LOANS FOR HOPE
Micro-finance grants for the unbanked
The overwhelming majority of people in the communities that we work in do not have access to a bank account. Casual workers earn the equivalent of just £1 per day in a country where supermarket prices are almost as high as the UK and rent for a one room home is around £25 per month. Without help, its easy to see how hard working people are caught in the poverty trap which becomes an unending cycle for their children. One of the ways CHI help people out of this cycle of poverty and on the path to self-sufficiency is by providing grants to the local churches in our mission fields, for the purpose of lending small amounts out to people in their parish to start a small business.
Promotes financial inclusion and provides the opportunity for someone to lift themselves and their family out of the poverty trap.
When the loan is repaid, the money is lent out again, multiplying the impact of the initial grant and growing the local economy.
Families utilising these loans are less likely to withdraw their children from school because they can’t afford the fees.
Families in the scheme are able to afford healthcare should they need it.
"I can't thank my Church enough because it took me from nothing, and now I'm a living example to other youths. Thanks be to God"
A small micro-finance loan of around £50 can be enough to start or improve a small business. This can be life changing for the unbanked who rely on casual labour. Fardison is one of many who have benefited from this scheme. He trained in bicycle repairs and started his own business. Three years later he was able to buy a small plot of land and build a house for his family.
WILL YOU HELP SOMEONE START A SMALL BUSINESS AND GIVE THEM HOPE FOR A BETTER FUTURE?
Does Christian Hope International make any loans?
No. CHI only provides grants to its partners, the local church, to lend out. As it is a grant, CHI does not expect any repayments. However the loans are repaid to the church, who then lend the money out again.
Do the borrowers get charged high interest rates?
A small amount of interest is sometimes charged which helps to gradually increase the loan pot and covers any administration expenses. The interest rate, if charged, is below commercial interest rates.
What is the repayment period on the loans?
Typically these are fairly short term loans of around a year.
Where does the capital come from to make the grants?
The funds are sourced from our generous supporter’s donations directly into the loans for hope fund or from our general funds.
What can the loans be used for?
There are no restrictions on what the loans can be used for except that it be business related and in line with our Christian ethos.
How are borrowers selected?
Often the local community comes together and decides amongst themselves who should be next in line to receive a loan. Otherwise, local pastors, who know their communities very well, alongside a church committee, will decide on the merits of the applications received.
What due diligence and monitoring is carried out?
The prospective borrower is required to submit a business plan which is reviewed by our partners on the ground. Once accepted and the terms agreed, the appointed official keeps track of repayments. Community involvement and accountability leads to very low levels of default.