SuSanA - Forum Kunena Site Syndication Wed, 16 Apr 2014 13:37:37 +0000 Kunena 1.6 SuSanA - Forum en-gb Re: washcost calculator - by: dietvorst
You can already start using the tool at

For more information read Do the Math, Make it Last]]>
WG 2 (finance, economics) Fri, 21 Mar 2014 11:06:49 +0000
Re: Tools for estimating costs to improve municipal sanitation services and environmental infrastructure - by: sjoerdkerstens Since 2006 our company Royal HaskoningDHV and its partners (including IRC) have been working on an approach to plan sanitation in Indonesia. Currently this is done in the USDP (Urban Sanitation Development Program) project. At this point there are 420 cities and regencies (out of 500 in the whole of Indonesia) joining the program. After (1) an advocacy phase (done by our health cell) and (2) the setting up of a local sanitation workgroup (POKJA) done by our institutional cell), phase (3) deals with the mapping of the current sanitation situation ("white book") and formulation of the City Sanitation Strategy. Finally a detailed plan is formulated in the Program memorandum (phase 4) after which E&M is started (phase 5). For the phase 3 and 4 we have recently developed a new (xls) based tools that allow cities to do their own planning for a 20 year period for the three sub sectors wastewater, solid waste and drainage.
The first tool (which results in the white book) requires filling in a data base, with values on population, expected development of population and urbanization, land use, Environmental Health Risk Assessment (EHRA), poverty data, access data to improved sanitation and prevalence of open defecaction, solid waste collection data and current drainage problems. In this first tool, the two main outcomes are (1) priority setting and (2) zoning of areas within a city that have the same features.
The output of the this first tool is the input for the development plan for the three sub-sectors. Based on the existing situation and expected population growth and target of sanitaion for the mid term (5 years) and long term (20 years), the "gap" is calculated. based on the city's features the most feasible system is selected (for wastewater we differentiate between on-site systems, community based systems, medium centralised systems and off-site (centralised systems). Typical costs figures are used, as well as required planning documents requirements (feasibility study, Design, env Impact Asess etc) as well the typical time frame). These xls tools use the same approach as developed snice 2006, but facilitate the processing and calculations. Tools were developed since 2012 and have now been implemented/tested in a dozen cities. This year another 9 cities will be using this tool and 50 next year.

Should you have any further question, please don't hesitate to drop me a note!
best regards,
Sjoerd Kerstens]]>
WG 2 (finance, economics) Mon, 17 Mar 2014 01:31:08 +0000
Re: Tools for estimating costs to improve municipal sanitation services and environmental infrastructure - by: sphpan
Maybe someone's already mentioned it, but have you checked out the IRC WASHCost calculator: It's still in beta version, but it has a pretty user friendly interface, and is freely accessible online.

WG 2 (finance, economics) Sun, 16 Mar 2014 21:39:56 +0000
Tools for estimating costs to improve municipal sanitation services and environmental infrastructure - by: jonpar
This posting is equally relevant to both WG2 Finance and Economics and Working group 6 Cities and planning.

I am interested to learn about what tools have been developed to support decision-making processes in relation to budget estimates to improve municipal sanitation services and environmental infrastructure.

For example, it would be good to hear from CEPT about the application of the PIP model - see

Also, there is the model developed by Partners in Development mentioned in Annex F of the comprehensive report on “TACKLING THE CHALLENGES OF FULL PITS Volume 1: Understanding sludge accumulation in VIPs and strategies for emptying full pits”. Water Research Commission July 2012 which refers to a “financial model created in Excel used to estimate the costs of running a pit latrine emptying operation.

I am sure there are other tools that have been developed and it would be good to hear more about what these are and where they have been applied. In addition, whether they are available as open source software for others to access and utilize?

best regards,

WG 2 (finance, economics) Sat, 15 Mar 2014 12:57:36 +0000
Sector wide investment and financing tool (SWIFT) - by: jonpar see


The tool has been developed as a generic representation of a water sector and is designed to assist African countries to develop simple financial plans for their water sector. The primary function of a SWIFT analysis then is to understand the financial balances in the water sector of a given country and to allow strategic analysis of options available to close those gaps.

Can anyone share their experience of using SWIFT

WG 2 (finance, economics) Tue, 11 Mar 2014 21:05:17 +0000
Re: Effectiveness of the Microcredits in Sanitation - by: F H Mughal
This has different aspect, in that, it is aimed to learn from the experience of other members, whether microfinance caused problems in sanitation sector.

Thank you,

F H Mughal]]>
WG 2 (finance, economics) Sun, 02 Mar 2014 11:59:03 +0000
Re: Effectiveness of the Microcredits in Sanitation - by: christoph I am sure you remember that we had a discussion about microfinance lately in this forum.
I did not get the point why discussing it again on another thread, as you took part in the discussion and as you are a very clear sistematic thinker for in my perspective, I thought I may have missed an additional aspect.
Could you explain?
Thank you.
WG 2 (finance, economics) Sun, 02 Mar 2014 11:53:33 +0000
Re: Effectiveness of the Microcredits in Sanitation - by: JKMakowka
In general the debate is around "consumptive" vs. "productive" loans, where sanitation is clearly a consumptive one and thus usually not considered a good choice by MFIs.

Personally I also think that there needs to be a debate around "dedicated" MFIs, i.e. those banking only institutions that have been build up with donor funds and do nothing but microfinance. I think this leads to unnecessarily high overhead costs and profit "optimizations" that ultimately counteract the very idea of MFIs (and let them appear not much different than the exploitative money lenders they were seeking to replace originally).
If microfinance is coupled to a real business though, lets say an agricultural input and produce trader, it can be done with much lower overhead costs and partially even at a loss if the company deems it to be beneficial in the medium to long term (and if it can be offset by other profits).

The same logic can apply to microfinance in sanitation. The entrepreneur who builds the toilet can much more efficiently offer a loan for it and later collect the payments together with regular service charges. I think this should work especially well with UDDTs as they need to be emptied more regularly.

An good idea to start this could be (government) subsidized loan insurances though, which would make it easier for such entrepreneurs to calculate the risks involved and which could be used for a "pro poor" approach permanently.]]>
WG 2 (finance, economics) Sun, 02 Mar 2014 10:10:02 +0000
Effectiveness of the Microcredits in Sanitation - by: F H Mughal
While Doug’s discussion is in the context of sustainable agriculture, it is a fact there is significant growth of microfinance institutions. This is also valid for Pakistan. However, microfinance in sanitation sector has not picked up the pace, as yet, in the Sindh province of Pakistan, primarily due to low priority for sanitation.

Here is the interesting part of Doug’s write-up. He says that after an initial burst of wild enthusiasm, there is now a growing debate about the effectiveness of these credit mechanisms as tool for ending poverty. This is especially true where the focus on scalability has caused lending institutions to neglect impoverished rural populations. The farmers who can take out loans sometimes borrow for costly agricultural inputs and then become trapped in a vicious cycle of crop failure and debt. Particularly troubling are the reports of up to 200,000 farmer suicides in India, where farmers have borrowed to buy expensive genetically modified organisms, chemical fertilizers, and pesticides.

Reading this makes me to think twice about microfinance in sanitation field, as those problems mentioned above, could put progress in sanitation in the rural areas in reverse gear. While taking microfinance system to a next higher level, where greed for more money crops in, may cause problems, I would appreciate, if forum members can share their experience of situations where microfinance in sanitation has brought in more problems and, whether the effectiveness of microfinance in sanitation sector is doubtful.

F H Mughal]]>
WG 2 (finance, economics) Sun, 02 Mar 2014 06:01:41 +0000
Re: Microfinance for Sanitation - by: AquaVerde
Thanks for your clarification about your system. How about having a special "Toilet Revolving Fund" by external support/founders managed by a bank to start the financing process and to keep a toilet/sanitation installation/improvement scheme running? This external funds (WB, EUCOM-Aid and so on) have to cover up by "refilling" for the "usual" "losses" like bank fees and some usual non repayments.

Is this "Revolving Fund" suggestion practical in comparison to ongoing "usual" large governmental top to down installation schemes for piped sanitation systems and rural VIPs financed by WB, EUCOM-Aid and so on?

WG 2 (finance, economics) Thu, 02 Jan 2014 11:46:13 +0000
Re: Microfinance for Sanitation - by: JKMakowka
So what it basically boils down to is that MFIs prefer to give loans for other objectives (probably productive instead of consumptive) and need to be incentivised by the toilet producers to offer credit for this purpose?

Seems like a viable strategy in the short term to reach your goals of increased latrine coverage, but I doubt this kind of market distortion (which ultimately the poor customers pay for) is something beneficial in the long term.

I think for these consumptive loans it is better to cut out the MFI (or commercial bank) middle-man all together and let the producers deal with offering rate payments by themselves (but an insurance for small producers against large-scale defaulting of customers could be beneficial).]]>
WG 2 (finance, economics) Thu, 02 Jan 2014 11:33:37 +0000
Re: Microfinance for Sanitation - by: ggrevell
Thanks Detlef for highlighting that post.


Krischan and Cristoph are correct: the monthly payments indicated in step #5 include interest (though it wasn't our intention to deliberately omit that information). Thanks for requesting clarification.

The interest rate offered is 2.75% per month with declining balance - equivalent to 33% on an annual basis. The collection of the fee described in the blog entry does not lead to a lower interest rate for the consumer --> the rate is the same as for other 'non-business' loans, which are available between USD 20 and USD 10,000 for 3-30 months.

I can understand Krischan's suggestion that the fee is meant to make interest rates appear lower, but in reality there is not a choice available to consumers between the current interest and a higher one. In our experience, MFIs do not want to offer loans with higher interest rates in order to offset the higher cost/risk profile of these types of loans. Perhaps they believe that consumers (or other stakeholders) are very sensitive to headline interest rates. So instead we see the status quo: MFIs doing little-to-no proactive promotion of loans for toilets.

I agree that suppliers will ultimately pass on all costs to consumers (leaving aside cross-subsidization between products). But I think comparison with credit cards is noteworthy. Merchants build the cost of credit-card financing into prices because consumers place a value on it. On small ticket items, consumers who pay 100% upfront with cash rarely demand a discount. Unfortunately, or fortunately (depending on your perspective) upfront (cash) payers are thereby subsidizing the financing cost of borrowers. If we assume that those with cash available are not the poorest, perhaps this cross-subsidy feature has an equity advantage...

One thing WaterSHED has seen clearly is that more and more households are purchasing latrines with credit when it's proactively promoted as an option. Several MFIs we've worked with will not participate proactively unless they earn an additional fee. Latrine suppliers (and indirectly, consumers) are willing to pay such fees. And the scheme does not require unsustainable donor funds to continue working.

We'll be happy to keep updating the forum on the progress as we collect more data and experience over time.

Best regards,

WG 2 (finance, economics) Thu, 02 Jan 2014 10:48:21 +0000
Re: Microfinance for Sanitation - by: smecca WG 2 (finance, economics) Wed, 01 Jan 2014 23:02:58 +0000 Re: Microfinance for Sanitation - by: Marijn Zandee
In these somewhat lost days between Christmas and New Year.

Why do we not try to reverse the microcredit logic? And try a "toilet savings scheme", deposit X amount per month and after 24 months you can have your toilet build. In order to make the idea attractive we may have to look at somewhat old marketing materials from banks out of the times that they still encouraged people to save instead of to have maximum lines of credit. This way interest rates would actually help people instead of making the toilet more expensive (interest given should cover inflation + a small bonus).

One obvious challenge is that these sort of financial institutions would have to somehow invest the deposited money to be able to cover interest, otherwise it will just end up being a ponzi-scheme.

Kind regards

WG 2 (finance, economics) Tue, 31 Dec 2013 05:18:12 +0000
Re: Publication on Scaling Rural Sanitation in India - Apart from customer financing, MFIs (micro-finance institutions) can act as enablers - by: JKMakowka WG 2 (finance, economics) Mon, 30 Dec 2013 07:35:37 +0000