By Jeremy Resmer | Senior Director of Projects“There is freedom waiting for you, On the breezes of the sky, And you ask "What if I fall?" Oh but my darling, What if you fly?” ― Erin Hanson
Over the last twelve months, we’ve witnessed a major shift in the families of our Ethiopia Home Based Care Program.
Since we trained our church partners on starting and facilitating self-managed savings groups, we have seen over 150 people, mostly single mothers, begin saving for the first time in their lives. While it’s critical that they now have a safety net and funds available in case of an emergency or unexpected life event, something even more important is happening.
These women are realizing their own potential and transforming the way they think and speak about themselves.
Dignity. Value. Confidence.
Where there was hopelessness, today there is hope.
These women meet together over traditional Ethiopian coffee to share about life: family, faith, business, joys, sorrows, successes, struggles, fears.
Not only do these women save together and grow in their understanding of basic principles of financial stewardship, but they also encourage one another in every other aspect of life. It’s true that iron sharpens iron. The entire group is better off together.
As we continue to learn from the families that we serve, we gain new insight into their daily lives. Emotional, physical, spiritual, social, and financial health are closely connected. We realize that economic opportunities, like the ability to start or grow a small business, can strengthen families and dramatically improve the quality of life.
Working with our local church partners, we’ve developed other empowerment initiatives, including literacy and microloan programs for the women in the savings groups. The goal is to empower the church with effective platforms, training, and ongoing support. This will enable churches to provide vulnerable families with opportunities to use their creativity and resourcefulness to generate sustainable incomes, while also enabling them to contribute to their communities.
Our microloan program will begin this year and be available to the caregivers in the savings program. Using the knowledge and relationships they have developed in the savings group, members are encouraged to apply for a small loan of 500 Ethiopian Birr to start or expand a business. The loan will be paid back over 10 months at 50 Birr per month with zero interest. At the end of 10 months, each client that successfully pays back her loan will have the opportunity to reapply for another loan up to 1,000 Birr. The second loan will be paid back over 20 months at 50 Birr per month.
The loan program is entrenched in relationships and will include ongoing training, encouragement, and accountability with our clients. The plan is to start small and stay small. Our desire is to make a significant impact in a few communities. We are going into this with eyes wide open, aware of the inherent risks and challenges such a program presents.
The fact is, some clients will struggle for one reason or another and not pay back their loans. It’s a fact we must face. However–more importantly–many more will be empowered to hope, to grow their businesses, and to sustain and strengthen their families.
If you talk to many microfinance organizations working in developing countries, they will tell you that you can’t loan money to the poorest of the poor successfully. I’m not talking about the top 10% of the economically poor, but the bottom 10%–those with no income, assets, or security of any kind. But if no one is willing to invest in these people, they will remain in hopeless desperation.
Microfinance isn’t a silver bullet to alleviate poverty; however, when incorporated into a long-term wholistic program of economic empowerment, it can be a very effective tool.
We know the mountain is tall but we came here to climb.