2009 Micro-Credit Community Banking
"Community Banking" is a system of making micro-credit loans to start small businesses, and it's the most effective way Omega Foundation has found to lift African widows out of their extreme poverty. 70% of the women in Rwanda are widows due to the genocide and on-going hostilities in that area. Women in other areas of the "Great Lakes" region of Central Africa are in similar situations.
A micro-credit bank consists of about thirty women who each receive a loan of $100 to start their own small business. They pledge to meet regularly as a group, help each other succeed in their businesses, and to pay back their loans with interest within a sixteen-week period. When all the loans are repaid, the money becomes available for re-loaning to expand their businesses or the money is made available to new members. Caring people in the U.S. provide the seed capital to establish the "bank" (about $4,000 starts one bank), but after that, the money stays in the local bank and is recycled over and over in loans to these poor, but industrious, widows. The repayment rate is more than 97%!
These women are desperate to feed their children so they are extremely motivated and very successful at making the loans work for them. After they are able to provide food for their families, their next concern is to send their children to school. The women know that this is the best way to secure a better future for their children.
Omega Foundation is pleased to have established four such banks among the women of Goma in the Democratic Republic of the Congo, and the organization will fund more banks in the future as funds permit. You can help reverse the cycles of poverty and the lack of education by making a donation of any amount that will be used to provide seed money for future banks.
