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Disaster Management Measures of Microfinance Institutions in Sri Lanka

Author:

PJS Fernando

University of Sri Jayewardenepura, LK
About PJS
Lecturer in Business Economics, University of Sri Jayewardenepura, Sri Lanka. Currently Doctoral student at the Graduate School of International Development, Nagoya University, Japan
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Abstract

The paper analyzes the effectiveness of current disaster management practices of Microfinance Institutions (MFIs) in Kalutara District, Sri Lanka, with special reference to the 2008 flood. It also seeks to find possible links between disaster management and microfinance at different stages of disaster management cycle. To meet the objectives of the study, a field survey was conducted in three Divisional Secretarial divisions, namely Bulathsinhala, Dodangoda and Palindanuwara, which are the most severely affected divisions of the District. The literature review found that direct and indirect disaster management measures of MFIs enhance the resilient of its members against disasters. The survey findings revealed that MFIs in the Kalutara District scrutinize direct disaster management tools to enhance the capacity of its members against disasters. Moreover, the regression analyses confirmed that the probability of being recovered is higher for microfinance member than non-members. Therefore, we conclude that microfinance play an effective role in disaster management. Nonetheless, the current disaster management measures of MFIs in the Kalutara district have largely focused on post disaster management strategies such as disaster recovery loans. In our opinion, risk management (pre-disaster) is more effective than crisis management (post-disaster) in any disaster management program. Therefore, it is recommended to implement risk management strategies such as micro insurance, disaster awareness programs and disaster mitigation loans to get more effective outcomes of the disaster management initiatives of MFIs.

Sri Lanka Journal of Advanced Social Studies, Vol 2:No. 2, July – December 2012; Page 91-120

DOI: http://dx.doi.org/10.4038/sljass.v2i2.6209

How to Cite: Fernando, P., (2013). Disaster Management Measures of Microfinance Institutions in Sri Lanka. Sri Lanka Journal of Advanced Social Studies. 2(2), pp.91–120. DOI: http://doi.org/10.4038/sljass.v2i2.6209
Published on 03 Nov 2013.
Peer Reviewed

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