Wednesday, August 21, 2013

Celebrating KIVA!

Microfinance is a general term to describe financial services to low-income individuals or to those who do not have access to typical banking services. Microfinance is based on the idea that low-income individuals are often capable of lifting themselves out of poverty if given access to financial services.

Over the past three or four years through KIVA we have made monthly loans of $25.00 to individuals in many different part of the world. Most have been women, many have been groups of women, who work together to guarantee each other's loans.

KIVA combines our $25.00 with loans from other lenders to make up the full amount of the loan. Borrowers pay back a small amount on their loan each month,   so your money is recycled. When a loan is repaid you can choose to loan the funds to another borrower, or take the money out of the program and put it back in your pocket. Although we have only put $286 into the program in all the time we've participated, by recycling what has returned we have loaned $1,350. And of the 49 loans we have made, only one borrower has not paid back the loan in full, and her entire village was destroyed in a tsunami. We do not know if she escaped and survived or if she died.

This month we celebrate making loans number 50 and 51, both to communal groups in Bolivia served by Pro Mujer (For Woman).  Pro Mujer provides not only loans but also free basic health care to borrowers and their children, in addition to business and financial literacy training.

Loan number 50 went to “LAS MAÑANERAS” (The Morning) group, which is starting its fifth loan cycle in Pro Mujer. It is governed by a board of directors, and Pascuala is the president. The members' businesses are varied and include: condiments sales, potato sales, canned food sales, grain sales, pop sales, vegetable sales, and food sales.

This loan will benefit all these small businesses. The leader of the group, Pascuala, says that she has been part of Pro Mujer for five loan cycles. She joined at the invitation of a promoter who visited her at home to tell her about Pro Mujer's loan program. She currently has a business selling vegetables. She says that she began selling vegetables several years ago when she saw what a wide demand there was for fresh vegetables.

This loan is to increase her working capital so she can purchase larger quantities of vegetables from wholesale markets of the city of El Alto. She will then sell the produce in her market stall. This work allows her to generate an income in order to maintain her household; she is married and has three children. When asked what she likes about Pro Mujer, she responded that she likes the health center.

Members of Villa Esther

Loan 51 went to the communal group "Villa Esther" which is starting its second term in Pro Mujer. The group has eight members and is run by a Board of Directors headed by Constancia, the president. The members have a wide variety of businesses, including a bakery, a cleaning service, bread sales, clothing sales, and the weaving of wool sweaters.

The loan will benefit the tiny businesses of the organization where Constance is a member. She said that they joined Pro Mujer a year ago at the invitation of her sister-in-law, who is a member of another communal group of borrowers.

Constance runs a bakery, which helps to sustain her family. She learned how to run this business with the help of a family member who gave her the start-up capital. Her loan will be used to purchase flour, which she will buy from one of the wholesaler vendors in the city of El Alto. After using the flour for baking, she will sell her products in her market stall. Her work generates income which she uses to help maintain her home and family, as she is married and has four children. When asked what she liked most about Pro Mujer, she said that she liked the access to health assistance.

Anyone can make a KIVA loan, in fact you can make a free one now by following this link. Select a borrower, make the loan free of charge and see how it works. You get updates which tell you how your borrowers are doing, and you can see how your loan has helped raise them help themselves.

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