Microloans for Small Businesses
The microfinace programme is operated in conjunction with the Gondar Town Small and Microenterprise Office. Applicants submit a business idea stating the aim of their business and the reason it will be successful. Based upon these statements, applicants are selected for a five day training course given jointly with the Gondar Town Small and Microenterprise Office . At the end of the course, they are given an examination and those that pass are offered help to compile a business plan; and subsequently they receive a loan. Meketa assists with start-up and provides ongoing support.
To start the programme, 22 people were given a loan to help them start a business. 80% of the original capital has now been paid back allowing us to recycle the money and provide loans to more applicants.
Nine beneficiaries who paid back their loan chose to take out a new one to expand their business. All increased their loan to 10,000 Bir (£330) the second time. There were also eighteen beneficiaries that took loans of 5,000 Bir (£165). We were delighted to hear how their lives had improved. Genet, who sells shoes in the market told us 'since I have my business we are eating 3 meals a day and I can pay the rent every month'. Ferede, who buys vegetables in nearby villages to sell in Gondar said 'I have saved money from my business each month and I will use it to pay for driving lessons so I can find a job as a driver'. Comparing the repeat borrowers to before they started the programme, beneficiaries' poverty rate has fallen, and their household food intake has increased. Across all our microloan borrowers, 85% were paying back on time as of June, although since then the political unrest in Gondar has caused economic hardship, meaning a temporary fall in repayments.
More stories of our loan recipients are told below.
The Participants during the five day training course.
This lady sells butter that women use to treat their hair. The butter is purchased in 20KG quantities. She packages it up for sale each day. She also sells milk, which she buys from a farmer and delivers to people's homes. She is the sole support of her two sons aged 14 and 10. The older son shines shoes in his spare time to help his mother and brother.
This young lady opened a cafe with her loan and purchased a container, and the government supplied the land at no cost. She sells tea, bread, chilli powder and powdered shiro. Her household consists of her two children, her mother and brothers, all in a one room house close to the synagogue. Her mother makes enjera to sell from this home. Her brothers are day labourers.
This market trader is married with four children. The family live in a one room house. He sells potatoes, garlic, chickpeas eggs and onions in the market. Because he sells larger potatoes than his competitors, he is more successful. After paying back his first loan, he has just received another loan to get a license from the government to open a shop.
This lady buys butter from a farmer in a village very far from town, because the farmer feeds his cows with grass so their milk (and her butter) tastes better. She makes her own recipe of butter, containing a unique mix of spices. She supports one son who is 9 years old.