| More about SDF: Presenting the "Success Brochure" that Kate has been working on for the past few weeks |
| THE GAMBIA SOCIAL DEVELOPMENT FUND SDF MICRO CREDIT SUCCESS STORIES FIGHTING POVERTY THROUGH THE PARTICIPATORY APPROACH |
| March 2002 |
 |
| SDF Founded in 1998, The Gambia Social Development Fund (SDF) was created to reduce poverty in The Gambia by increasing access to economic and social opportunities for the poor and vulnerable, especially women, youths and the handicapped. Furthering this mission, in 1999, SDF�s Micro Finance Unit began supporting Micro Finance Institutions (MFIs), Non-Governmental Organisations (NGOs) and Community Based Organisations (CBOs) engaged in savings mobilization and provision of credit to the poor and vulnerable in The Gambia. The main objectives of the Micro Finance Unit are: (a) To provide credit facilities to the grassroots poor in order to help them undertake income-generating ventures, thus assisting in employment creation; (b) To offer technical assistance, training and institutional development interventions so as to strengthen the capacities of the MFIs/CBOs/NGOs for savings mobilization and proper credit management. Following are stories of how access to SDF micro credit funds has affected the lives of some poor people in The Gambia: Association of Gambian Entrepreneurs (AGE) Greater Banjul Area (GBA) One of the NGOs that SDF works with is The Association of Gambian Entrepreneurs (AGE). Founded in 1987, AGE helps entrepreneurs by training them in business and management through advisory and consulting services, as well as holding seminars, workshops and study tours. AGE also provides access to credit for its members who would not otherwise be eligible for credit through more formal channels such as commercial banks. Between 1999 and 2001, AGE accessed micro credit funds from SDF for forward-lending to its members on three separate occasions. In 1999, 35 members borrowed D1,000 each, in 2000, 47 members each received a D1,000 loan, and in 2001, 44 members borrowed a total of D44,000. Following are the stories of Amie Ngum and Haddy John Hydara, two of AGE�s successful entrepreneurs: Amie Ngum Amie Ngum lives with her family at the Bakau Army barracks where her husband is the Army Imam (a job with no formal salary, paid solely by voluntary contributions). Amie was a housewife with an entrepreneurial spirit who saw an opportunity. She noticed that there was no place for military personal and their families to buy anything on the compound grounds. So she decided to open a shop. On a table outside the door of her house, she sold staples such as sugar, oil, onions and stock cubes. Through AGE, she received three loans of D1,000. Each time she was able to buy more inventory and sell a wider variety of items. In addition to food, she also used to sell material that had been tied and dyed by another woman. When she saw the profit opportunity in tie and dye, she decided to learn the skill herself. After being taught by a relative, Amie took some of her savings and bought materials and equipment for tie and dye and sewing projects. She now makes bed sheets, pillowcases, curtains, clothes and other items that she sells out of her home. |
| Amie attributes her success to hard work, product diversification and a good investment strategy. Her business is over 50% larger than when she started. Due to the success of her business, Amie has achieved greater status within her family, been able to take better care of her children and even save some money. Haddy John Hydara Haddy John Hydara began her career as a nurse, but after getting married her husband encouraged her to begin a more profitable career in petty trading. She got her start in 1965 selling items outdoors on a table under an umbrella at one of the busiest intersections in Bakau. She sold seasonal items such as umbrellas and raincoats during the rainy season, and clothing before the annual Tobaski festival when it is traditional to buy new clothes for ones family. Soon she expanded to fast food, snacks and other staple items. Her business provided enough money for her to educate all three of her children and keep them in good health. She and her husband were a great team. He would do the buying and she would do the selling. But in 1986 her husband died. She tried to continue the business without him in order to support her family, but found it very difficult to survive alone in the male-dominated business world. The men she did business with frequently took advantage of her. One day a friend told Haddy about AGE. She began going to meetings and getting more and more involved with the group. Between 1999 and 2001, Haddy received three SDF loans through AGE. She and six friends, who call themselves the �Extra Touch� group, formed what is locally called an �osusu� or a rotational financial support group. Group members lend each other money in times of need. Each member received a D1,000 loan from AGE and they pooled their resources. Haddy put the money to work by investing it in her business. With additional support from AGE, Haddy received training in food preparation. She learned how to make things such as pepper sauce, jam and pickles and how to process cereal. She began bottling and packaging the food she made and used her retail skills to sell the items at a margin of almost 45%. She now employs two assistants and her products are sold in many supermarkets. As a result of her success, she has been able to expand her business and build her own house and storage facility for her business. |
| SDF also makes micro credit available for rural entrepreneurs. Following are examples of several women who received micro credit through their local credit unions. Tambasansang Co-operative Credit Union Tambasansang, Tumana, URD The Tambasansang Co-operative Credit Union is a Community Based Organization (CBO) in the rural village of Tambasansang in the Tumana District of the Upper River Division (URD). Sixty-eight members (62 women and 6 men) borrowed amounts ranging from D200 to D1,000 for their individual income-generating businesses. One member of the group, Kuta Jawo received a loan of D300 and bought rice and onions to sell. With the profits she paid back the loan and bought a gallon of oil to sell. Another member, Koba Balisa, received a D1,000 loan. With the money, she purchased groundnuts from farmers at harvest time, and packaged and transported them to the groundnut cooperative for resale. At the end of the groundnut harvest, she took her profits and bought items such as oil, sugar and onions to sell to other people in the community. Kuta and Koba are both very pleased with the profits they made from these activities and were able to pay back their loans quickly. Both women proudly tell of how they have been able to solve many of their personal and family issues without asking others for help. The skills and lessons learned go far beyond petty trading and business. Since the loan was given to the group, they must all support each other in the repayment of their individual portions. This is not always easy. One member of the group took half the money from her loan and bought sugar, soap and stock cubes to sell. She gave the other half of the money to her brother for his business. Her petty trading was successful and she was able to repay half of the loan, but has been unable to recover the money she lent to her brother. The other members of the group are encouraging her and supporting her in repaying the loan as soon as possible, but they have all learned to be more careful with their money. Beyond the individual members, there were also benefits for the group as a whole. The Tambasansang Co-operative Credit Union was able to meet the financial requirements and make the required deposits at the Central Finance Facility (CFF) of NACCUG, the credit union�s umbrella organisation. This means that CFF will soon be recognized by the Central Bank of The Gambia as a non-bank financial institution and all credit unions in The Gambia will be able to participate in a wider spectrum of micro-credit programs. |
| Sare Sankuleh Credit Union Sare Sankuleh, Jimara, URD The Sare Sankuleh Credit Union received a micro credit loan in 2002 for the women�s group Jokereh Endam Kafo. Fifty-five group members borrowed between D50-D1,000 each for income-generating activities such as petty trading, livestock rearing and sewing. The Lady President of Jokereh Endam Kafo, Kumba Mballow, borrowed D1,000 to buy rice and oil in Basse to sell to members of her community. She also bought the raw materials to make soap to sell. Another member, Kadijatou Jallow borrowed D500 for her petty trading business. With the money, she bought sugar and rice. As her profits grew, she has expanded her product selection to include other items such as oil, stock cubes and batteries. These businesses have benefited Kumba and Kadijatou personally, as they have been able to buy clothes, food and medicines for their families. It has also been of benefit to the community since they are over 15 kilometres from Basse and many people cannot travel to a central market place. |
| SDF�s Small Enterprise Development (SED) Credit Scheme There are limitations to SDF�s individual loan scheme and that is one reason why SDF created the Small Enterprise Development (SED) Credit Scheme. The individual loan programme is designed in such a way that only MFIs which are recognized as Non-Bank Financial Institutions (NBFI) with the Central Bank of The Gambia can access micro credit funds directly from the SDF. All other institutions and groups have to channel their loan applications through Central Bank recognized NBFIs. The Small Enterprise Development (SED) Credit Scheme was created in order to provide more direct access to micro credit for legally recognized organizations running micro, small and medium enterprises that are of an income-generating nature. The forward-lenders participating in the SED Credit Scheme must be an organization licensed or certificated by the Central Bank of the Gambia -OR- an umbrella CBO or a reputable NGO running micro-finance in the country. All end-borrowers must be groups involved in well-defined income-generating activities that will help enhance the development of micro, small and medium enterprises and have well defined business and marketing plans. Following are some examples of micro, small and medium enterprises that received SDF�s Small Enterprise Development (SED) Credit Scheme loans through AFET, the Association of Farmers, Educators and Traders: AFET, Association of Farmers, Educators and Traders Brikama (WD) The Association of Farmers Educators and Traders (AFET) is a local Gambian NGO that was formed in 1988. AFET�s main objective is to alleviate poverty. It works to do so by assisting communities to help themselves through activities such as communal vegetable gardens and literacy classes and encouraging income-generating activities, and by providing access to credit and savings opportunities. AFET has nineteen offices and 170 member groups with membership totalling almost seventeen thousand. Allatentu Kafo Brikama, Misira Allatentu Kafo began in 1990 as a group of women who were all involved in farming. Over 95% of the group�s members are illiterate. They knew they were powerless if isolated, so they formed a group. The group then joined AFET who provided the members with training in various skills including soap making, tie and dye and food processing. In 2001, 24 Allatentu members took out a D10,000 loan through AFET as working capital for their income generating businesses. Together they invested in their soap making, tie and dye and food processing activities to raise money for the group and enable the members to learn new skills. |
| The group focuses on producing quality products made from local materials that can market themselves such as soap, pepper sauce, mango and papaya jam, and tie and dye fabrics. On days that are designated for group activities, products are made by the group collectively and then sold by the individual members. Each woman receives a 10% commission for everything she sells. Many of the products are sold for very high margins. For example, pepper sauce and soap can be sold for 100% and 50% profit respectively. As a result of activities made possible by the SDF-AFET loan, the group currently has D9,000 savings in the bank plus other assets and money invested in inventory. Members meet twice a year to decide how much money should be divided among the individuals and how much should be reinvested in the business. As members of the group, they all have specialized skills. But they share those skills and teach each other. Then on the days that are not designated for group activities, each member can make her own soap or pepper sauce or papaya jam for her own personal use or to sell. |
| Aji Haddy Silva has been a member since the beginning. She joined the group so that she could help herself and her family. She has learned all of the skills that the group teaches and has profited tremendously. Before she joined the group, she used to work alone selling things in the market. Her business is much stronger now that she has the group�s products to sell. With the money she has earned, she has been able to pay for many family necessities such as school fees for her children. She has also been able to purchase many things for the household. Although Haddy has only 9 children of her own, her husband has over 30 children from his many marriages. She proudly reports that since she began helping to support the family, her husband has involved her in making many family decisions. The members of Allatentu Kafo have big dreams for the future. They know that they can get much higher prices for their food products when the ingredients are out of season (i.e. customers will pay more for mango jam when there are no mangoes in the market), but they do not have anywhere to keep the products. The group hopes to find a suitable storage facility and save enough money to have the working capital so that they can keep the products and sell them in the off-season. Fiberglass Association Brikama, Misira The Fiberglass Association of Brikama is another CBO affiliated with AFET that took advantage of the SED Credit Scheme. Group members had over 10 years of experience, but lacked start-up capital. In 2001, 27 members collectively took out a loan of D10,000 to buy raw materials. With enough working capital, the group was able to order materials at wholesale prices from BASF in Germany, rather than buy them on an as need basis at high prices across the boarder in Senegal. Although the group lacks a permanent production centre, the group works in the yard of a member�s compound making fiberglass boats, water tanks, tables and chairs. They now sell their products in The Gambia and many surrounding West African countries such as Guinea Bissau and Senegal. |
| Since 1999, The Gambian Social Development Fund (SDF) has lent over D4 million Gambian dalasis (US$210,526) to over 175 groups with more than 11,000 individual beneficiaries. Each beneficiary received a loan between D50 (US$2.63) and D1,000 (US$52.63). Over 72% of the loan recipients were women. To date the micro credit program has achieved a 96% loan repayment rate. |
| FOR MORE INFORMATION Contact the Divisional Programme Office in your area: GBA Bakau Newtown WD Brikama NBD Kerewan CRD Janjanbureh (Georgetown) LRD Soma (Area Counsel) URD Basse (Mansajang) Or contact the Social Development Fund�s Central Office: SDF 17 Garba Jahumpa Road Bakau New Town P.O. Box 1895 Banjul The Gambia Tel: +(220) 494332/329/310 Fax: +(220) 494331 e-mail: [email protected] |
 |
 |
 |
 |
 |
 |
 |