Financial Inclusion and Resilience: How BRAC’s Microfinance Program Recovered from the West Africa Ebola Crisis

In July 2014, at the height of the Ebola virus disease outbreak, BRAC’s microfinance institutions (MFIs) in Liberia and Sierra Leone were confronted with two competing scenarios of how to move forward. Path one: revise operations in a challenging, volatile situation and press on, despite the threat to staff and clients’ health. Path two: pause operations, establish protocols to protect staff, clients and relationships, but risk long-term recovery and customer retention.

After weeks of adjusting its operations, including closing branches in the worst-hit areas, BRAC leadership ultimately decided to suspend microfinance operations in August 2014. While other local MFIs continued operating, BRAC’s MFIs closed for seven months, reopening in March 2015, when the number of new Ebola cases were declining. BRAC leadership expected that the long pause in operations, coupled with the severe economic downturn, would cause clients to default on their loans. BRAC was prepared to write off at least half of its portfolio in both countries. Remarkably, within the first few weeks of restarting collections, the repayment rates stood at well over 90% in Liberia and nearly 70% in Sierra Leone.

This case study traces the effect of the Ebola crisis on the operations of BRAC’s MFIs. It examines the MFIs’ reaction to the crisis, and the repercussions of the suspension on operational viability, revealing lessons on how to build institutional resilience, that apply both to BRAC and the broader microfinance community. The case study also examines the resilience of clients themselves measured by their ability to repay loans after collections restarted, with the hopes of gaining a deeper perspective into their strategies for coping during and after the crisis.