At a recent event, I asked a group of World Vision donors to identify which part or parts of our THRIVE model were unique — approaches to economic empowerment that only World Vision practices. How would you do with that question?
A. Biblical Empowered Worldview
B. Savings Groups
C. Market Knowledge and Access
D. Lending to Savings Groups /FAST (Finance Accelerating Savings Group Transformation)
If you said A and D, you would be correct! Both Biblical Empowered Worldview and Lending to Savings Groups /FAST are unique to World Vision’s model.
We are delighted that the number of FAST loans around the world is growing quickly. Thanks to partners like you, an important milestone has just been reached — 300,000 savings group members are now benefiting from a FAST loan.
We are also delighted that we have even more ways for donors to participate in FAST — more about that below.
We are moving … FAST!
Veronica's story
Click the image below to see a video of the exciting journey of Veronica as she first becomes a successful farming entrepreneur and then helps her community by becoming a FAST loan officer.
FAST loans are growing fast!
Lending to Savings Groups was born as World Vision’s response to a very desperate situation. Refugees from the conflict in South Sudan were permitted to start businesses and small farms in and around their refugee camps in northern Uganda, where World Vision helped them to create savings groups. The challenge: since savings groups formally close every year (often in December) and “share out” the accumulated savings and interest earned, when the group restarts (often in January) there is very little money saved and available to be lent to members for various business needs.
We learned that by lending to the group up to 50% of what they saved in the lending cycle just ended, we incentivize more savings and increase the cash available to the group for lending early in the annual lending cycle. The group can easily manage that infusion of cash, having just managed twice that amount a few weeks prior. That infusion of cash from the loan means that in January or February, when the group has not yet saved much money, the group can lend much more to its members than it could without the loan. We see that savings increase by 40% to 60%, and more members get bigger loans faster, which means more members are growing their farms and businesses, making more money, and providing well for their children.
When World Vision lends to a savings group, we call it a FAST (Finance Accelerating Savings Group Transformation) loan. The number of people around the world benefiting from FAST loans is now about 300,000. Because the initial FAST loan is roughly $1,000 for a group of 20 to 25 people, we have moved from microfinance to “nanofinance.” Loans this small are not only too small for banks to deal with, they are even too small for most microfinance institutions to consider. FAST provides us with a unique financial tool aimed precisely at those living in extreme poverty.
Savings groups are where people who are just beginning their journey out of extreme poverty go to access small loans to start a new business or take advantage of a business opportunity. As World Vision’s WASH program expands and women are freed from the burden of getting water, or as small children grow and mothers have some margin in their lives, they have time to contribute to the household economically. They join World Vision’s THRIVE program, where they are trained in the Biblical Empowered Worldview curriculum, and are encouraged to join a savings group.
When savings groups are first formed, about 80% of participants are women. Interestingly, it appears that when groups have more money to lend, there is more interest by men in joining the savings group. We are now seeing that more men are participating, and about 70% of the people accessing FAST loans are women.
FAST Starter Kits and new ways to participate in FAST
Since the outbreak of COVID-19, World Vision has been investing in the financial breakthrough of Lending to Savings Groups, or FAST. It had a huge impact, providing critical capital during that time of economic recovery. Because of its effectiveness, we incorporated FAST into our THRIVE 2030 business plan.
To invite donor partners into the true joy of participating, we created a “FAST Starter Kit”: A $25,000 “investment” which allows us to hire and pay the salary of a loan officer for a year, get that person a motorcycle (and training on how to use it), a tablet computer, and enough lending capital for 15 to18 groups. After about 12 months, we report back so the investing donor can meet a loan officer, read about the progress made, see the various groups and where they meet, and discover the impact FAST has made in the life of a micro-entrepreneur lifting themself out of extreme poverty.
*NEW* FAST Capital: This $15,000 “investment” provides the balance of the funding needed for the loan officer’s full 30-group portfolio. This stand-alone offer will support loan officers from the past 1+ years to fund the remaining groups needed for the loan officer to become financially self-sustainable.
Again, once the loan officer has fully deployed the lending capital to all 30 groups, the interest earned pays for all expenses, including salary, operations, and motorcycle depreciation! Find out more about FAST Capital here.
*NEW* FAST Forward Kit: This is the combination of the FAST Starter Kit and FAST Capital for the same loan officer, for a total of a $40,000 “investment.” This provides a new loan officer with a motorcycle, training, equipment, and capital for the first 15 to 18 loans, as well as the 15 additional loans to groups that will come after the Starter Kit is completed. You will receive two reports: One for the Starter Kit, provided about 12 months after the “investment”; and the second for the FAST Capital (15 groups), no later than nine months after the first report. Find out more about a FAST Forward Kit here.
*NEW* FAST Branch: This $240,000 “investment” supports a whole FAST system: Six loan officers, all the loan capital needed, one branch manager, one branch support person, and the branch office. You will receive two reports. The first report will be provided about 12 months after the gift is received, and the second will be provided up to nine months later. Amazingly, once the six loan officers have deployed all of their capital, the entire branch is sustainable, covering costs of all salaries and operations, forever! Here's more about a FAST Branch.
World Vision in the news
World Vision’s microfinance subsidiary, VisionFund International, is responding to the 7.7 magnitude earthquake in Myanmar with recovery lending. These are loans to existing clients to quickly recapitalize their businesses and rebuild their homes, allowing families to quickly get back on their feet and begin the long-term work of recovery. Click here to read the story.
Join us in prayer
Praise God for the strong impact of FAST loans in the lives of people around the world.
Pray for wisdom and guidance for World Vision as we respond to recent large emergencies, including the strong earthquake in Myanmar and the refugee crisis caused by severe conflict in Sudan.
Thank you for uniting with us in prayer and for your faithful partnership!
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