Microfinance in Uganda
March 11th, 2008 at 2:20 pm | posted by Virginia SimmonsSeveral members of ONE’s staff are traveling through Uganda and Rwanda this week. I just received an email from ONE’s Margaret McDonnell who met with beneficiaries of a Kampala, Uganda microfinance program today.
Before her email, a little background on microfinance:
Because it is often difficult to find paying jobs in poor countries, many people earn a living by starting and operating their own small businesses. Examples of these types of businesses could be selling fruits or vegetables at a local market, or providing basic services such as sewing clothing. Often these small businesses can’t access credit or other financial services to grow and develop their business and provide for their family and community.
Microcredit and microfinance programs like these described below are especially important for women, who often don’t have access to financial resources in the way that men do in these countries. U.S. funding for microcredit/microfinance programs in recent years has been approximately $200 million annually.
And now Margaret’s post:
“This afternoon we met with Swabrah Scovia, who works with FINCA, the Foundation of International Community Assistance. She brought us to visit beneficiaries of one of their microfinance programs in the Naguru neighborhood in Kampala, Uganda.
The 12 women shared their stories about how the loans have helped them start or grow their own businesses, ranging from vegetable stalls to second-hand clothing shops. Loans start at the equivalent of 25 dollars and can grow to 5,000 dollars over time and with proven credit. The women have become very close and operate like a team, meeting bi-weekly to share their business plans, meet their financial commitments, and help each other through daily life challenges.
I will never forget the pride on the womens faces when they described being able to provide food for their families and to send their children to school.
- Margaret
March 11th, 2008 at 7:23 pm
Thanks Virginia for posting all these GREAT reports from the ONE staff who are currently in the field in Uganda and (very soon) Rwanda.
This trip is important to familiarize ONE staff & supporters with the obvious truth of millions of Africans’ daily reality of numerous challenges while helping us to see the tremendous reservoir of courage and dignity that people in Africa possess.
Whether it’s street children, many of them AIDS orphans, finding a new way in life through outreach programs or whether it’s microfinance programs to help women lift themselves & their families out of extreme poverty, things in Africa are slowly improving.
Let’s continue to COME TOGETHER AS ONE so that many more people in Africa will have a renewed chance at a safe and successful life.
Take very good care of each other. Blessings are always around.
ALWAYS FOREVER, ONE - debbie
April 25th, 2008 at 11:37 am
what factors limit small scale business enterprises in uganda from accessing microfinance credit?
June 20th, 2008 at 1:06 pm
Dear Collins,
A number of factors limit access to microfinance by small clients in Uganda. Notable among these are lack of collateral security and high transaction costs to access loans. Most MFIs require collateral to access loans which collateral is not available for small business enterprises.
N