Tate and Lyle Award for Sustainable Development
The Winner: Richards Bay Minerals
Put three shipping containers at a bus-and-taxi rank where Zulu women and others sell fruit, food and secondhand clothes, and you have an Achib pavement bank, able to make small loans to the sellers and provide overnight storage for their goods.
The bank manager at Empangeni, South Africa, is 41-year-old Nester Mcanyana, former teacher and small trader, mother of six children. She helps, encourages and makes loans from 50 to a maximum of 1,000 rand(£7.50 to £150) to 450 or more hawkers and vendors who sell to thousands of rural and urban commuters coming in to work, shop or see a doctor. Vendors earn 350 to 1,200 rand a month, depending on their product, experience and ability.
Nester has a loan fund of 10,000 rand (£1,500), and she charges interest at 1 per cent per day, which pays the overhead costs including her wage of 2,500 rand (£375) a month. Most loans are repaid in ten days. Setting up the bank cost £3,000, put up by Richards Bay Minerals, an RTZ-CRA subsidiary which extracts minerals from Natal's coastal dunes for paintmaking, glazes and iron.
African small traders find it hard to borrow from conventional banks. They have no business address, no street address, no security, not much English, and the nearest bank branch could be a distance away. They can borrow only from moneylenders charging 100 per cent a month.
The simple, hassle-free Achib alternative has been pioneered by Peter Morrison of RBM's Business Advice Centre and Lawrence Mavundia of Achib (the African Council for Hawkers and Informal Business). They saw small loans without paperwork as a means of helping traders to increase turnover and improve their incomes.
A committee of vendors vets applicants to join the bank. They must be known to other vendors and have been trading for two years. New members pay 25 rand (£4) for an identity-and-membership card on which they can borrow 50 rand immediately. Once they have repaid five loans of 50 rand, they can move up to 100 rand. Their membership card also entitles them to buy goods from wholesalers, who normally serve large customers only.
Since the Empangeni bank opened in 1994, it has not needed to write any loans off. Nester Mcanyana gets in touch with slow payers, who may need business advice or may be coping with a sick child. Nester and her clients see the bank as 'their' bank.
The old white-dominated government had laws against small business, and vendors were continually being prosecuted for illegal trading. Achib was formed in 1986 to fight for the right to trade on pavements. RBM's Business Advice Centre, set up in Empangeni the same year, has provided traders with stalls, offered training, and helped in talks with the local council to prevent prosecutions.
There are now six other Achib banks, sponsored by companies or provincial government, in Johannesburg, Kimberley, Klerksdorp/Rustenburg, Kroonstad, Nelspruit and Uitenhage. South Africa's Department of Trade and Industry is considering an annual grant, to extend the network. Foreign and local donor organisations also want to get involved.