Small support fund – Malawi
In Malawi, many youth struggle to find capital to start a business and during some times of the year they struggle to provide for their basic needs. A small boost can create opportunities and help them buy food for their families and start a small business. The fund lends a small amount of money to people in Malawi which is manageable to pay back. It helps cover for emergencies and it motivates to start or boost a business and make it profitable so that they can pay it back. In groups of 5 people, each group member takes a small loan and every month they pay a small interest fee.
We are currently in a pilot phase where 50 people have received a small loan. The fund is collectively managed, with the community itself partly responsible for determining interest rates, repayment terms and fund management. The groups help to motivate each group member to pay back. The interest rate collected covers for bank fees, administration costs and creates new loans. We are monitoring the progress to develop the best concept.