MicrofinanceThere is a staggering statistic on a Tanzanian government website: “In Tanzania about 60 percent of women in live in absolute poverty...”. And many of them have small children they are caring for too.

Absolute poverty is a term describing a situation where not even basic needs (such as food, water, sanitation) are being met, and people are living on less than $1 a day.

There are many different models around the world for microfinance programmes, but in a nutshell it is small loans (up to £200 in the case of SWTz) to help single women with children, who are living in impoverished situations, to start small businesses. It is aimed at those women who are not able to receive loans through other sources such as a bank because, for example, they have no credit rating and no assets. THEY have to come up with the business idea, and they have to prove to us they will be responsible for the business and make repayments according to their personal repayment plan.

An example of a woman we have worked with recently is Stella, who lives with her disabled son Collins and her teenage son Gifti. Stella had been making a minimal living by selling local-brew alcohol and beer but wanted to open a larger shop selling food and household items and stop selling alcohol.

In October 2012 we gave Stella a loan. We organized for Stella to spend a day with a Tanzanian friend who runs a wholesale shop. She taught Stella how to budget and manage her stock. Stella bought lots of stock for her shop such as sugar, flour, tea, matches, oil, soap…all the basic things needed on a daily basis in most houses. And she opened shop…and within a few days she was buying more stock and different items such as peanuts (often eaten for breakfast here). And she has been doing well ever since.

Stella is a changed woman. Before she got the loan, we would go to visit her and she would often cry when talking about her situation. These days she is full of joy and hope and laughs non-stop, and her sons are also much happier – they are getting better nutrition and life is a little more comfortable for them these days.

We have many things to learn and to establish with our programme, like providing good basic financial training before giving a loan, establishing a support system for the women, and having a better follow-up process.

We don’t envisage this becoming a major SWTz programme – there are other organisations already successfully doing the same thing here and we don’t believe in reinventing the wheel, but if we can help even a few people like Stella, women who are determined to help themselves, then we can be a part of changing that terrible statistic.

 

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