Program Features
WMI is currently providing small loans to women in the Buyobo, Uganda area in eastern Uganda, about 150 miles east of Kampala and 10 miles from the frontier town of Mbale. The Buyobo area was selected as the first community for WMI microloans in order to build on existing relationships WMI board members had with the community through other non-profit activities. Many of the residents of the villages in the area are AIDS widows, who in turn care for dozens of young children orphaned by the disease. To help each other, the women formed the Bulambuli Widow's Association and they manage to survive through entrepreneurial ingenuity and mutual support. WMI works through the Widows Association to offer credit assistance. The loan program has spread from the Buyobo cub-county to 3 other sub-counties in the Sironko District: Butandiga, Kama Border and Buwalasi - over 50 villages are served. Buyobo is a very densely populated rural area. The large population allows for numerous business opportunities, including: running small general shops, growing and selling vegetables, buying, bundling and reselling bogoyas, raising chickens, tailoring, making and selling meals, buying and selling second-hand clothes, growing coffee, dealing in grains and beans, grinding maize, carpentry and hair salons, selling fuel efficient stoves. The community is very collaborative and this cohesiveness helps ensure that loan repayments are made on time. When WMI extended its loan program from Buyobo to the neighboring sub-county of Butandiga, it entered an area with a very high percentage of AIDS orphans. All the woman in the Butandiga group house several orphans. Most of the borrowers live in semi permanent houses (long grass roof, mud walls and mud floors) and typically have children sick with malaria every month. Their businesses include: second-hand clothing bought from Mbale and sold in the local trade centers, sugarcane, coffee, firewood, retail shops, and selling fish. The town suffers raids from the people of neighboring Karamojong, who steal cows and cars. The village met our van at the roadside and when the loans were issued, their gratitude was overwhelming. The Kama Border borrowers who were added in July 2009 focus on raising cows and selling dairy products. Many of the women had received a calf from the Heifer Project and are now trying to find ways to increase their animal’s output. Loan Features
- Loan amounts of $50 - $150
Program Focus
The WMI credit program is geared to meet the needs of rural women living in extreme poverty, measured by the World Bank standard of less than $1.25 per day. Many microfinance ventures gravitate to more profitable urban markets, which feature easy access and customers with prior business experience. However, the greatest need for credit is for women in poorer, rural areas, where moneylenders are the only source of capital, and the lack of alternatives makes the population vulnerable to credit abuse. None of the women in the Buyobo area have used any other providers of micro-credit because the alternatives are too expensive. They require a cash deposit and collateral, the paperwork is intimidating, and travel to Mbale is costly and time consuming. The WMI program operates in the villages to eliminate the logistical problems that discourage so many women from applying for credit. Instead of conventional collateral, the WMI program uses mutual guarantees so that women can pledge their word of honor to guarantee their loams. Business Training
WMI works with each borrower to prepare a business plan. Even though the enterprises are very small, the plan provides a basic roadmap for the borrower to reach her economic goal. Simple marketing, business operations and management concepts are taught and the training includes group activities that allow the women to practice techniques for promoting their businesses. Book keeping is emphasized and the lesson on "income minus expenses equals profits" usually draws applause. Although many women living in developing countries have operated some type of micro-business to scrape together income for their families, very few have ever heard about the benefits of record keeping. WMI provides notebooks, pencils and calculators to enable the women to keep track of their business finances. WMI maintains close contact with its borrowers through 4 Local Coordinators who visit all of the borrowers on a rotating basis. The Local Coordinators provide weekly reports of borrowers’ progress in the loan program and assists them with book keeping and solving business problems. By developing sound financial habits and a track record of successful loan repayment, WMI's borrowers can graduate to dealing with traditional financial institutions that offer an array of banking services that can help stabilize the consumption curve of the poor, such as: savings accounts, personal credit, school fee loans, pension plans and insurance. In its role as social entrepreneur, WMI is investing in human capacity building to promote sustainable economic empowerment. |
