World Vision® is delighted to send you our Executive Briefing for Economic Empowerment. You are an integral part of our work to end extreme poverty by 2030, so we want to keep you updated on our progress! If you are new to our work, please take a moment to learn about our THRIVE model and how it's helping to break the cycle of poverty and sustainably improve family's education, health, food security and nutrition, and shelter.
On June 27th the world marks Micro, Small and Medium-sized Enterprises Day. As most of the people World Vision serves run their own small business or farm, and since it is a service critical to supporting these businesses’ growth, we are focusing this issue on our ministry of microfinance. While our main focus in microfinance is Recovery Lending for those affected by the economic fall-out of COVID-19, read on to discover about our rather startling breakthroughs in lending to refugees, something many thought could not possibly work. Lessons learned from serving refugees is informing our work globally.
Providing Loans to the World's Most Vulnerable Clients
According toUNHCR, 82.4 million people around the world were displaced from their homes in 2020 as a result of persecution, conflict, violence, human rights violations or events seriously disturbing public order. A significant percentage of these people, 48 million, were internally displaced people (IDPs) and 26.4 million were refugees - half of whom are children.
June 20th was World Refugee Day. A day to honor refugees and IDPs; acknowledging the hurdles they have faced, and the journeys they have taken to protect their families.
Just a week after we reflect on the lives and status of people who have had to flee their homes, the world celebrates Micro, Small, and Medium-Sized Enterprise Day (June 27th). Micro, Small, and Medium-Sized Enterprise Day calls attention to small business owners who overcome the many hurdles of planting new businesses and growing them into a successful enterprises.
At World Vision and VisionFund®, we celebrate these days in unison as we support IDP and refugee communities find economic stability in the aftermath of displacement. In fact, we have found that IDPs and refugees are often tenacious business owners who are eager to build a more stable and prosperous life for their families.
Financial Services for Refugee Communities
*Below excerpts taken from Martina Crailsheim's blog post, Lending to refugees: How impossible becomes possible. Martina Crailsheim is the Director for Saving Group Linkage at VisionFund International. Her full blog can be found here.
"Traditional" microfinance theory is that one should only work with people in stable communities. We decided to test that theory, and VisionFund has recently piloted two products specifically designed for refugee communities in two very difficult contexts, that responded to two very different sets of client needs. The first product was tested with clients in Uganda.
In Uganda, with a fully automated process for client registration and the use of mobile money for transactions, the Saving Group Linkage Loan extends microcredit into already formed Savings Groups. Currently, VisionFund Uganda serves over 19,000 clients in 700 savings groups from established Ugandan (host) and new refugee communities, with a loan portfolio in excess of $400,000 and a remarkable repayment rate of about 96%.
76% of these clients are women and more than 50,000 children have positively benefitted across Uganda's West Nile region. Additionally, VisionFund Uganda invested a lot in financial literacy to equip the refugees with basic financial knowledge including record-keeping, financial management, managing their loan repayment and entrenching the culture of savings. This, in addition to VisionFund’s Recovery Lending for Resilience initiatives.
These findings are phenomenal and have encouraged VisionFund and World Vision to continue serving the most vulnerable communities by helping people rebuild their lives as micro and small business owners.
Please read the rest of Martina's blog post in order to learn more about the second product targeting refugee communities. If you would like to engage supporting Saving Group Linkage Loans, please talk to your World Vision Representative.
Tailor-Made Hopes and Dreams
For the many that escaped civil war in South Sudan and embarked on the uncertain passage to Uganda, the challenges are numerous. For Annette (44), who has a disability which makes it difficult for her to walk, the journey was twice as hard.
In Kajokeji, South Sudan, Annette worked as a tailor. She was a widow with five children to provide for. When the war broke out and everyone around her started to leave their homes, she was unable to walk the two-day journey to Uganda as many others did. Instead, she used her savings to pay 100,000 SSP (USD $770) for a truck to transport her family a part of the way. She recalls making the journey in January 2017: making sure her five children and mother were not separated, and having to sleep in the bush. She remembers people fighting for water.
The family had not been able to bring much, but Annette had managed to bring her sewing machine. She started making baby clothes, building herself a small make-do shop space. She now sews school uniforms for children in the refugee camp and women's dresses from the bright cloth that she purchases from town.
She was part of a savings group in the refugee camp, where the group members pool their savings and makes small loans within the group to ensure each member is provided for. The savings group obtained Savings Group Linkage Loan from VisionFund in an exciting new pilot project, to expand the savings group's pool of available funds and further enhance the borrowing opportunities for refugee and host families in Uganda.This allowed Annette to take a larger loan than what the group usually offered, and she used this loan to purchase cloth for her business and pay for transport to town.
Micro-Loan Empowers Young Migrant Dentist to Rekindle His Practice in New Country
Rubén Diaz was just 27 when he had to uproot his life in Venezuela and start over as a foreigner in Peru. Five years after graduating college and earning his dentist license, he had finally hit his stride running his own dental practice in Apure state, in western Venezuela. It was exactly what he had dreamed of.
But the political and economic crisis in his home country became too much to bear. Like so many others, he tried to make it work. But businesses closed, public services stopped, clients could no longer afford his services, and even basic sustenance became scarce for him and his family.
So in 2018, he migrated to Peru to find economic stability and a way to support his struggling parents and extended family back in Venezuela.
"It was quite a difficult process to leave my family, my job and my friends to find myself in a totally new country,” says Rubén, now 30, living in Lima, Peru’s capital.
Rubén is one of more than 5.6 million people who have left Venezuela since 2014. Most, like him, have settled in South America, including more than 1.7 million in Colombia, more than 1 million in Peru, 457,000 in Chile and 431,000 in Ecuador. The migration crisis has been exacerbated by the COVID-19 pandemic, which has strained host communities nearly to their breaking point.
Rubén’s experience of landing in a new country could have been much worse. But a World Vision and USAID program providing financial and legal assistance gave him just the support he needed to find his footing in his new home.
The program is funded by a grant from USAID and is implemented through World Vision’s micro-finance agency, VisionFund (in Peru, it’s called CrediVision). In its first phase, the grant provided financial assistance for Venezuelan immigrants who came with previous certification in the medical field. The financial assistance was free and came with guidance and assistance for the legal and educational aspects of their re-licensing process.
The second phase of the program branched out to people like Rubén in other professions. In addition to the help navigating the licensing process, the program provided loans, or credit which enabled them to pay all the up-front costs of registration, tuition, exams and other fees and requirements. He received a loan of about $450 and will repay it over the 12 months since receiving the loan. The repayment model allows the program to sustain itself and support other professionals in the same way, as long as the need is there.
“After two and a half years without doing almost any of this, it is quite exciting,” Rubén says. “I am already feeling quite calm because I can work professionally, and I can achieve both personal goals here and also be able to support my family in Venezuela.”
Rubén credits his parents for supporting him through his education and professional development. And he credits World Vision with providing the second chance he needed to pursue his dream and find the stability he sought when he left Venezuela.
As faithful readers of this newsletter will know, building improved and resilient livelihoods for smallholder farmers involves the natural resource management systems of farming. World Vision has just made an exciting announcement: World Vision is now an official supporting partner of the United Nations Decade on Ecosystem Restoration. This is a mouthful, but see the attached article from one of our smallholder farmers in Honduras to understand this more.
Coming in July!
Our THRIVE Tanzania end-of-program report is nearly done. We have very exciting news to share. Allow us to whet your appetite with 3 snippets from the report:
Income growth of 10 x;
The income difference between the THRIVE farmers and the “control group” over the last 4 years totaled $14.5 million;
The THRIVE farmers were resilient to COVID-19’s economic impacts, with 94.5% able to cope without resorting to selling off land, equipment, or productive animals.
Mark Your Calendars
Coffee with Chris: Our monthly coffee chat with Chris Shore open to all donors. No agenda, so feel free to bring any questions you might have about Economic Empowerment | Wednesday, July 7 at 8 a.m. PT Join Here
Economic Empowerment Forum: Join us on September 16 and 17 for our EE Forum! Get the latest updates on our Economic Empowerment work including reviews on THRIVE, Recovery Lending for Resilience, Empowered Worldview and what the future of Economic Empowerment looks like | September 16 & 17 2021
Praises and Prayer Requests
PRAISE
Praise that the refugee savings groups that have received linkage loans have been successful in increasing their economic resilience.
Praise for the innovation and creativity of our clients as they grow their businesses and build micro, small and medium-sized enterprises.
Praise that we have a community of compassionate, globally-conscious, donors who see the needs and hear the calls of refugee and IDP communities around the world.
PRAYER
Pray for the millions of refugees and IDPs navigating displacement. Pray for their safety, stability, and family well-being. Pray that they gain access to financial services to help them grow thriving businesses that enable them to provide for their children.
Praythat VisionFund and World Vision are able to increase the scale at which we serve displaced groups of people through our economic empowerment programs.
World Vision is a Christian humanitarian organization dedicated to working with children, families, and their communities worldwide to reach their full potential by tackling the causes of poverty and injustice.
In 2017, 85 percent of World Vision's total operating expenses were used for programs that benefit children, families, and communities in need. Learn More.
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