Many worker support programmes that are supposed to convey great benefits for employees often in fact do quite the opposite. No wonder, therefore, that schemes designed to offer a road to paradise for hard-pressed workers are often viewed with skepticism by employers and employees alike. However, with the advent of "iCare Benefits" to the Thailand market, there is, at last a truly viable, already internationally tested scheme that really does offer and deliver what it claims.

To explain what "iCare Benefits" already provides for over 3 million workers in 7 countries, now including Thailand, we asked Pawel Gorski, Head of Impact Partnerships (email: pawel.g@icarebenefits.com) and Ms. Kanokpan Chaisuriyaphan, Thailand Operation Director (email: kanokpan.c@icarebenefits.co.th) at iCare Benefits to explain the good news:

What is the history and mission of iCare Benefits?

Starting 4 years ago, the mission of "iCare Benefits" is to provide workers with immediate access to essential products and services. This enables workers and their families to improve quality of life without the burden of onerous interest payments. Based in Singapore, activities now reach 3.1 million workers, with operations and start-ups in Vietnam, Cambodia, Laos, Thailand, Philippines, Indonesia, India, Bangladesh and Brazil.

Key partners include UNICEF, IFC, Adidas, Intel, Levi-Strauss, Marks & Spencer, Merck, Panasonic, Puma, Samsung, Yamaha, and several employers' associations and trade unions.

The company provides employee benefits to workers in factories, who generally work 6 days per week, often 10 to 12 hours per day, earning from the equivalent of Baht 3,000 up to Baht 15,000 per month. Three quarters of the workers are women, having to combine long daily working hours with domestic duties. For these workers, the ability to purchase essential items such as refrigerators, cooking stoves, household furnishings and mobile phones, provides great work incentives and life satisfaction, with the added benefit that "iCare Benefits" involves no onerous financing burdens additional to basic product cost. All its members' repayments are genuinely interest-free.

What is the innovative approach of iCare Benefits?

Access to these essential products and services is provided as a zero-supplementary cost employee benefit solution delivered by agents at the work-place, or through electronic communication services. Workers availing themselves of the service can do so either by paying cash, or by interest-free monthly repayments over a 6 month period at a market-competitive and in some cases discounted price. Unlike other hire-purchase or deferred payment schemes, there are no interest payments, no penalty charges, no front-end or service fees. The scheme is supported by automatic salary withholding or bank auto-debit schemes, depending on the management's requirements in each company.

In order to avoid overburdening workers with indebtedness, borrowings under the scheme are limited to a monthly repayment of 30% of gross monthly salary. Workers are also educated in prudent personal financial management to help them plan their product and service acquisitions, and avoidance of loan-shark borrowing alternatives. The latter may sound good to unsophisticated borrowers, but often lead to individual and family disasters owing to heavy financing burdens.

What are the achieved outcomes of "iCare Benefits"?

According to independent surveys commissioned by "iCare Benefits", over 90% of participants in the "iCare Benefits" scheme expressed the view that their quality of life had improved as a result of participating in the scheme, while 81% felt that they were more satisfied in their work / life balance, and 77% believed that they were more diligent and productive at work.

With over 3.1 million participants, "iCare Benefits" now reach over 5 million family members. These are mostly in the lowest wage-earning levels, at or below Baht 300 per day. The scheme has the ambitious target of doubling participation to over 6 million participants by end 2017, and to continue doubling participation every year thereafter.

The great advantage all round is the liberation of workers from the informal lending sector, and even the format lending sector, where interest rates may reach 30% or more per annum.

In the case of "iCare Benefits" existing members' reliance on the informal sector has fallen from 64% to 14% of members. Furthermore, 68% of members indicated that the scheme enables them to buy items that they could not have considered buying before, all of which provide their families with better living conditions.

How does "iCare Benefits" manage to provide interest-free purchase loans?

Whereas retailers spend heavily on fixed retail space and inventory holding "iCare Benefits" operates just-in-time direct sales and delivery, generating savings that are passed back to its members in the form of interest-free installments.

Products are sourced at best wholesale prices, in some cases benefitting from bulk purchases over time from selected, high quality suppliers who guarantee producer performance and provide servicing where necessary. The products are delivered to buyers at their workplaces or homes, according to their preferences. Organisationally "iCare Benefits" operates as a highly-efficient social enterprise, aiming at reasonable profitability alongside service to the community. As an ethical social enterprise, "iCare Benefits" aims to do good business in support of the community at large.

Who are the committed investors in "iCare Benefits" who share these beliefs in business-oriented community service?

Investors are ever-expanding, along with the growing geographical coverage of "iCare Benefits". At this point, in addition to "iCare Benefits" founders and executives, the main investors include Sumitomo Mitsui Bank (Japan's second largest bank with US$1 trillion assets), Experian Asia Pacific (world leading credit rating and data analytics group), Kusto Tiger Fund (Kazakh asset management group), Unitus Impact (San Francisco-based social impact venture capital group).

Conclusions

The sustainable development goals of "iCare Benefits" include a commitment to promote health and well-being, inclusive quality lifelong education, and gender empowerment and equality. Achievements to date are impressive, but in future "iCare Benefits" promises to become one of the leading forces to achieve higher quality of life for workers and their families. These are still early days, but performance so far indicates a bright, long-term future.

---

Christopher F. Bruton, over 46 years in Thailand, is Executive Director of Dataconsult Ltd, a local consultancy. He can be reached at chris@dataconsult.co.th. Dataconsult's Thailand Regional Forum provides meetings, seminars and extensive documentation to update business on present and future trends in Thailand and in the Mekong Region.