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MicroLoan Foundation Malawi: Helping Women Escape Poverty

MicroLoan Foundation MalawiIn Malawi, where 70% of the population lives on less than $2.15 a day, poverty is not just a statistic—it is a daily reality. Access to traditional banking services remains limited, especially for the 90% of Malawians living in rural areas. Women are disproportionately affected, but one organization is working to change that. Since 2002, the MicroLoan Foundation Malawi has shown that small loans, combined with training and trust, can spark meaningful change.

Women Leading the Way in Malawi

All of MicroLoan Foundation Malawi’s clients are women, most of whom lack access to formal financial institutions. In a country where commercial banks tend to favor men and urban enterprises, this women-first model is intentional. It recognizes that investing in women borrowers contributes to improved household well-being. Women typically demonstrate higher loan repayment rates and contribute more of their income to household needs and prioritize their children’s education and health.

The foundation pairs small, sustainable loans with extensive business and financial literacy training. Every client receives personalized guidance from a loan and training officer, who supports an average of 419 clients. With an average loan size of just £75, women gain the tools to begin a path out of poverty. In addition to financial support, the foundation encourages peer-to-peer mentoring within loan groups.

These networks provide social support and shared learning, allowing women to exchange advice and build confidence as entrepreneurs. Many clients launch small businesses ranging from tailoring to food vending, generating consistent income and expanding their community influence. The ripple effect often extends beyond financial improvement, with women gaining leadership roles in local cooperatives or village committees. These changes contribute to shifting perceptions around gender roles and create new opportunities for future generations.

From Farming to Financial Freedom in Malawi

Many of MicroLoan’s clients are smallholder farmers whose livelihoods are vulnerable to climate shocks and market instability. To support them, the foundation offers agricultural and irrigation loans, allowing women to invest in farming inputs, equipment and resilience. The results include increased crop yields and higher incomes, which in turn support better nutrition, education access—especially for daughters—and long-term financial stability. Since 2022, the foundation has also scaled up digital literacy by training clients across all branches to use mobile money platforms. By the end of 2024, more than 85% of loan repayments and 30% of disbursements were processed via mobile money. This shift helps improve financial control and safety for rural women.

Toward Long-Term Impact

Microfinance continues to support economic participation in underserved communities. In Malawi, targeted lending and training are equipping women with tools to improve household stability and contribute to local development. As MicroLoan Foundation Malawi expands its reach, its model offers insights for addressing economic exclusion through scalable, community-based solutions. Long-term success potentially depends on partnerships that extend beyond lending—such as linking women entrepreneurs to markets, improving access to insurance and integrating climate-resilience training. These additions could enhance economic security and help ensure that microfinance remains responsive to evolving local needs.

– Linnéa Matlack

Linnéa is based in Boston, MA, USA and focuses on Good News and Technology for The Borgen Project.

Photo: Flickr

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Microfinance in Egypt: A Tool to Ease Poverty

Microfinance in EgyptMicrofinance in Egypt has been used to promote financial inclusion and empower low-income individuals, particularly women. It does so by providing them with access to small loans and financial services, allowing them to satisfy their household’s needs independently. This has been supported by both government initiatives and NGOs, helping to stimulate entrepreneurship and improve livelihoods in impoverished communities in Egypt.

The Aim of Microfinance Loans

Among other things, microfinance in Egypt aims to extend loans and other financial services to women who need more collateral to access traditional banking services. The microfinance institution covers around 82% of Egyptian poor and low-income households. It not only empowers entrepreneurs and small businesses but stimulates local economies by promoting self-sufficiency and reducing poverty.

Crucially, microfinance loans have a positive effect on the household incomes of women borrowers. While women make up nearly half of Egypt’s population, they make up less than a quarter of the country’s total labour force, many of whom work in the informal sector. As a result of working for the informal sector, women often cannot access financial services, which is an issue that the use of microfinance loans could tackle.

Prioritizing Financial Inclusion

As part of Egypt’s Vision 2030, the national Egyptian government seeks to prioritize women’s financial inclusion and economic empowerment. Already, the Central Bank has begun initiatives to allow female owners of micro, small and medium enterprises (MSMEs) to be part of the formal financial system, according to the Economist Impact. This is important as the Central Bank’s policies indirectly impact the microlending system where its initiatives to enhance digital financial services and financial inclusion can heighten access to microloans for impoverished communities.

The International Monetary Fund (IMF) calculates that increasing the female labor force participation rate to the male level and increasing employment opportunities could increase Egypt’s GDP by 34%, the Economist Impact reports.

Further Developments

Additionally, to support the government’s efforts, HSBC Bank Egypt and Reefy Microfinance Enterprise Services signed a deal earlier this year to provide 150 million Egyptian pounds to micro businesses in Egypt, with one-third of that figure going towards female-led enterprises. On top of this, HSBC has pledged it will provide between $750 billion and $1 trillion dollars by 2030, to support sustainable financing, the Economist Impact reports.

Despite the significant improvements for some, a large number of old clients who have not seen an improvement in household income following the scheme, remain.

Moreover, there are operational risks such as fraud prevention and technology dependency. The risks of fraud are high considering the digital nature of many interactions whereby the implementation of robust fraud detection systems is crucial. Moreover, technology dependency appears to be another operational risk as “the increasing reliance on technology for loan disbursement and collection processes creates risks related to cybersecurity and system reliability,” according to Andersen. Other potential issues include market saturation or funding and liquidity management. Market saturation means that many “entities are competing for the same customer base,” a current example being Valu.

Overall, microfinance in Egypt offers a promising future for financial inclusion and economic empowerment, bar the potential for certain risks. By providing access to small loans and financial services, Microfinance enables individuals to meet their household needs, stimulate entrepreneurship and enhance livelihoods in underprivileged communities. The support from both government initiatives and NGOs has been extremely helpful in facilitating this process, aligning with Egypt’s Vision 2030.

– Amani Almasri

Amani is based in Durham, UK and focuses on Good News and Technology for The Borgen Project.

Photo: Unsplash

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Grameen Bank: The Power of Microfinance

Grameen BankIn a remote village in Bangladesh, a group of women gather under a large tree to discuss their businesses—small shops, livestock farming and weaving.  With just a few hundred dollars from a local microfinance institution (MFI), these women—who once struggled to make ends meet—now run small businesses that can sustain their families and employ others in their community. This story, even though it takes place in Bangladesh, represents countless regions and people worldwide, showing the power of microfinance in poverty alleviation.

What Is Microfinance?

Microfinance is the practice of offering small loans and financial services to those who don’t have access to formal banking and marginalized groups who face systemic poverty. However, beyond the individual stories, the question remains: can microfinance truly reduce poverty?

The University of Maryland, Baltimore County (UMBC) Department of Economics found that a 10% increase in MFI loan portfolios per capita reduces poverty by between 0.091 and 0.159 percentage points. While these numbers may seem minor, they represent millions moving closer to financial independence.

Grameen Bank

At the heart of the microfinance movement is Grameen Bank, founded by Nobel Peace Prize winner Dr. Muhammad Yunus. Grameen’s model is unique, as its focus is on empowering women, who make up 97% of its borrowers. “We don’t empower women. They already have an inherent power in them because, without that, you cannot survive poverty,” explained Zubaida Bai, CEO of the Grameen Foundation. Its model focuses not only on providing financial resources but also on creating long-lasting, sustainable change by addressing systemic issues such as gender and power dynamics.

Furthermore, Grameen works closely with local partners to dismantle traditional gender roles and enable household dialogues where it challenges male-dominated financial decision-making. “People look at gender issues and say that women are very immobile,” Bai added. “But in reality, they know their system very well. They can be the change-makers within that system and if you enable them, they can make it long-lasting.”

Successes

The success of Grameen Bank is not just anecdotal—data backs it. According to Morduch, Grameen has provided millions of loans, with repayment rates as high as 98%. This high repayment rate reflects not only the bank’s successful lending model but also how committed the borrowers are to improving their livelihoods. Morduch also mentions that even though some institutions need external funding, the social returns on these investments far outweigh their costs. With every dollar lent, microfinance initiatives create a ripple effect that drives community-wide economic growth.

Grameen Bank’s success has benefited millions worldwide. In Uganda, for example, Grameen has worked with refugee communities, particularly women, to bring them into a financially inclusive system. These women undergo gender and power dynamics training and entrepreneurship courses and are given access to digital tools. As a result, “their income goes up by an average of 26%,” says Bai. In India, Grameen has focused on agriculture, working with farmer-producer organizations to bring women to the forefront of decision-making. In the past two years, women’s participation in these organizations has risen by 200%, showcasing how much of an impact women can have if allowed to do so.

The Broader Economic Impact

According to Khandker, microfinance programs have helped significantly reduce poverty, as seen in Bangladesh. His research shows that microfinance participation reduced moderate poverty by 5% and extreme poverty by 10%. Moreover, when applied at a community level, these reductions in poverty were not just for the borrowers alone; non-participants also benefited indirectly from the improved economic conditions. Khandker’s study revealed that more than 40% of the reduction in poverty in rural Bangladesh between 1991 and 1998 was attributed to microfinance programs.

Crépon, Devoto, Duflo and Parienté found in rural Morocco that microcredit increased ownership of assets, such as livestock and household goods. This shift toward increased assets is crucial because it gives families a buffer against economic shocks, allowing them to survive crises like illness or natural disasters. Microfinance also supports financial literacy. Programs like Grameen don’t just provide loans; they offer training in basic financial management so that borrowers can manage their resources properly. As a result, microfinance promotes saving and investment, leading to sustainable economic growth in low-income communities.

Criticisms and Challenges

While there are numerous benefits of microfinance, it still has its flaws. Some argue that microloans can lead to over-indebtedness, particularly when borrowers take out multiple loans from different MFIs. Additionally, high interest rates in some regions have raised concerns about the long-term viability of microfinance programs. However, Grameen has implemented measures to mitigate these risks, such as peer lending groups that foster accountability and household dialogues that address gender imbalances in financial decision-making.

A Path to Poverty Alleviation

Microfinance could be a powerful tool in the fight against poverty. From Bangladesh to Uganda, Grameen has shown how small loans can lead to significant social and economic change. By focusing on empowering women, addressing gender dynamics and leveraging digital technology, Grameen Bank continues to make a change in the field of microfinance. With every loan that helps an individual, a family and a community, these small steps are what create significant change in the fight against global poverty.

– Danica Lourdu Nelson

Danica is based in Parker, CO, USA and focuses on Business and New Markets for The Borgen Project.

Photo: Pexels

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Empowering Communities: Reducing Poverty in Indonesia

IndonesiaIn Indonesia, grassroots nongovernmental organizations (NGOs) are pivotal in alleviating poverty, particularly in rural areas. Their reliance on volunteers, temporary workers and bottom-up approaches characterizes their efforts, a central aim of addressing socioeconomic and cultural challenges.

Poverty in Indonesia

According to the Asian Development Bank (ADB), 9% of Indonesia’s population lived below the international poverty line in 2023. Although this is the lowest poverty rate in the last 10 years, more than 25 million Indonesians still experience poverty. Some of the causes of poverty in Indonesia include:

  • Economic Deprivation: Indonesia hosts some of Southeast Asia’s largest commodity export, manufacturing, services, dairy and digital export markets. However, its financial markets are still emerging and there is little integration into the global financial system. This restricts economic productivity and global financial influence. Similarly, with many areas still lacking basic infrastructure, such as quality roads, this delays rural populations’ access to the secondary job sector in cities that currently run the country.
  • Social and Cultural Factors: Strong family and cultural norms across Indonesia lead multigenerational families to live together. The natural sharing of limited resources this ensues often perpetuates poverty as individuals less regularly leave impoverished local communities.
  • Gender Inequality in Indonesia: Certain beliefs across Indonesia can result in women facing lower social mobility, wages and greater job insecurity. These cultural norms and gender biases limit women’s opportunities for education and employment, perpetuating a cycle of poverty. Desperation for an income and city experiences can also result in young, vulnerable (often rural) women either choosing or being forced into sex work, further entrenching their economic hardships and lack of social mobility.
  • Environmental Vulnerability: Natural disasters such as earthquakes and floods disproportionately affect people experiencing poverty and are common throughout Indonesia. In 2022, Indonesia experienced one of its worst earthquakes, which killed about 900 people and caused extensive damage. Natural disasters can increase poverty by more than 2% in affected areas.

Yayasan Kampung Halaman

Established in 2006, this Yayasan Kampung Halaman empowers rural youth through education and creative expression. Based in Yogyakarta, it helps them develop critical thinking skills and community participation through its endeavors. Programs include media production for educational purposes, community labs for social research and literacy campaigns that use various media formats like films and social media to raise awareness of social issues. ​ The organization received the International Spotlight Award from The National Arts and Humanities Youth Program in 2011, highlighting its impact on youth engagement through creative storytelling.

Koperasi Kasih Indonesia

Koperasi Kasih Indonesia (KKI) is a cooperative organization founded in 2011. It provides microfinance services to low-income families, primarily focusing on women in North Jakarta. Honing in on gendered experiences of inequality, the cooperative follows the Grameen model, which emphasizes small loans to help individuals start or expand small businesses. KKI currently serves more than 9,000 members and has disbursed more than $10 million in microloans. The organization aims to empower the urban poor through financial support and by offering mindset-motivation training to foster sustainable economic growth and self-sufficiency.

Rumah Yatim

This NGO supports orphans and vulnerable children by providing education, health care and basic needs, helping them break the cycle of poverty. Rumah Yatim aims to empower these children to achieve their full potential and contribute positively to society by offering a safe and nurturing environment. The comprehensive care provided by Rumah Yatim includes basic necessities and emotional and psychological support to ensure holistic development. The organization has reached approximately seven million people since its inception.

Sahabat Anak

Dedicated to street children, this organization offers education and social services to reintegrate them into society and ensure their well-being. It provides educational programs and social services to help reintegrate these children into society. This local effort tries to ensure street children have access to education, health care and a supportive community, bettering their futures and trajectories.

The Indonesian government and international organizations recognize the importance of grassroots NGOs in poverty alleviation. The National Program for Community Empowerment (PNPM) exemplifies this. PNPM encourages local community groups such as Yayasan Kampung Halaman, Koperasi Kasih Indonesia, Rumah Yatim and Sahabat Anak. PNPM aims to include a national body in community-led poverty alleviation activities to enhance partnerships between centralized and localized services.

Conclusion

Grassroots NGOs are indispensable in Indonesia’s fight against poverty. Community ties, participatory approaches and adaptability make them uniquely capable of addressing poverty’s complex and multifaceted nature. By empowering local communities, these organizations ensure that development initiatives are effective, sustainable and culturally appropriate.

– Olivia Howard

Olivia is based in London, UK and focuses on Technology and Global Health for The Borgen Project.

Photo: Flickr

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Microfinance: Firms Providing Small Loans to Fight Poverty

Microfinance: Firms Providing Small Loans to Fight PovertyMicrofinance provides small loans, savings, insurance and other financial services to underbanked individuals, families, entrepreneurs and small businesses that lack access to conventional financial sources. The 2023 Microfinance Social Performance Report by BNP Paribas reports that 156.1 million borrowers globally benefited from these services in 2022. Here are three companies that offer small loans to fight poverty, along with success stories of people who have used these loans to expand their businesses.

KIVA and Rachel’s Story

Kiva offers banking services to the international community, functioning similarly to a crowdfunding platform. As a lender, individuals can browse various projects globally and choose whom to lend to. In 2023, Kiva facilitated loans for more than 190,000 people, distributing more than $176 million with an impressive 96.2% repayment rate. Additionally, Kiva has partnered with Novica, an e-commerce platform that allows people in developing communities to sell their products internationally. This partnership has generated more than $130 million for individuals, enabling them to share their skills and products worldwide and drive tangible change.

Rachel, who grew up attending the Odwira Festival in Abiriw, Ghana, was captivated by the colorful garments and accessories celebrated during the harvest. Inspired, she learned to create similar items from a friend and began selling her wares. Although she experienced modest growth, Rachel sought to accelerate her business. Partnering with Kiva, she received $100 from four donors, which she used to buy raw materials, effectively doubling her production and profit. Rachel now employs others, imparts valuable skills and runs outreach programs that teach underprivileged youths how to make tie-dye and batik at no cost.

Micro-loan Foundation and Lydia’s Story

The Micro-loan Foundation has been empowering women in Malawi, Zambia and Zimbabwe since 2002 by providing business training and small loans. To date, it has assisted more than 450,000 women, enhancing food security, health care access and educational opportunities and boosting women’s roles in their communities. Lydia, a single mother of four and caregiver to her mother-in-law, turned her passion for baking into a sustainable business. With a micro-loan of 500 Kwacha (about $30), she invested in her bakery, quadrupling her daily bread production and significantly boosting her income. This increase allowed Lydia to reinvest in her business, repay her loan and improve her family’s living standards while contributing more to her community.

BRAC and Sharmin Akter

BRAC, originally an NGO in Bangladesh, has evolved to provide small loans aimed at alleviating poverty and promoting financial inclusion. Since 2023, BRAC has disbursed more than $6 billion in loans, mainly focusing on women, who constitute 90% of its beneficiaries. These ongoing efforts empower women and address the root causes of poverty, particularly in urban areas of Bangladesh.

Sharmin, who worked for a decade in a toy factory, acquired valuable skills that she leveraged to start her own business. Her high-quality toys quickly garnered demand, but she struggled to keep up with growth. Realizing the need for investment, Sharmin secured a $3,750 loan from BRAC to purchase 12 new sewing machines. This capital infusion allowed her to expand production by hiring staff and increasing output. At the moment, Sharmin’s business is one of the largest soft toy manufacturers in South-West Dhaka.

Looking Ahead

Small loans continue to play a crucial role in the fight against poverty and economic empowerment worldwide. Success stories like those of Rachel, Lydia and Sharmin highlight the transformative potential of these financial services. As microfinance institutions like Kiva, the Micro-loan Foundation and BRAC expand their reach, they can potentially create sustainable livelihoods and foster economic growth in underbanked regions.

– Philip Mundy

Philip is based in Bristol, UK and focuses on Good News for The Borgen Project.

Photo: Unsplash

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Economic Inclusion of Women in Uganda

Women in UgandaIn Uganda, women continue to find their capacity to materialize their potential hampered by deeply entrenched inequalities despite considerable political progress. The 1995 constitution rendered men and women equal before the law. Since then, numerous governmental initiatives have sought to eradicate gender-based discrimination. This includes the 2007 establishment of the Equal Opportunities Commission, a statutory authority that works to enforce anti-discrimination laws and equalize opportunity.

However, the United Nations (U.N.) has identified a chasm between this politically decreed equality and the living reality of Ugandan women, social mores frequently limiting their engagement in the public sphere. The result is a gaping monthly gender wage disparity of 32.3% and a mammoth loss in human capital and, thus, national wealth. Organizations of varying scales are, therefore, working to foster the economic inclusion of women in Uganda.

Resilient Women Uganda

Established in 2016, Resilient Women Uganda is a nongovernmental organization (NGO) that helps vulnerable girls and women escape cyclical poverty by creating spaces where they can blossom unimpeded by patriarchal beliefs that undervalue them.

Harmful practices mar the economic inclusion of women in Uganda. A massive 45% of female Ugandans have suffered physical abuse at the hands of their partner. Additionally, more than one in five have experienced sexual violence. Moreover, child marriage is rampant, with 34% of girls entering unions before they turn 18 and 7% before the age of 15.

Seeking to limit the effect that these breaches of basic rights have on girls’ development, Resilient Women Uganda operates a shelter for those in immediate danger of violence or exploitation, where they can access food, medical treatment and pastoral care.

Furthermore, the organization offers vocational training in various sectors, supporting its beneficiaries in sculpting a future. Through the program, at-risk girls aged between 13 and 19 can develop skills that will lead them to secure employment and become economically self-sufficient members of society. In 2023, 55 young women trained by the program found jobs in hairdressing and fashion design.

The Women’s Microfinance Initiative

The Women’s Microfinance Initiative (WMI) empowers female entrepreneurs from impoverished rural communities by providing them with microloans and increasing their financial literacy. Founded in Washington, D.C., in 2008, the organization operates through hubs across Uganda, Kenya and Tanzania.

The “Transition to Independence” program gives women access to four consecutive loans at a 10% flat interest rate, which they can use to propel their businesses into economic self-sufficiency. The program also provides a holistic support system that seeks to mold its beneficiaries into well-rounded participants in the economy. At the community-level hubs, operated by local women, the borrowers receive training in business and marketing, ongoing mentoring and free bookkeeping resources such as calculators and notebooks. They also open bank accounts as part of the program and develop a strong grasp of financial processes.

WMI combats exploitative lending practices through its woman-centered approach, which is reflected in an impressive loan recovery rate of 98%. Its borrowers experience a monthly income growth rate of between 100% and 400%. The organization’s impact is as far-reaching as it is remarkable; in 2023 alone, it provided 12,000 loans and it has served more than 28,000 women since its inauguration.

Moreover, WMI estimates that its loans impact an additional 20 people for every borrower. This considers the effect of increased household income on family members and the reach of each business’s roots within the community’s economic network. According to the U.N., self-employed women in Uganda face heightened vulnerability to poverty due to limited access to services and capital. WMI is working to remove these barriers and allow female entrepreneurship to flourish.

Women in Technology Uganda

Women in Technology Uganda (WITU) is an NGO that has supported girls and women from underprivileged communities with training programs in technology and entrepreneurship since 2014. The “Code Girls” program operates across primary, secondary and tertiary education to bring ICT training to young people, especially girls, who are otherwise unlikely to access STEM resources. In 2022, the program bridged the technological divide for 1,354 students.

WITU also offers talented young women the opportunity to complete a two-year diploma in Computer Science and Entrepreneurship through the Women’s Institute of Technology and Innovation. In 2022, 33 girls excluded from tertiary education because of a lack of financial means received scholarships.

Moreover, the 12-week “Elevate” program fosters economic autonomy by training young women from marginalized backgrounds in ICT and providing them with various marketing and employability skills. As of 2022, the program had served more than 6,000 women. Given that just 31% of Ugandan women have access to the internet, compared with 69% of men, WITU’s work represents a vital pathway toward improved economic inclusion of women in Uganda.

Moving Forward

Although significant challenges remain, numerous organizations are working to strengthen Uganda’s social fabric by fighting for a future where its women are free to incorporate their unique and colorful threads. Their efforts demonstrate what WMI aptly calls “a long-term investment in human potential” and their shared vision is one of a nation that holds equal promise for all of its people.

– Leila Powles

Leila is based in Cheltenham, Gloucestershire, UK and focuses on World News for The Borgen Project.

Photo: Pexels

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Charities Fighting Global Poverty That You Need To Know About

Charities Fighting Global PovertyAccording to World Vision, a staggering 9.2% of the global population lives in extreme poverty, facing daily struggles for necessities. Yet amid this stark reality, there emerges a beacon of hope: passionate individuals who refuse to accept the status quo. Driven by a deep sense of empathy and urgency, these individuals have taken it upon themselves to initiate ripple effects of change, sparking movements that resonate across continents by establishing impactful charities fighting global poverty.

In this exploration of grassroots activism and compassion, we highlight three remarkable small charities fighting global poverty. These organizations not only exemplify the power of one person’s determination but also serve as tangible manifestations of the collective desire to alleviate poverty and injustice on a global scale.

Concern Worldwide

Founded by John and Kay O’Loughlin Kennedy in 1968, Concern Worldwide emerged from the heart of Ireland during a tumultuous period known as the Troubles. Despite the challenges in their own homeland, the couple was deeply moved by the crisis unfolding in Biafra and felt compelled to take action. Over the years, Concern has grown into a formidable force for good, reaching an astounding 36 million people globally with its humanitarian efforts in 2022.

Operating in 26 countries, primarily in Africa and the Middle East, Concern’s impact resonates across continents. Its dedication to alleviating suffering and addressing the root causes of poverty is evident in its latest endeavor in Sierra Leone, where it established a pioneering program aimed at strengthening food systems to combat nutritional insecurity. Through its tireless work and unwavering commitment, Concern Worldwide continues to be a beacon of hope for millions around the world.

Green Shoots Foundation

Jean-Marc Debricon established the Green Shoots Foundation in October 2010. The charity began its journey with a focus on microfinance, a tool described by Habitat for Humanity as vital in providing financial services to socially excluded populations. Over the years, the organization has expanded its vision, evolving into a beacon of hope for impoverished communities across Asia. With a multifaceted approach encompassing education, medical aid and economic empowerment, Green Shoots is dedicated to alleviating poverty at its roots.

The Green Shoots Foundation is present in seven countries across the region. From providing nearly 7,000 hours of training for health care professionals in Myanmar to empowering 5,500 students through its Food and Agriculture program in the Philippines and Cambodia, Green Shoots Foundation is sowing seeds of change and fostering sustainable development in some of Asia’s most vulnerable communities.

World Cow

Nestled in the picturesque landscape of Vermont, USA, World Cow stands as a testament to the power of art and altruism. Founded by D.J. Barry, this organization is on a mission to spread a message of unity encapsulated in its poignant slogan, “We’re all spots on the same cow.” In an interview with The Borgen Project, Barry noted that his inspiration stemmed from his deep love for street art and the serene beauty of Vermont, culminating in the creation of the iconic image of a Holstein cow adorned with the world map as its spots.

What began in 2015 as “Cow For A Cause,” a humble initiative by Barry and his family to raise funds for local charities addressing poverty in Vermont, has blossomed into a global movement. World Cow’s reach now extends far beyond Vermont’s borders, with impactful projects in diverse regions such as the Democratic Republic of Congo, where it nurtures the art movement and in India, where it provides essential resources like food, stationery and clothing to those in need.

Barry’s impact is global and everlasting. He described World Cow as “not something that can just go away because you see tattoos of it or these murals that are lasting for decades. It’s being printed everywhere and I think that the herd story, even long after I’m gone, will continue to inspire and grow, so I’m leaving that mark everywhere.” By fostering the arts in vulnerable communities, World Cow provides inspiration, enrichment and motivation for people suffering from the multifaceted dimensions of poverty. Through this innovative blend of art and activism, World Cow continues to sow seeds of hope and solidarity across continents.

Final Remark

The collective efforts of small charities fighting global poverty serve as a testament to the power of grassroots initiatives and individual determination. Despite limited resources, these organizations have managed to create significant impacts, reaching vulnerable populations and addressing systemic issues at the local and global levels. Through innovative approaches, unwavering dedication and a deep commitment to social justice, they have brought hope and tangible change to countless lives.

These efforts are working. Since 1990 the percentage of people living in poverty has declined from more than 50% to around 35%. Finally, as we celebrate their achievements, it becomes clear that the fight against poverty is not insurmountable and that every contribution, no matter how small, plays a vital role in building a more equitable world.

– Lauren Mckenna

Lauren is based in Manchester, UK and focuses on Good News for The Borgen Project.

Photo: Unsplash

How MFIs Contribute to Alleviating Poverty Among Indian Farmers

MFIs in IndiaIn India, where 52% of the population engages in agriculture, a significant number of the rural population depends significantly on this sector for their livelihoods. As reported by the Hindustan Times, about 20% of this agricultural population lives below the poverty line, forcing a majority of them to seek loans from informal sources to sustain their businesses. As poverty increasingly affects Indian farmers, microfinance institutions (MFIs) play a crucial role by providing small, formal loans to empower them in their struggle. In a country where sociocultural factors hinder economic growth for small farmers, MFIs in India endeavor to overcome these barriers by facilitating quicker access to capital, especially for those who do not qualify for traditional bank financing.

Casteism: A Deep-Rooted Cultural Issue

Casteism, a cultural community hierarchy in India, although outlawed in the 1950s, still has clear implications in today’s Indian societies. About 82% of Indian farmers belong to marginalized communities and classes. Caste-based discrimination in India also extends to the financing sector, where members of the lower caste are forced to take out loans from informal sources. The risks and often high collateral from these informal sources lead to a perpetual spiral into poverty for these low-caste individuals.

The establishment of MFIs in India streamlines the process of receiving small loans for individuals facing caste-based discrimination. Microfinancing groups like Annapurna Finance and Fusion Microfinance play a crucial role in alleviating the financial challenges of these small, underserved farming communities in India. By specifically targeting these marginalized groups, these groups bring more formal and legitimate loan opportunities for these farmers. Access to formal loans reduces the risks associated with regulatory oversights and legal issues, enabling marginalized farmers to repay these MFIs in a much more relaxed manner.

Empowering Disadvantaged Women Farmers

Some MFIs in India not only make it a priority to provide microloans to women but also educate them on agricultural development. The Society for Elimination of Rural Poverty (SERP) in the South Indian state of Andhra Pradesh focuses on underprivileged women, establishing self-help groups through the provision of microloans and imparting market knowledge. The market knowledge provided by SERP includes understanding how third-party groups can exploit their profits and how to spend less money on seeds, fertilizers and pesticides. This knowledge has helped several female farmers to break “from the shackles of money lenders and traders.”

Many rural women in India are often rejected loans from banks due to their illiteracy or even asked to provide collateral even if they have no assets in their name. This proves to be a major problem, leading them to face local debt collectors and loaners who often have high-interest rates. When organizations like SERP started offering legitimate microloans and financial knowledge, individuals no longer needed to resort to loan sharks. This alleviates the stress associated with informal sources of loans, empowering them to pursue their livelihood as farmers. Simultaneously, it provides them with opportunities that can contribute to lifting them out of poverty.

Key Notes

Microfinance institutions in India are making strides in empowering marginalized farmers, particularly those affected by caste-based discrimination. By providing formal and legitimate loans, such as those offered by Annapurna Finance and Fusion Microfinance, these organizations help break the cycle of poverty perpetuated by informal sources. Moreover, initiatives like the SERP focus on educating and financially empowering disadvantaged women farmers, offering them an alternative to exploitative moneylenders and contributing to their economic independence. Overall, these efforts signal a positive shift toward sustainable rural development in India.

– Aswath Jaiprakash
Photo: Flickr

How Rafode is Changing Lives and Economies

Rafode
For many years, microfinance was viewed as one of the most successful means of raising individuals and communities out of poverty. In Myanmar, small and medium enterprises made up 99% of the country’s businesses. Most of those were, to no surprise, micro-businesses. In particular, the tool of microfinance was viewed as especially helpful to women. Yet, it turns out that studies found that microloans were not actually as impactful as many wanted them to be. The problem is that, because microloans are often given to those considered high-risk borrowers, high-interest rates are charged, making it difficult for those receiving the loans in the long run. The way to make microloans sustainable is by diverting the focus away from scalability and immediate returns. Rafode, a startup in Kenya, has done just that.

Headquartered in Kisumu, Kenya, Rafode is a “non-deposit taking Microfinance Institution.” With its main focus on women in rural communities, Rafode has successfully distributed over 40,000 loans, all with a value of around 700 million Kenya Shillings or $6.5 million. Relying on technology to deliver its products and services, Rafode has succeeded in reaching rural communities and uplifting both men and women through microloans.

Products and Services

Rafode has eight different products, all in the form of loans for different purposes.

  1. Inuka Business Loan: As a group loan, this is intended to encourage clients to create, upgrade or expand a business. This loan is the first step to receiving an individual loan and can range from 10,000 to 480,000 Kenya shillings.
  2. Masomo Loan: Dedicated to education, this loan is aimed to support a client’s family in receiving an education.
  3. Green Energy Loan: Working with other companies that provide green products, including Burn, Marathoner and Sunking, this group loan provides support for rural clients seeking access to affordable green energy products.
  4. Agribusiness Loan: As the name would suggest, this loan exists to specifically help small scale farmers in the agribusiness industry.
  5. Pamoja Loan: As another group loan, this works to support a group hoping to support its local economy.
  6. Emergency Loan: As an individual loan, the Emergency Loan serves to cater to the client’s emergencies, typically related to their business.
  7. Individual Business Loan: A more selective loan to receive, this loan exists exclusively for clients who already have businesses, and who already have businesses that are stable and have a reliable source of profits.
  8. Asset Loan: This final loan is self-securing. Providing real flexibility to clients, they gain the ability to finance movable assets and free up cash they might not have had before. Like the Individual Business Loan, this exists for clients who already are seeing their business profit, and hope to expand or grow it even more.

The Value of Microfinance

While conventional microloans have not been so effective, researchers have found that by providing microloans with little to no collateral, there are usually better results. Specifically, when given to women, these results are even more effective. This is because, especially in developing countries, microloans are among the only things that increase women’s decision-making power. In other words, microloans undeniably empower women.

So, Rafode’s efforts to give 85% of their microloans to women, focusing on rural communities and offering a plethora of different types of loans, all with very little collateral, have enabled this startup to do extremely impactful work that provides mutual benefits to the clients and back to the company. The most successful microfinance products allow flexible payment periods, individual liability contracts and one of Rafode’s main tools, the use of technology.

By believing in microfinance and adjusting to what will work by trusting in their clients, Rafode has raised individuals and families out of poverty, as well as revitalized economies in the process.

– Olivia Fish
Photo: Flickr

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Table Banking Empowers Women in Kenya

table banking in Kenya
Table banking is a group-based funding strategy in which members form groups where they can save and borrow money immediately during meeting times. The objective of the strategy is to help the poor, particularly women, fight poverty and stay financially sound. About 97 percent of table banking members in Kenya are women.

Members of a table banking group save money each time they meet from which they can take either short or long term loans. The repayment of these loans is what helps to grow the group’s revolving fund. Different groups have varying methods of how they can raise additional funds. Some tactics include investing in land, applying for grants from county governments or fining members for lateness and absenteeism.

How Table Banking is Different From Conventional Banking

Table banking in Kenya became popular among women because it made it easy for them to access loans without land. Additionally, it means that they no longer have to go through microfinance institutions to get loans. While table banking groups have similar principles as a guide, each group creates and agrees on their own rules such as which members can receive loans and what the terms of repayment are. This means that interest rates can be as low as 1 percent, compared to an interest rate of 12.39 percent in banks.

Another key difference between conventional banking and table banking is that when a member of a table banking group gets into difficulty in terms of repaying their loan, their group members assist them to overcome those difficulties. As the group members are dependent on and accountable to one another, the loan repayment rates tend to be high.

Benefits of Table Banking

Table banking has given women, who were once totally dependent on their husbands for everything, the ability to support their families as well. Women have been able to help out when it comes to paying school fees and rent as well as purchasing groceries and other household goods. The Joyful Women Organization (JOYWO) reports that as women increasingly become part of the source of income for their families, people no longer view them as liabilities. This has strengthened family bonds.

In addition to financing household activities, table banking in Kenya has enabled women to create small businesses or to expand their already existing ones. JOYWO, which is one of the most visible table banking movements in Kenya, has documented success stories of women who have put up rental houses and started small shops where they sell various items.

Table banking in Kenya has also given women the ability to buy and own land. Reports show that while women can constitutionally buy and own land, less than 7 percent of women have title deeds.

Women in Africa contribute between 60 percent to 80 percent of food, but they only have an estimated 5 percent access to agricultural extension services. The Global Report on Food Crises 2018 estimates that at least 25 percent of Kenya’s population is food insecure as a result of dry weather. As more women take ownership of land, they will be able to use their harvest as food to feed their families or as a means of income which will enable them to buy what they do not have at home, making their families food secure.

Conventional Banks are Taking Notice

The Central Bank of Kenya shows that women currently account for at least 82 percent of total savings in Kenya. Leading banks in the country are taking notice of the effects of table banking in Kenya and most of them now have group accounts to entice the various groups. Additionally, the banks are now reaching out to the various groups and offering them loans on friendly terms.

Table banking in Kenya has been a game-changer for women as individuals as well as for their families and it is going a long way in helping lift people out of poverty.

– Sophia Wanyonyi
Photo: Flickr