Thursday, May 21, 2015

Micro-financing programmes for non-profit



Anne Phillips discusses micro-financing programmes for non-profit in Africa

“There are many Micro-Finance models available, most offer loans to fund projects in developing countries, but interest charges and terms of the loans will still be beyond the reach of the very poor. Some, for an example, may require the applicant to provide some collateral or a deposit.  For an African village women living on less than $1/day, that is already unattainable. There are many models of Micro finance available, I will tell you about the Ripples Model which is aimed at giving the African Village woman a 'Hand-up' and not a 'Hand-out'.  This is the model used to deliver Ripples in Africa Projects.Ripples projects are delivered primarily in Africa villages or in poor neighbourhoods of large African cities. The main targets are poor women at varying levels of destitution, with no access to credit, no rich relative, no chance of accessing capital, living on less than $1/day. Most of Ripples Women Enterprise Projects are funded by sponsors, these are Corporations as part of their Corporate Social Responsibility or high net worth individuals who want to give back to the less fortunate, without encouraging dependency. Ripples puts a big premium in engaging with the community, so the Traditional ruler plays a major role; he guarantees all loans.  We find that villagers have very high respect for for their Traditional rulers; ranking only next to God.  So no villager will default, this will be equivalent to disrespecting the Traditional ruler. The women are not taught new trades, they are asked to present businesses they have run in the past, but are unable to run now due to lack of access to funds.  Ripples would then after accessing the viability of the business, train the women on ways to run these businesses in a profitable way, including how to scale up.  All projects are audited monthly to provide training and support, and ensure compliance to Ripples’ terms and conditions. We have found that by offering loans to poor African village women at no more that 5% interest, Ripples is able to help the very poor to set up viable businesses that are needed in the community, sustainable, and replicable, because when the loans are paid back it is allocated to another village woman. With Ripples model, the focus is always on the village woman; on what to do to help the village woman work her way out of poverty, it is not a commercial enterprise, it is not profit driven.”
Our Ripples CEO Anne Phillips has a lot of information to share about Africa and non-profit organisations, and is willing to share her knowledge with other like-minded, interested people. To see more questions and answers from Anne, and even to ask a question yourself, please visit Anne's Quora page: http://www.quora.com/Anne-Phillips
Alysha Bennett Web Developer

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