Alliance Foundation Supports the Village Bank Program
Microfinance is the practice of extending small, uncollateralized loans and other support to low-income people, primarily women, to help them start of expand a business. This program targets the most vulnerable among the female population - women in poverty who live on less than $2 per day. Collateral is difficult to obtain for a population largely denied property rights. Therefore, most of these women have found traditional lending sources to be unavailable. In place of collateral, microfinance organizations use a "peer lending" model, providing loans to small groups of women who are jointly liable for these loans. This means that until each member of the group has repaid her loan, no other member of the group can get another loan. Such micro-entrepreneurs repay their loans with interest, further leveraging the investment in creasing loan pools.
Historically, women have used these tiny business loans to lift their families out of poverty in less than three years. The families experience lower fertility and infant mortality rates, improved health and nutrition, higher immunization, fewer incidents of domestic violence, enhanced self-esteem, and greater involvement in community affairs.
Alliance Foundation Helps 15 Women in Guatemala
Our most recent Village Bank in Guatemala helped fund microloans for 15 women in two Village Banks – Artesanas San Pablo and Panajachelense located in Solola, Guatemala. With an average age of 31-1/2, the women who received Alliance Foundation funded microloans are using the funds (average of $250 each) to expand their businesses, which range from selling jewelry to operating small storefronts to making and selling handicrafts.
One of the clients located in the San Pablo La Laguna area is thrilled to have the opportunity to expand her handicraft production as tourism in nearby villages, where she sells her merchandise, is on the rise. “Thanks to this organization for thinking about poor people,” said Marcela Ixcaya Culum de Ujpan. “San Pablo is a bit isolated from the rest of the town around the lake, but that didn’t matter.”
A borrower at one of Alliance Foundation’s Mexico Village Banks in partnership with ACCEDDE: Citizen Auction for Education, Democracy and Development near Guadalajara Mexico.
She is using her loan to purchase supplies to make and sell tamales.
This borrower is from our bank in India in partnership with SKS Microfinance (SKS). SKS was launched in 1998 and currently has 325 microfinance branches in India. To date SKS has provided over $205 million in loans to over 700,000 women in India’s poorest regions.
The Alliance Foundation Village Bank is located in the Village of Etkyala in the Medak District of Andhra Praclesh. She used her loan to purchase the goat in the photo.
This woman is from our Philippines Village Bank in partnership with the Center for Agriculture and Rural Development (CARD). CARD was created in 1998 to establish a bank to serve and to be owned and managed by landless rural women in the Philippines. She is using her Village Bank loan to help her with her sari-sari store (grocery store).