Our partners work in the eastern corridor of South Africa in poor communities along the Mozambique/Eswatini (Swaziland) and Zimbabwean borders. They create micro-enterprise and self-employment opportunities for poor women through basic business training combined with micro-loans for start-up and working capital, plus an ongoing support network to ensure success. Loans are repaid with low interest fees and these funds are re-used to help the next person or fund a second loan. The project plans to disburse loans to 2,013 new clients in four branches over a 3-year period.
What we like about it:
The creation of local micro-enterprise initiatives is a business tool that promotes fair trade, income provision and economic empowerment. The in-country implementing partners have established strong relationships on the ground within communities that Entrust has seen in action. Group rather than individual loans develop a support network for beginning businesses and improves the rate of return. Economic empowerment is a proven tool in community development that supports not only the individual but those in her community and family. We like that many of the recipients can apply for further loans to help build their businesses once the initial loan is re-paid. We love that our partners are now 77% self-sustaining and this continues to grow.
Budget: $22,400 for Year 2 of a 3-year project (start date 1 May). This is the second year of the project, which totals $78,000. The budget covers adequate selection, training, follow-up and management of the loans. The average cost to facilitate a loan is $35 per person.
Without the chance to ‘get ahead’ financially, people are trapped in a hand-to-mouth existence or systemic poverty. Because of this, they have two options: risk great debt and harm to their family by borrowing money from loan sharks or stay poor. Something as simple as good training, strong selection procedures and implementing methodology combined with a micro-loan enables sustainable business opportunities, builds dignity and hope and breaks dependence on aid and handouts.