RHLF Impact Assessment: 2010

1. RHLF Impact Assessment: 2010 Results of a face-to-face interview-survey conducted in 9 province of 930 borrowers Survey conducted by: Progressus Research & Development

2. Content • Methodology • Demographic profile of Borrowers • Loan Description • Loan Outcome • Loan Impact • What impacts on Loan Outcome? • The Borrowing Experience • Consumer Education • Challenges in Research • Conclusion

3. Methodology: Sample • Combined Loan book -Total RHLF loan book per Province • Verified “suburbs/villages” (Google Earth) • 3 random points selected per Province • Cluster points -> All towns/ cities/ villages closest to this cluster point were marked. Borrowers listed within these towns/ cities/ villages from all Lenders were included in the sample frame for the Province. • Cluster expanded where necessary to reach target sample size. • Sample frame -> randomised. • A final sample list was prepared of borrowers who are traceable.

4. Methodology: Data Collection • Training of Interviewers, and Supervision of fieldworkers essential • Sampled Borrowers were traced by employing the following means: • Telephone appointments made for an interview. • Home addresses were traced and Borrowers were interviewed immediately where possible, or an appointment made for later • Work addresses were followed to find respondents at work – interview scheduled, as well as appointment made to visit the home after work to obtain the GPS reference point and picture. • Methods used interchangeably (up to 3 visits)

5. Methodology: Sample Result

6. Demographic description of Borrowers

7. Who are the borrowers?Slide 1 of 3: • Gender: 50.5% Male • Average age: 48 years old • High employment rate • Private sector (two thirds) • Government (third) • Income • Individual income: R6,821 • Household Income: R9,111 • Household Size: 5 people • 59% Nuclear families; • 23% Single parent families; • 12.8% Singles/ Singles Sharing • 2% Disabled

8. Who are the borrowers?Slide 2 of 3: • Savings • 47% of Borrowers save actively • 84% Fixed monthly payment; 12% When they can • R625 p/m • 57% use Bank for savings; 24% Stokvel

9. Who are the borrowers?Slide 3 of 3:

10. Loan Description

11. Loan Description • Loan Size: • R7,971 • Requirements: • Mostly ID Book, Payslip, Bank Statements

12. Loan Outcome

13. Loan Outcome

14. Loan Outcome: If Home Improvements...

15. Loan Outcome: If Built (10%)

16. Loan Outcome: If Built... • Built on average 36m² • At a cost of R744 per m² • 12% self built, friends, family (39 days labour) • 44% stock piled materials in preparation of building • 10% build in sections when they had money available • 88% started building after 1 month of getting loan • 58% used additional money (on top of loan) to build • (Mean: R17,605 Median: R7,000 from OWN SAVINGS)

17. What impact did the loan have on Borrowers?

18. Loan IMPACT1: Life is BetterSlide 1 of 7 • Self reported impact: • 91.6% said loan made life better

19. Loan IMPACT 2: Self ESTEEMSlide 2 of 7

20. Loan IMPACT 3: Quality of LifeSlide 3 of 7

21. Loan IMPACT 4: Security of TenureSlide 4 of 7 • Positive impact on Security of Tenure • 20.6% reported INCREASE in sense of security – (A sense that you will NOT easily loose your home)

22. Loan IMPACT 5: EducationSlide 5 of 7

23. Loan impact 6: Repeat LoansSlide 6 of 7 • Repeat Loans: • 24% took more than 1 loan from Lender • Intention to take Repeat Loans: • 82% intend to use Lender again

24. Loan Impact 7: Financially Inclusive for low income groupsSlide 7 of 7

25. What impacts on Loan Outcome?

26. What impacts on Loan Outcome? • Gender • Home Improvements more likely if Female (57%) than when Male (37%) • Income • Home Improvements more likely if smaller income • <R3,500 (I: 69% HH: 69%) • R3,500 to R7,500 (I: 39% HH:45%) • >R,7,500 (I: 39% HH 39%) • Tenure: Home Improvements more likely if: • OWN (47%/ 37%) • Tribal Land (89%) than: • RENT (11.2%)

27. The Borrowing Experience

28. The Borrowing Experience: Finding out about the LenderSlide 1 of 3

29. The Borrowing ExperienceReason for using this lenderSlide 2 of 3

30. The Borrowing Experience:Overall procedureSlide 3 of 3 • 92% - Easy to obtain loan • Mostly helped by Lender to apply • 89% will recommend Lender

31. Consumer Education

32. Consumer Education • 56% received consumer education (mostly from Lending Institution) • 86% received Loan Agreement • 85% received explanation on Loan Agreement • 78% had opportunity to ask questions prior to signing it

33. Consumer Education

34. Challenges in the Research • Inaccurate contact details for Borrowers: • Provinces being recorded incorrectly on the address lists provided by Lenders • Contact address not where investment was made • Contact address not where borrower lives most of the time • Borrower suspicion about the nature of the interview • Family unaware of borrower’s loan – borrower wants to keep it a secret • Time and money spent on home visits, while loan was not used for housing • More support needed from Lenders – borrowers phoning the Lender and not get confirmation that the research is legitimate

35. Conclusions • Impact Measurement challenging • Borrowing Experience positive • HOUSING Loan Outcome can be improved • Gender, Income, Tenure impacts on Loan Outcome • Loan Impact: • Overall made life better • Self worth • Quality of Life • Education • Security of Tenure • Impact on poor (<R3,500) • Repeat Business

36. Regular Portfolio Impact Reporting (M Maila)