Ten years ago, humanitarian organization World Vision began a microfinance program called VisionFund to provide small loans to families living in poverty. To celebrate its ten-year anniversary, VisionFund announced today that it will begin a year-long initiative to profile its clients’ achievements.
One of whom is Genevieve. In 2003, Genevieve’s parents and her five siblings, who live in the northern island of the Philippines, had fallen into financial difficulties. Her dad was forced to work a lower-paying job due to ill health. Genevieve, who is the eldest daughter, was forced to drop out of school because her parents could not afford to send her to secondary school on the Philippines mainland.
Through a US$70 VisionFund loan, mother Davina started her own business exporting sea cucumbers to China. The business has grown to the point where she could afford to send all six children to school, including Genevieve who graduated and is now teaching primary school while she finishes her masters to be eligible to teach secondary school. Her pay as a teacher helps support the education of her brothers and sisters.
Since 2003, VisionFund has been managing a supply of lending capital that could be moved between countries to support World Vision’s humanitarian efforts. This global capital fund is a breakthrough for a charity – as the loans are repaid, the capital is used to provide a loan to another client. A reasonable interest rate is charged to cover the cost of running the program, making it self-sustaining.
“We believe it’s our unique partnership with World Vision which makes VisionFund’s work highly effective. I have seen first-hand the results of our integrated approach, where microfinance is one of many poverty interventions that creates lasting change for families and the wider community. Working with communities to build economic activities in a gradual and sustainable manner over a period of many years enables them to adjust and develop, resulting in longer lasting change,” said Scott Brown, CEO of VisionFund.
In the past, the microfinance sector came under scrutiny for unscrupulous activity and since then, major initiatives have been built to protect consumers and provide better financial services for the poor. More and more microfinance institutions such as VisionFund are participating in these initiatives. The Smart Campaign ensures microfinance clients and treated fairly and respectfully, MicroFinance Transparency focuses on making pricing transparent, the Social Performance Task Force aims to develop universal standards for social performance management and reporting, and the Progress out of Poverty Index ensures that microfinance institutions lend to the right target groups.
So far, VisionFund has provided 6.6 million loans valued at US$3.5 Billion. They currently help more than 800,000 small businesses in 36 countries worldwide.
Photo and source: VisionFund
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