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Alto, a 50-year-old Ugandan, had not been able
to borrow any money anywhere until he received a
£60 loan from Cerudeb, the Centenary Rural
Development Bank. With this, and £60 from his
own savings, he bought a sewing machine. He uses
his machine to repair shoes and make new ones. In
nine months, his income has risen from
£1-£2 a day to £3.
Cerudeb
lends to about 80,000 tiny enterprises run by poor
Ugandans. Triodos Bank, supported by savers in
Britain and the Low Countries, provides finance for
Cerudeb.
The name Triodos comes from the Greek and
reflects the bank’s aim of achieving threefold
benefits &endash; cultural, social and economic
&endash; through its activities. It was established
in 1980 in the Netherlands and opened an office in
the United Kingdom in 1995. It invests in socially
useful enterprises while still paying savers a
competitive rate of interest on their money.
These enterprises include ‘banks for the poor’
overseas such as Cerudeb (see above), Agashani
Credit and The Start-Up Fund in South Africa,
FACACH in Honduras, Asociation Andar in Costa Rica.
There are also coffee growers groups in Tanzania
and a Peruvian organisation, Allpa, which finances
and buys goods for export from small-scale
producers. The criteria on which the bank decides
which organisations to back include how well
administered they are and whether they attract
local savings. Bank staff visit borrowers before
investing in them and make further visits every
year.
The aim is that borrowers should become strong
enough to attract commercial investment and become
banks in their own right. The Kenya Rural
Enterprise Programme, founded in 1984, has raised
£5 million in share capital and become the
first microcredit bank in Kenya.
In Britain, the Triodos Bank’s North.South Plan
has raised £5 million specifically to finance
microcredit lending in developing countries. It is
the first UK savings bank account to do this.
Interest rates for savers range from 3 per cent
on £300 withdrawable at 33 days’ notice to
5.75 per cent on £100,000 at 90 days’ notice.
Savers can, if they wish, give their interest to
fund training and help for borrowers.
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