Microfinance

The highlight of the week - social enterprise Sri Lanka-style!

Shadowed microfinance team on a visit to a local village on Thurs. They met around 45 women in the space of two hours, in the local temple. Each women ran her own microbusiness, or was there on behalf of her husband (mostly it was the former). They each got about 3 minutes with the microfinance staff to talk through their business, how much money they wanted to borrow and how they would repay it. Most of them were approved in principle so now they have to go and fill their forms in etc. They should have the money within 3 weeks.

So far, the project has loaned to 609 people with a default rate of almost zero. They lend between 5,000 and 25,000 rupees (about 20 - 100 quid), with repayments over 20 months at a lower-than-bank interest rate. Most of the women had monthly gross profit of between 2,000 and 10,000 rupees - 10,000 is a good salary here (about 50 quid).

We followed up the assessment bit with a visit to one of their existing clients, a women in her sixties who set up her own spice packet business three years ago. She's now branching out into soya products and now has 6 staff. She's used her loan to buy equipment and materials to help grow the business and was passionate about how it's helped her to develop a better business without being dependent on aid.

As one of the staff said, it's "business with a good heart" (best definition of social enterprise I've heard for a while)