the poor has been assisted
more than the near poor.
Further investigations were carried out to Figure 21
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distinguish if microfinancing institutions assisted beneficiaries in times of financial shock in
their occupations. Results indicate that the microfinancing institutions were more eager to
assist beneficiaries when a financial occurred in their occupations. 59.1% of the flood
victims and 47.2% (See figure 22)
of the drought victims were
assisted. Figure 23 illustrates
the assistance given to different
classifications of people. Results
show that the ultra poor were
not assisted at all. The non poor
were the most assisted the near
poor then the poor.
Further investigations were
carried out to evaluate the
adequacy of the assistance
Figure 22
given to the beneficiaries.
Where flood victims are
concerned a majority of the
recipients found the assistance
satisfactory to average but
where drought victims were
concerned the majority of the
victims found the assistance
average to unsatisfactory. In
order to ascertain if there were
any other factors involved with
the satisfactory levels of flood
Figure 23
and drought victims an industry
wise comparison was carried out.
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The results (See figure 24)
do not provide any evidence
of vast differences of
satisfactory levels, most of
the victims were
concentrated in agriculture,
the only notable aspect is
that floods had not affected
services while droughts had.
Investigations were carried
Figure 24
out to evaluate the
satisfactory levels of the beneficiaries. Initial results indicate that the beneficiaries had
largely rated the services “average”, where 64.8% of the beneficiaries rating the services
average. While 15.2% rates the
services “satisfactory and 20.3%
rating the services unsatisfactory,
above results are depicted in
figure 26. The means of the loan
amounts of the beneficiaries were
compared to investigate if there
was a relationship between the
ratings and the granted loan
amounts. Results indicate that
with increasing loan amounts the
ratings had risen, the mean
outstanding loan amount for
Figure 25 beneficiaries who were satisfied
with the services were Rs. 405009
9
Appendix I, Table xiii
43 | P a g e

while mean outstanding loans for beneficiaries who rated the services average and
unsatisfactory were Rs. 33552 and 14140 respectively (See figure 27).
Figure 26 Figure 27
The microfinance institution satisfactory levels as perceived by their beneficiaries were
compared to investigate if any differences were present. As illustrated in figure 28
beneficiaries of SEEDS have rated the institution better than Samurdhi.
Figure 28
44 | P a g e

As figure 29 illustrates none of
the ultra poor are satisfied
with the services provided by
the microfinance institutions.
Figure 29
4.4.3.2 Analysis
The microfinance institutions studied seems to be reluctant to assist household situations
compared to occupational financial shock situations. The increase in the percentage of
assistance when compared to household situations maybe due to the fact that occupations
would affect the microfinancing institutions more as occupations directly affect loan
repayment. Therefore a motive exists to assist occupational financial shock situations rather
than household situations. In household shock situations the ultra poor was the least
assisted, while they are the classification of the poverty pyramid that require the most
assistance but they would be the least attractive for the micro-financial institutions to assist
due to their lack of repayment capacity. Where occupational financial shock situations
occurred none of the ultra poor had been assisted due to the same reasons laid out above.
The importance of micro-credit to the poor is further strengthened by the evidence
provided above, where individuals who received higher levels of credit giving higher ratings
of satisfaction. Evidence also reiterates the lack of institutional reach towards the ultra poor
as all individuals classified as ultra poor giving a maximum rating of average to the
institutions and a significant amount (50%) being unsatisfied with the services provided by
the microfinance institutions.
45 | P a g e

4.5 Knowledge of Agro/Biodiversity within the Beneficiaries
4.5.1 Findings
Investigations were carried out to explore answers to the third research question, in order
to evaluate the question the answers given by the beneficiaries were evaluated. Initial
results show that 69.2% of the beneficiaries were aware of biodiversity conservation, 69.6%
of the beneficiaries were aware of agro biodiversity and 75% of the beneficiaries were
aware of environmental conservation.
Furthermore analysis was conducted as to where the beneficiaries were informed about
biodiversity. Schooling and the knowledge of biodiversity conservation was first analysed, A
test was carried out to check if a relationship was evident between the two variables, the
Pearson Chi Square value
was 11.533 and the degrees
of freedom were 3 while the
critical value is 7.814
therefore as 11.533 > 7.814
it can be deduced that there
is a relationship between
the two variables. Figure 20
shows that the majority of
the individuals who had no
schooling were not aware of
biodiversity conservation
and the percentage of
Figure 30
awareness rises with
increasing number of schooling years.
46 | P a g e

It is important to investigate
the awareness of
agro/biodiversity knowledge
of the farmers as the farmers
have a more direct impact on
agro/biodiversity. Results as
illustrated in figure 32
indicate that 72.3% of the
farmers were aware of
biodiversity and as illustrated
in figure 31, 75.8% of the
farmers were aware of agro-
Figure 31
biodiversity. To investigate
further the source of
knowledge of
argo/biodiversity was
analysed. Results (See figure
33) indicate that the vast
majority of the farmers
gained knowledge on
agricultural knowledge in
school. But a relatively
substantial percentage gained
knowledge through media
Figure 32 and seminars.
47 | P a g e

Figure 33
Investigations were carried out to explore the knowledge of the broader subject of
environmental conservation. Results as illustrated in figure 34 show that a vast majority of
the population is
aware of
environmental
conservation. 75 % of
the individuals who
participated in the
survey were aware of
environmental
conservation.
Furthermore the
awareness on
Figure 34
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environmental
conservation with regard to
farmers was investigated.
As illustrated in figure 25
77.3% of the farmers are
aware of environmental
conservation. While
individuals in the service
sector are the most aware
of environmental concerns
individuals in the
manufacturing sector are
the least informed.
Figure 35
Educational levels of the different sectors were compared to identify the difference
between awareness of
environmental and
agro/biodiversity
conservation as individuals
employed in the
manufacturing sector
seemed to be the least
informed on all subjects. As
shown in figure 36 the
services sector had the most
educated while the
agricultural sector had the
least educated population.
As to why the manufacturing
Figure 36 sector employees were
49 | P a g e

lesser informed than employees in the agricultural sector will be discussed in the analysis.
To analyse the knowledge of environmental and agro/biodiversity further a gender wise
comparison was undertaken.
As shown in figure 37 males
were seen slightly more aware
of the subjects than females in
order to investigate the reason
behind the negligible disparity
the educational level between
males and females were
compared. Figure 38 shows
that there is a slight difference
in educational level between
males and females. The
percentage of females not
Figure 37
having any schooling at all was
9.7% while the male
percentage was 6.6%. The vast
majority of both sexes seem to
have studied up to GCE
ordinary level while 3.3% of
the surveyed individuals
having attended university.
Further investigations were
carried out to explore if there
were any differences of
awareness between races.
Results as illustrated in figure
Figure 38
39 show that the Sinhalese
were the most aware while the Moors were the least informed about conservation related
50 | P a g e

issues. To investigate the
reason behind this the
educational levels of the
different races were
compared. Results as shown
in figure 40 indicate that the
Moors had a better
educational background
than the Tamils but were
still less informed about
conservation. To clarify this,
an industry wise
classification was
undertaken. Results show
Figure 39
that a higher percentage of
Moors are employed in the manufacturing sector and as results shown earlier suggested
employees in the manufacturing sector were less informed about conservation.
Figure 40
Figure 41
51 | P a g e

The beneficiaries of microfinance were asked to rate how important they perceived
environmental and agro/biodiversity conservation is, results as illustrated in figure 42 show
that only a minority rated
the importance of
conservation to be low.
Further investigations were
carried out comparing the
importance of conservation
and employees of different
industries. As illustrated in
figure 43 a segment of
employees in the
manufacturing sector found
Figure 42
the importance of
conservation to be low. A
significant proportion of
employees in the agricultural
sector perceived that
conservation was important
while employees within the
services sector found the
importance to be more
average.
A comparison between the
different microfinance
Figure 43 organization beneficiaries
and how important they thought conservation was carried out. As illustrated in figure 44
a majority of SEEDS beneficiaries perceived conservation to be of high importance.
52 | P a g e

Figure 44
4.5.2 Analysis
Evidence suggests that there is a direct relationship between education and awareness on
environmental and agro/biodiversity awareness. A majority of farmers do seem to be aware
of conservation and they do seem to rate the importance of conservation as high. This is
mainly due to the nature of their occupation in contrast employees in the manufacturing
sector seem to be the least aware of conservation and they relatively perceived
conservation to be less important. This is significant as unlike the services sector, the
manufacturing sector will have an impact on biodiversity. For an example sand miners or
brick produces who are in the manufacturing sector unaware or perceiving that biodiversity
conservation might be less important might engage in activities which could affect the
sensitive ecosystems. In the case of sand miners they could over mine threatening the
sustainability of the ecosystems in turn threatening biodiversity. Moors and their awareness
of conservation were more the result of their vocation rather than education as evident in
the data produced above. Where microfinance institutions are concerned beneficiaries of
SEEDS seems to be more informed about conservational issues than their counterparts in
Samurdhi. Therefore it can be deduced that the efforts of agri-clinics organized by SEEDS are
effective in distributing information to the farmers in rural areas. The results are promising
as a significant proportion of the population having an understanding of conservation and
its effects.
53 | P a g e

CHAPTER FIVE: CONCLUSIONS
5.1 Chapter Overview
This chapter would address the research questions and objectives directly and to provide
concluding remarks on the analysis provided in the previous chapter. Recommendations
which address the last research question is also presented in this chapter along with the
research limitations and further research.
54 | P a g e

5.2 Conclusions
5.2.1 Microfinance, the “Ultra Poor” and Other Factors
Evidence collected for this research suggests that microfinance does not reach the ultra
poor. Evidence suggests that the services provided by the microfinance institutions reach
the relatively wealthy of the poor. Findings and subsequent analysis shows that with
increased income levels, availability of collateral and savings levels affect the ease of
obtaining financial services from the institutions. Decision characteristics have resemblance
to commercial financial institutions, therefore the ultra poor find it difficult to obtain
services from the microfinancing institutions.
Gender discrimination was not evident in the analysis although discrimination with regard
to race was observed. The Moors seemed to be discriminated as suggested in the analysis.
5.2.2 Microfinance and Living Conditions
The living conditions of the beneficiaries have improved, evidence suggest that the biggest
factor in improving the living conditions was the provision of credit. Analysis also suggests
that the institutions assisted occupational financial shocks more than household shocks. The
living conditions of the ultra poor is the least improved as the provision of credit to the ultra
poor has been low. Therefore this further strengthens the case of microfinance not reaching
the grass roots level of poverty.
5.2.3 Agro/Biodiversity Conservation and Microfinance
The majority of the beneficiaries, especially beneficiaries in the agriculture sector do seem
to be aware of agro/biodiversity conservation. However employees in the manufacturing
sector seem to be lacking in awareness of agro/biodiversity conservation. Results and
subsequent analysis also indicate that beneficiaries of SEEDS are more informed about
environmental issues than Samurdhi beneficiaries. Institutions do attempt to advocate
55 | P a g e

environmentally friendly practises but results indicate that improvements in the structure of
educating the beneficiaries are required.
5.3 Recommendations
5.3.1 Improving Micro-Financial Institutional Reach
The reluctance of microfinance institutions to reach the ultra poor and poor (as discussed
earlier in the chapter) are mainly driven by the fact that the ultra poor and the poor have a
low loan repayment capacity. In order to fully appreciate the market segment of the ultra
poor and the poor, using the primary data gathered for this research the mean incomes and
percentage of the ultra poor and poor were analysed. 7.5% of the population were classified
as ultra poor while 11.8% of the population classified as poor, mean income levels for the
categories were Rs. 521.53 and 2472.73 respectively. To place it in to perspective the
national population was considered (21,000,000) and then calculated the total income of
the classified groups of ultra poor and poor 10. The total annual income of the groups stand
at Rs. 83,384,126,280 (US$ 758,037,511.6), therefore the two income groups share a
significant amount of money between them. Calculations with regard to savings indicate
that the poor has mean savings amounting to Rs. 2,904.55, again at a national level this
turns out to be Rs. 7,197,474,900. A model can be developed to distribute microfinance to
the very poor and the poor a significant market segment which the institutions are failing to
reach effectively.
10
Ultra poor pop. (1575000), Poor pop. (2478000). Monthly income: Ultra poor (Rs. 821,252,250), Poor (Rs.
6,125,616,000)
56 | P a g e

The costs of banking with the very poor include risk of default, inaccessibility, the need for
extra support and the fact that the very poor are likely to obtain smaller loans therefore the
institutions obtain little interest. However a credit program can be formulated where first
the very poor are categorised in to two segments: employed and unemployed. The
employed would be given “credit with targeted education”; the costs of education can be
embedded in to the interest of the loan. Targeted education should defer from conventional
mass education, it should be given to the participants by local individuals who are experts in
the subject matter. The experts can be given an incentive to educate the very poor by giving
preferential rates of interest on loans and other privileges within the microfinancing
institution. Additionally payments can be paid to the experts with the costs recovered by
the margin of interest on the loan. This would keep the costs low while providing the very
poor with a sustainable educational system. Gathered data indicate that increasing levels of
education is correlated to increasing levels of income and it also indicates that even the
ultra poor are interested in education (See figure 45). Increased education would assist the
employed to gain higher levels of income which will result in higher levels of savings and
loans while reducing the risk of default.
Figure 45
57 | P a g e

The unemployed should also participate in the “credit with targeted education” program
and the institution will also assist them in finding employment. Employment could be given
to them through local employers. The local employers could provide the micro financing
institution with the requirements for employees and the microfinance institutions can filter
the unemployed to the target educational experts. The employers can also be given the
incentive of preferential interest rates for hiring through the institution. The microfinance
institution itself could initiate enterprises within the local areas with them bringing in higher
levels of knowledge in entrepreneurship thus developing sustainable and stable enterprises
in the locality. Employees working for the institution can also borrow from the institution.
The institution can deduct the payment for the loan from the wages of the employees. This
would guarantee the payments from the clients further reducing the risk involved with the
loan repayments. These exercises will increase the growth of the microfinance institution
and assist the very poor. The unemployed also after education and employment will
produce a much more attractive client.
Very Poor
unattractive, risky clients
Unemployed Employed
Credit with Targeted Credit with Targeted
Education Education
Assist in obtaining Increasing levels of
employment through income
clients or through the attractive, less risky
creation of enterprises clicents
Increasing levels of
income
attractive, less risky clients
58 | P a g e

Advantages of serving the poor for micro-financial institutions are over sighted by many
institutions. As described above the market segment of the very poor is considerable with
monies in the range of US$ 750 million. This niche market can be capitalised with less
competition market penetration at this point can be high, where only few of the ultra poor
and the poor are served. With schemes that would alleviate the economical conditions of
the very poor growth rates can be high thus sustainable microfinance institutions can be
developed.
5.3.2 Micro-Financial and Agro/Biodiversity Conservation Integration
The vast majority (98%) of the general population believes that agro/biodiversity is
important. On this basis it is possible to draw a conclusion that given the capital and other
expenses people will invest in environmentally friendly practises. An interview conducted
for the research, an executive of SEEDS stated that the institution does not assist any
enterprise which destroys the environment or biodiversity. Institutions should use a scheme
where conservation is encouraged rather than discouraging the destruction of biodiversity
without providing alternatives. As given the choice any individual would prefer to conserve
biodiversity, but if the individual is not given a choice the individual might reject the services
offered by the institution and go on to practise environmentally unfriendly practises.
Therefore the microfinancing institutions can create a scheme to appreciate conservation
efforts. Such a scheme could be based on eco-agriculture as presented in the literature
review, where individuals who follow the practises of eco-agriculture are given preference
for micro-credit. Furthermore the microfinancing institutions can assist in introducing new
technologies which assist conservation efforts and again give preference for the
implementation of such technologies which are proven to be environmentally friendly. The
institutions should also improve the educational system provided for rural farmers, in the
form of strengthening existing systems such as “agri-clinics” and initiating new systems.
The institutions can also assist the formation of new enterprises which are conservation
friendly such as organic production of tea, spices etc. Assist new initiatives by local
communities to promote eco-tourism, in situ and ex situ medicinal plant conservation
59 | P a g e

projects. Such assistance would assure a sustainable ecosystem for the local populations to
gain employment and income from while conserving biodiversity.
5.3.3 Food Crisis, Agro/Biodiversity Conservation and Microfinance
Based on information gathered from an interview with Alexandra Michailidou on
sustainable food production and biodiversity conservation and analysis and
recommendations based on this research the food crisis is discussed below:
Biodiversity and sustainable food production are linked as farm biodiversity would assist the
cycle of life in the farm to be more stable. Illustration for this would be the scenario where a
single disease will not destroy all plants in a forest due to the biodiversity present in forests,
whereas in a farm with less diversity a disease could destroy all crops. The different species
carry genes which can be used to prevent diseases and pests, for example use pheromones
from some insects to avoid some other insects etc. Microfinance institutions could assist in
this by means of education and promoting biodiversity conservation.
Agro biodiversity is important as the crop wild relatives are more resistant to pests and
diseases than hybrids. Hybrids are less resistant as the size of the product and other
characters are the focus but not their resistance to diseases. As pointed out in the literature
review the species which provide food source for humans have reduced dramatically which
in turn means that there are fewer opportunities for the growth and innovation required to
enhance agriculture. With fewer genes the plants are less adaptable to changing
environments thus further exposing agriculture to risks.
In order to tackle the problem small scale farms should be encouraged, focussing on quality
food production by local farmers who has the knowledge about the crop varieties should be
encouraged. This also serves another aspect of conservation as it encourages “on farm”
conservation, gene banks can also be used to protect biodiversity and theoretically the
genes could survive for 1000 years in a gene bank but if the variety is attempted to be
planted after 200 or 300 years the environment could have changed so much that its
survival is unsure. Whereas on farm conservation keeps the genes in nature therefore it
60 | P a g e

would evolve with the changing environment. Microfinance institutions again are relevant
here as small scale farmers mainly depend on micro-credit, therefore the institutions can
employ the position they hold in the farmers financial requirements to promote and
encourage agro/biodiversity conservation while producing a sustainable source of food.
5.4 Further Research and Research Limitations
Further research on the topic is required to formulate specific programs especially the
scheme of “credit with targeted education”. The scheme should be evaluated in detail and a
detailed report on the feasibility and implementation of the scheme investigated. Following
the report primary data should be gathered to evaluate the opinion of the beneficiaries on
the suggested scheme. One of the limitations to this research was the limited sample, the
range of the sample should be broadened in order to fully appreciate the scope of the
suggested scheme. Research is also required to fully investigate the discrimination with
regard to race which was pointed out in the analysis of the primary data. Further research is
also required to give attention to integrated biodiversity conservation schemes and again
evaluate the feasibility and gather primary data to appreciate the opinion of the general
public. This research has attempted to provide evidence that biodiversity conservation can
be successfully integrated to microfinance but the research lacks evidence as to how
successful it would be on the implementation stage therefore this also should be further
addressed. Lastly this research paper has concentrated on the agricultural aspects and food
production aspect and how to enhance the conservation efforts with regard to agriculture
but as evidence has shown the awareness of conservation in the manufacturing sector is
low and this issue should also be addressed.
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APPENDIX I
Classification
Frequency Percent Valid Percent Cumulative Percent
Valid Ultra poor 7 7.5% 7.5 7.5
Poor 11 11.8% 11.8 19.4
Near poor 16 17.2% 17.2 36.6
Non poor 59 63.4% 63.4 100.0
Total 93 100.0 100.0
Table ii
Schooling
Frequenc Percent Valid Cumulative
y Percent Percent
Valid n/a 7 7.5 7.6 7.6
o/l 66 71.0 71.7 79.3
a/l 17 18.3 18.5 97.8
universi 2 2.2 2.2 100.0
ty
Total 92 98.9 100.0
Missing System 1 1.1
Total 93 100.0
Table iii
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Correlation (Income & Ease of Obtaining Financial Services)
income Ease of
Obtaining
financial
Services
*
income Pearson Correlation 1.000 .247
Sig. (2-tailed) .020
N 93.000 88
*
Ease of Obtaining Pearson Correlation .247 1.000
financial Services
Sig. (2-tailed) .020
N 88 88.000
Table iv
Mean: Income & Ease of Obtaining Financial Services Report
income
Ease of Obtaining Mean N Std.
financial Services Deviation
difficult 6340.28 36 5581.843
average 9391.03 39 6537.039
easy 11176.9 13 11675.894
2
Total 8406.82 88 7304.176
Table v
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Correlation (Availability of Land & Ease of Obtaining Financial Services)
Ease of Land perches
Obtaining
financial
Services
Ease of Obtaining Pearson Correlation 1.000 .158
financial Services
Sig. (2-tailed) .141
N 88.000 88
Land perches Pearson Correlation .158 1.000
Sig. (2-tailed) .141
N 88 93.000
Table vi
Correlation (Income & Outstanding Loans)
income loans
**
income Pearson Correlation 1.000 .392
Sig. (2-tailed) .000
N 93.000 90
loans Pearson Correlation .392** 1.000
Sig. (2-tailed) .000
N 90 90.000
**. Correlation is significant at the 0.01 level (2-tailed).
Table vii
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Correlations
savings loans
**
saving Pearson Correlation 1.000 .312
s
Sig. (2-tailed) .003
N 93.000 90
**
loans Pearson Correlation .312 1.000
Sig. (2-tailed) .003
N 90 90.000
Table viii
**. Correlation is significant at the 0.01 level (2-tailed).
Means: Land in Perches and the Ease of Obtaining Financial Services
N Mean Std. Std. Error 95% Confidence Interval Minimum Maximum
Deviation for Mean
Lower Upper
Bound Bound
difficult 3 140.42 188.203 31.367 76.74 204.10 880
6
averag 3 141.79 165.249 26.461 88.23 195.36 640
e 9
easy 1 253.08 260.108 72.141 95.89 410.26 800
3
Total 8 157.67 192.627 20.534 116.86 198.48 880
8
Table ixi
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Mean: Savings & Ease of Obtaining Financial Services
saving
s
N Mean Std. Std. 95% Confidence Interval Minimu Maximu
Deviation Error for Mean m m
Lower Upper
Bound Bound
difficu 3 8784.72 13764.55 2294.09 4127.47 13441.98 50000
lt 6 5 2
averag 3 17689.74 21486.27 3440.55 10724.70 24654.79 75000
e 9 2 7
easy 1 19069.23 27623.58 7661.40 2376.47 35761.99 85000
3 2 3
Total 8 14250.57 20105.95 2143.30 9990.52 18510.61 85000
8 1 2
Table x
Correlation (Savings & Ease of obtaining Financial Services)
savings Ease of
Obtaining
financial
Services
savings Pearson Correlation 1.000 .211*
Sig. (2-tailed) .048
N 93.000 88
Ease of Obtaining Pearson Correlation .211* 1.000
financial Services
Sig. (2-tailed) .048
N 88 88.000
70 | P a g e

*. Correlation is significant at the 0.05 level (2-tailed).
Table xi
Descriptive Statistics: Income
N Range Minimu Maximu Sum Mean
m m
Statistic Statistic Statistic Statistic Statisti Statisti Std.
c c Error
income 93 35000 35000 768300 8261.2 744.192
9
Valid N 93
(listwise)
Std. Variance Skewne Kurtosi
Deviation ss s
Statistic Statistic Statistic Std. Statisti Std.
Error c Error
income 7176.729 5.151E+07 1.528 .250 2.204 .495
Valid N
(listwise)
Table xiii
Income & Race
income
race Mean N Std.
Deviation
Sinhales 9052.6 77 7490.283
e 0
Tamil 3450.0 9 2744.654
71 | P a g e

0
Moor 5742.8 7 4346.591
6
Total 8261.2 93 7176.729
9
Table xiiiii
Land Ownership (Tamil & Moor)
race N Mean Std. Std. Error
Deviation Mean
Land Tam 9 3.33 10.000 3.333
perches il
Mo 7 39.29 88.902 33.602
or
Table xiviii
72 | P a g e