We have recently added a new project in Zambia to our Africa portfolio. We are partnering with MicroLoan Foundation, a British registered charity that has operated in Malawi since 2002. They began a small Zambia operation in 2009 just across the border from their Malawi head office. At the end of 2014 the program agreed to launch their methodology more widely in the country, with five branches planned in the corridor between Lusaka and Livingstone. Whole Planet Foundation will provide the loan capital to support this expansion. We will provide $508,000 in lending capital to the expansion in Zambia over three years- the project objective is to bring quality group business loans to 4,250 new borrowers in the southern region of Zambia.
Brian Doe on our Field Team had the opportunity to meet some of their microcredit clients during his assessment visit before our partnership was approved. One client whose business Brian visited this past November was Sedah, who is running a small shop she built just two months ago, selling potatoes and other groceries.
Sedah borrowed 700 ZMW (about $98) to grow the business. She initially wanted 1,500 ZMW (about $200) but MLF takes a very cautious approach with new borrowers. If you look closely, you’ll notice written on the top of her shop is written, “We don’t give credit.” Her approach makes sense because credit is hard to manage, though it will be interesting to see if her experience with MLF changes her own business approach.
The photos below show how up front capital can immediately improve a business, and we’re sure the new shop was an asset going into the rainy season:
Sedah’s business before her microloan
Sedah’s stand three months after receiving her microloan
For Sedah, that $98 can helped her build a shop from locally made bricks (sourced just a few hundred meters from her stand!). The bricks may not be very expensive by Western standards – but can be out of the reach of someone trying to build a small micro-business.
Sedah has ten kids so she is very eager to see this business grow big. She is in the Twaanguluka Loan Group, one the first in the region as part of MLF’s pilot launch last year, and has 13 members which are all on their first loan with MicroLoan Foundation Zambia. They are currently borrowing as a group 8,100 Zambian Kwacha ($1 : 7 ZMW)to fund an array of small commerce activities near Mazabuka, Zambia. They are on their sixth repayment out of eight and so far all on time.
We look forward to funding MLF microcredit clients like Sedah through this new project.