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A 10% increase in loans to women allows for an average increase of 8% in children's school attendance and a 5% drop in extreme poverty

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Microfinance services provide valuable tools for building a more egalitarian society where women have the means to become self-reliant.

They are microfinance

Women are particularly affected by financial exclusion. According to figures from the World Bank of 2014, more than 40% of the world's female population does not have access to formal banking services. Compared to a man, a woman has 20% less chance of owning a bank account.

 

Although financial inclusion has risen sharply in recent years, showing a 13% improvement between 2011 and 2014, the gender gap has remained the same and still stands at 9%.

Disparité-HF-EN

(source: Global Findex Database 2014)

 

Yet studies have shown that women are more likely to spend their financial income on health, nutrition and schooling. Many women turn to microfinance services to get out of poverty. Today, micro-entrepreneurs are mostly women. They represent 73% of microfinance clients according to 2013 figures.

The International Labor Office explains this majority of women among microfinance clients by two factors:

- women are more affected by poverty: 70% of the world's poor are women

- women are more reliable in repaying their credit: the rate of recovery of MFI women clients is 98%

Discover the life stories of entrepreneurs, real heroines of modern times who, thanks to our action in microfinance, were able to create their income-generating activity and get out of poverty.

 

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Engracia, baker in Cape Verde, describes her experience in micro-entrepreneurship

"My name's Engracia and I live in Tira Chapéu, one of the municipalities of Praia, the capital of Cape Verde."

I live with my husband José and our five children.  We set up a small bakery on the first floor of our home. We make bolachas, a sort of cookie typical of our area.

Difficult beginnings

At the beginning we had just one oven and no staff to help us. José was exhausted because he had to bake the biscuits and then sell them in town. He went there by bus and on foot. We didn't earn much money and we always had to wait until we had sold all our biscuits before we could buy the ingredients for a new batch. It was difficult.

Then, one day, a friend of José's told us he'd been able to expand his small factory thanks to a microloan. We decided to give it a go. An agent from the Solmi microfinance institution came to see our bakery and we got our first microloan. We used the money to buy a second oven and a stock of flour, and we started to make more biscuits.

Microcredits to grow

We've since taken out a few microloans that we used to expand our workshop, replace our old equipment and buy a van to deliver cookies in town. We've grown so much that we even hired a few apprentices. Now, eight young people work in our workshop. In the beginning we went through a 200 kg sack of flour every week. Now we use one every day! Because we now buy more ingredients at the same time, we pay less for them. Our supplier gives us a discount if we buy 10 sacks of flour in one go.

The microloan really improved our lives. We've been able to send our children to school and José is less tired now thanks to his van and the employees who work with us. José also took a course in small enterprise management at the microfinance institution. He is now very skilled at managing our bakery. We feel stronger and freer.

Over the next few years we'd like to make our biscuits even better by purchasing higher quality products. We'd also like to expand the workshop a bit and get newer equipment, as we still use wood ovens for baking. We'd also like to sell our produce farther from here, outside the capital and, why not, beyond the island of Santiago.


Isabel

Isabel Trujillo, innkeeper in Peru

"My name's Isabel and I live in Coporaque, a small village sitting at a height of 3,575 metres in the Colca Canyon. In 2009, I outfitted two big rooms in my house to create a small inn I christened "Casa del Inka". I rent out the rooms to tourists travelling through the region. I live with my husband and our three children, who are 16, 13, and 11 years old. 

When the rooms are not occupied, I leave with my husband in the morning to work in our corn, bean, and pea fields. We also own a small herd of cattle and sheep. If we've got tourists at the inn, I stay to make them breakfast and take them on a tour of the village. Sometimes, I teach them to cook local dishes. I do my best to make sure they enjoy their stay. 

Here, the nights are cold, and tourists like to have hot showers. I used to have an electric water heater that broke down all the time and consumed lots of electricity. It made me angry when there wasn't any hot water for the tourists to have showers.

One day, I heard on the radio that the microfinance institution Fondesurco was offering microloans for purchasing solar water heaters. This piqued our interest, and my husband and I asked the institution for further information. We decided to apply for this microloan, which enabled us to buy a solar water heater. We repaid it after one year in monthly instalments. The installments weren't too high, so we didn't have any trouble paying it back.

Now, I'm certain of having hot water for tourists at all times, and I don't have to worry about the electric system. Thanks to this new service, I was able to raise my rates. I also use hot water for household chores. My husband is delighted at being able to have a hot bath when he gets home from the fields. I also wash clothes with hot water now. It's much more effective. 

My electricity bills have come down a lot since I got the solar water heater. Moreover, it doesn't harm the environment or pollute. Protecting nature and our children's health is important. Tourists also like the fact that it's a green system; in fact, some of them come to my inn for this sole reason. 

I use the money I make by renting out the rooms to pay for my children's tuition. I'm even thinking of sending my eldest child to university.

At the beginning, I didn't use hot water because I wasn't used to it. The water heater boiled over and this got me worried. I called the institution and they sent a technician round. He told me that it wasn't a big deal if the water heater boiled over, but also that I should have no qualms about using hot water myself. So, I started to use it for household chores; and now, I couldn't go without it!

I'd like to buy a low energy consumption oven for my kitchen sometime in the future. There's also a microloan for purchasing this type of oven. I'd also like to have solar lamps for the evening. Tourists like to have some light when it gets dark. I'd also like to make the inn bigger and add a few rooms. Microloans help me to improve my inn little by little while protecting the environment and our health. I'm very happy I came across microloans and solar power, and delighted that my family is reaping the benefits."


 

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