WMI Borrower Training Session
We hope that you are continuing to stay safe and well this summer. Although the world has changed substantially in the past six months, we are happy to report that Women’s Microfinance Initiatives are continuing, although at a slower pace than planned. We were fortunate that we were able to start most of our new initiatives early in the year before Covid-19 closed down much of the world. Loans were issued in January and, in some areas, again in July and August. Government lockdowns have eased in Uganda, but Kenya is still on hold. Tanzania is operating in a quasi-normal state as the government is not issuing any Covid-19 guidelines. This does not mean, though, that our borrowers are not experiencing difficulties.
Many loans are being repaid at a very slow rate as our borrowers’ businesses slowed or even shut down temporarily. The largest percentage of our women grow and sell agricultural and value-added products at local markets that have been closed for an extended period of time. Although many of them have found alternative ways to sell their products, we know there are likely to be losses.
We are buoyed by the knowledge that the loan program is crucial to our borrowers and they take their responsibility to repay their loans very seriously. We also want to keep our borrowers in business; we do not want to default their loans and so will work with each of them individually to restructure the loans by extending the term or wrapping the balance due into a new loan, under the advisement of our local loan coordinators. We think the most constructive scenario likely will be increasing an outstanding loan, so the borrower has the working capital to replace lost inventory, plant new crops or acquire depleted raw materials to start-up operations again. In some cases, the situation may be so egregious (watchmen in Uganda stealing women’s entire bean, onion, or tomato harvest) that loan forgiveness is the best alternative.
Unfortunately, we can only let this situation play out and see what the impact will be. WMI's local staff is monitoring the situation closely in each country. Where they can, our staff is proactive in finding solutions to problems. In our program in Buyobo, Uganda, for instance, the director arranged for the truck drivers to come to the village to pick up produce to take to the cities, rather than the ladies selling it locally in the market. Other businesses, especially in Kenya, must remain closed.
Because this situation will be with us for a while, we are creating a fund for Loan Restructuring and Forgiveness, and will it use to replenish the various loan funds, as necessary. We plan to fund this new priority at $25,000. If you are able, please consider making a donation now so that WMI will have the ability to get lending going again and assist our borrowers as soon as the sanctions are lifted. We’ve made tremendous progress in our effort to lift women and their families from poverty…you can help us to keep the trend going!
Thank you for your continuing support,
The Women of East Africa