Microlending is a grass roots, bottom-up strategy. It avoids dependence and focuses on the use of existing free-market structures in the local economy. In the process, the working poor develop not only financial self-sufficiency but increased self-esteem and ownership of their own destinies.
Microloans focus on helping individuals grow capital, perhaps for the first time, and thus receive a boost toward a future of financial freedom. With regard to long-term impact, microloans are one of the most powerful ways to help communities in need.
Microloans for micro-business development provide the working poor with the opportunity to make choices, experience a growing sense of dignity, self-reliance and confidence.
World Encounter seeks to empower women with choices and the ability to make changes that benefit their families and communities. With a microloan, women can…
- Work their way out of poverty
- Achieve increased control over their lives
- Provide food, medical care and education for their children
- Grow in self-respect and dignity
- Pursue options, exercise choices and work toward a future of greater independence
In World Encounter’s model, the peer-lending circle supports entrepreneurs who have never before had access to formal credit. The members of the circle co-guarantee each other’s loans, which eliminates the need for collateral.
The strength of these one-on-one relationships is the backbone of the initiative; if one woman can’t make a payment, members of her cohort will chip in to cover her.
Since the beginning of the World Encounter microloan program in 2008, the peer-lending circles have paid back 100% of their loans.