The nights are getting even shorter now and the weather is growing colder. Birds have fled south and the bears’ final foraging for food before hibernation is taking place. The dark of winter is nearly upon us. But we have been here before and we know the story. Soon a star will appear, and angels will blaze with light and sing glory to God to humble shepherds – not too dissimilar to the smallholder farmers and agro-pastoralists whom we serve. And so, while mindful of pandemic issues, we will soon be shopping and gifting and gathering – and celebrating again glad tidings of great joy!
We are also celebrating the role that we have been able to play in responding to the economic crisis facing the people we serve because of the economic impacts of COVID-19. Through our microfinance subsidiary, VisionFund® International, we were able to adapt an economic recovery tool that we have used when responding to other disasters for use during this global crisis. VisionFund has provided critically needed working capital loans so that shuttered businesses can reopen. We call this program Recovery Lending for Resilience, and we have deployed it in all 28 countries where VisionFund works.
This newsletter lays out the results of our Recovery Lending for Resilience work of the last 12 months. You’ll meet clients from three continents. While we celebrate the great things that have been done, there is much more that we want to do. There are so many more people who want and need a hand up so they can get back to business and provide for themselves – a recovery loan. Thank you for walking this road with us!
End of Year Recovery Lending for Resilience Results
We thank God for the generous donors who have helped us raise more than $16 million for Recovery Lending for Resilience, enabling VisionFund to provide more than 536,265 Recovery Loans to small business owners and savings groups* across 14 countries since July 2020. These loans have benefitted over 416,526 women and impacting over 1,422,343 children, just like Precious in Ghana. Please watch Precious share what a Recovery Loan means to her and her family here.
Recovery Loans are just one of of Recovery Lending for Resilience's four components.
*FAST: Finance Accelerating Savings Group Transformation
As farms and businesses struggle during the pandemic, many savings group members have drawn down their savings to pay for daily essentials. This has the unintended effect of stopping a savings group from being able to offer its members loans from the pool of savings.
In order to help support savings groups and their members, VisionFund has launched FAST: Finance Accelerating Savings Group Transformation. FAST works to build financial resilience for savings group members by providing loans to the group as a whole, preserving the very positive group dynamics which are important for good investment decisions and repayments. FAST increases group savings and accelerates the economic growth of group members through additional capital group members can invest in their businesses. FAST unleashes a positive, virtuous cycle, since by incentivizing even more savings, there is still more money in the group’s lending pool, which further accelerates group members taking loans to take advantage of good economic opportunities.
At the end of Fiscal Year 2021, VisionFund was serving over 3,500 savings groups across seven countries with FAST loans . Women account for 77% of FAST clients. To date, FAST has benefited over 240,000 children.
World Vision is planning to adopt FAST as a core component of our Economic Empowerment strategy in order to accelerate the economic transformation of the poorest and increase the number of rural women we're able to reach with financial services.
Empowered Worldview
VisionFund is committed to training all of our staff (7,000 people) and clients (more than 1,000,000 people) with Empowered Worldview Training. Once all the staff of a microfinance office have been trained, staff will begin training clients. Here are a few key Fiscal Year 2021 updates and plans for the coming year:
Ghana and Guatemala - Will finish staff training in Feb. 2022 and begin training clients
Kenya and Uganda - Staff training underway. Will start training clients later in 2022
Malawi and Rwanda - In process of hiring Transformation Impact Managers to to train staff during 2022
Senior VFI leadership has been trained in EWV
Honduras, Mexico, Mali and Senegal - plan to hire Transformation Impact Managers in 2022
VisionFund’s 15 microfinance institutions that are not in the first group of Empowered Worldview (EWV) adopters will rollout the VisionFund Mission Immersion Programme (MIP) to all of their staff
In Fiscal Year 2021, we adapted and piloted MIP for VisionFund, including a session on “Microfinance and Transformational Development” focused on EWV
Digitization
Digitization – including eliminating paper and delivering funds electronically - enables VisionFund to increase our ability to serve rural clients and improve our organizational efficiency. Through Recovery Lending for Resilience, we have been able to invest in mobile money (money delivered through a phone), core banking systems, improved accounting systems, and digital field applications (such as gathering client information electronically, which reduces the cost and time involved in gathering client data). Digitization is now underway in 11 countries in Africa and Latin America.
A Gift that Multiplies!
Each gift made to Recovery Lending for Resilience is immediately multiplied 2.75x as the gift is leveraged to borrow from institutional lenders. Additionally, as our clients repay their loans, we're able to re-lend the gift to new clients for years to come.
A $10,000 donation has the immediate impact of $27,500, which makes 62 loans. Over 10 years a $10,000 gift will provide more than 700 loans valued at $325,000, impacting more than 2,200 children.
Thanks to this ability to leverage and multiply a gift year over year, VisionFund has been able to provide $9.3 billion through more than 17 million loans over the last 17 years.
A Recovery Loan to a Nurse Saving Lives During COVID
Recovery Loans may be given to an individual client or savings group (through FAST), but they can often have a community effect. One such story like this comes from VisionFund Myanmar (VFM).
Daw Khin Phyu Phyu Thet, a wife and mother of three children, has been a VFM client for two years. She runs her own business as a qualified nurse and registered midwife managing pharmacy and health-care services in Hmawbi on the outskirts of Yangon.
In July when the infection rate was very high, Phyu Phyu managed her clinic in line with COVID-19 prevention guidelines to safely help patients both in-person and via telemedicine in the case of travel restrictions.
As an essential health-care service provider for her community, especially for women and children, she decided to keep running her clinic and pharmacy in spite of the many challenges in Myanmar this year.
The most challenging issue for health care businesses was the limited availability of medicine and medical supplies. Phyu Phyu was able to mitigate this problem by taking a loan from VFM, which allowed her to stock up on necessary medicines and supplies before market shortages and price increases made serving her clients impossible.
As a result, her clinic and pharmacy continues to service nearly 100 people a day. While some clinics and health-care services shut down due to shortage of supplies, Phyu Phyu was able to continue offering health-care services to her community throughout the height of the pandemic.
Newsflash!
World Vision’s overall plan for Recovery Lending for Resilience was to raise $55 million in donations, and to raise $100 million in debt. VisionFund has just received its first significant tranche of low-cost debt funds, and we hope to close a total of over $25 million by the end of the 2021. In addition, VisionFund has clear lines of sight on significantly more low-cost debt funds over the next 18 months.
Hear from Two VisonFund Clients in the Dominican Republic
Tito Javier received a Recovery Loan from VisionFund Dominican Republic to help him restart his business after COVID-19 hardships.Tito says, "With VisionFund, of course, there was a before and after." Watch here to learn more about Tito's "after."
Rubi Medina is a VisionFund Dominican Republic client who has transformed from a timid first-time client to a proud business owner who is sharing her knowledge with other women in her community. Watch here to learn about Rubi's journey as an entrepreneur and her vision for the future.
Praises and Prayer Requests
PRAISE
Praise for the remarkable impact Recovery Lending for Resilience is having on the communities we serve
Praise for all the donors and partners who have committed to helping us provide the financial services necessary to keep our clients from falling back into poverty due to COVID-19
PRAYER
Pray for wisdom for the team creating the World Vision Economic Empowerment Business Plan
Pray that we can continue to mobilize the necessary funds to continue serving our clients through the COVID-19 emergency