A group will go through stages of preliminary learning, and refinement with an agreed upon strategy that ultimately results in group ownership and administration of their loan.
To enable Belizeans to earn a living through their own micro businesses with a strategy called the Manna Village Fund.
Approaches money as stewardship and maintains an ethical standard. Some traditional financial services are available to residents of Belize, usually within a larger town in a district. There are three branches of national banks in Corozal Town, as well as a few credit unions. When traditional banking services are unavailable to an individual (whether because they do not have adequate collateral for a loan or travel costs are too high on a regular basis), pawnshop and loan sharks operate within the informal financial sector as moneylenders. Through The Manna Village Fund, The Belize Project offers an alternative to traditional banking and usurious money lending through both individual and group-based microfinance initiatives.
A group of 5-8 women from a community come together to form a loan group. The Manna Village Fund provides the seed money for the first loan cycle, which lasts 6 months. These are micro loans, ranging from $200BZD to $600BZD ($100-300 USD).
The group meets on a monthly basis to discuss their businesses, encourage one another, receive training, and make their loan payments. Through this time of sharing, members of the group learn that together they are smarter than they are alone. They learn that they can help each other be successful. Additionally, they watch and reflect on a video from the God Provides curriculum on Godly stewardship. Members from the loan groups currently operating agree that this time spent together is both necessary and beneficial to their lives and their businesses.
The group understands that each member must pay back their loan in full in order for the funds to be available again to the group for the next loan cycle. While the members are not liable for each other, it is in their best interest to help and support each other. For example, if one women is not able to make her loan payment in full one month, she is able to approach other women in the group to help her make that payment on time, and then pay them back in the weeks following. Trust and friendship are strong within these loans groups.
At the end of the 6 month period, once the loan is paid back in full and the group is eligible for another loan, the members can decide if they want to add another member to the group or continue on with their group and launch another loan cycle.
A 12% interest fee is added to each member’s monthly payment – 8% for administration and 4% for group savings. The loan administrator is responsible for collecting and depositing payments into the Manna Village Fund bank account, as well as keeping records and writing receipts. By building savings in to each loan payment, the group has a safe and accessible way to save their money, and at the end of each loan cycle the group has increased their loan fund for the next round. As their businesses grow, so does the group’s capacity to lend larger sums of money.
For Example: one member in a group takes out a $300 loan plus 12% interest. Her total loan payment = $336, paid in 6 monthly installments of $56. Starting with a total loan of $2500, when every member pays back her loan the group fund is then $2600.
Occasionally there is a request for a significantly larger loan. While that individual might have a wonderful business proposal, the loan size is too large for this program.
If you are interested in starting a group in your community, let the administrator know of your interest. Email Ezekiel Yah email@example.com. He will come to your village and speak with the church leadership about what is involved in the process of promoting but not sponsoring the fund. He will also conduct an open meeting for everyone in the community that has expressed an in starting a loan group to answer questions. Samples of types of loans will be shared, and those who are interested will have the opportunity to fill out an application with a very simple business plan. These applications are gathered and sent to the investors for review and approval. Once a loan is approved and there are at least 5 members, the group is formed and the first loan cycle begins.
The Manna Village Fund loans are church promoted, not church sponsored. The church is encouraged to tell everyone in the village about the opportunity to be part of the loan group, which in turn can be a way for the church to serve the community in a new way. While the church promotes the loan, the loans are made directly from the Manna Village Fund, and the church is not liable for the success or administration of the loan.
Group meetings are held in the same place at the same time each month. For example: the last Friday of the month at 4pm at the church. Every member is required to attend each meeting.
Payments are made in front of the group so that everyone sees each other making their payment. This is critical to building trust within the group. Each member is given a written receipt of their transaction as well.
Training is provided to members of the group, and the sharing of ideas among members is encouraged. Training includes problem solving, budgeting, saving, reinvesting, bookkeeping, stewardship, and material from the God Provides curriculum. The group uses a business training booklet written by the women’s entrepreneurial department in Belize.
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