Microfinance Brigades follows the holistic model and enters a community based on thefinancial need information that the Community Research and Evaluation Program has collected and the decision made by the organization’s programs- following Water Brigades and simultaneously with Public Health brigades. The baseline data survey from R&E evaluates a community’s access to financial services with savings and loans, employment, and average income and expenditures.
Based on the information that R&E has gathered and the previous experience in communities with other brigade programs, the Microfinance Brigades program is working to address the issue that in most rural farming communities there is no access to financial services such as savings and loans. This has caused farmers to be dependent upon intermediaries who take advantage of them by charging high interest rates on loans and offer a very low price for the crops, which the communities produce. As a result, most community members have been trapped in a cycle of debt or are just able to make enough money to feed their families and purchase necessities. They have been unable to plan for the future in terms of saving for emergencies, education, home repairs, or to reach any other financial goals. Therefore, Microfinance Brigades is working to address these issues by providing rural communities with a strong financial system with access to loans, savings accounts, and capital to fund community projects and education initiatives, resulting in a culture of community empowerment and financial literacy.
The MFB program must establish a community bank following Water Brigades and prior to the starting of Public Health Brigades projects. Since the families who receive PHB projects are required to pay 15-20% of the projects, the community bank offers 3% interest rate loans to families who cannot pay the quantity at the time of receiving their projects and also administrates the money for families who can pay at one time. To begin the training, the MFB team seeks out a minimum of 10 leaders to conduct the training on the community-banking shareholder model and helps them to establish an executive board, auditing committee, credit committee, create their books and a Public Health projects account, and begin paying initial shares and starting the lending process.
Once a community bank is fully trained, they are able to begin receiving brigades. The program staff prepares the community bank by requesting them to prepare various activities for brigades. This year, the program will be meeting families selected by the community bank members who will be receiving groups on house visits and creating profiles to send to the students before the brigade. Following a brigade, the program team will meet with the community bank to discuss the financial literacy workshops, consultations with families, and CIF allocation. For the delivery of CIF, the MFB team creates an agreement along with an investment plan that the community bank president and treasurer must sign. At the end of each year, the program revisits the agreements to ensure that the allocation was utilized properly and that the money is reinvested into other projects in the community. Ideally, the program technician visits each community bank every 1-2 weeks to do follow-up and provides assistance for ongoing projects or investments being made. As community banks grow and become more self-sustaining, the program can withdraw brigades and lessen the follow-up to every 2-4 weeks, 2-3 months, 6 months, etc. The main goals of the program within the community is to not only establish a community bank with access to savings and loans but to train the members and executive board to be able to assist in the facilitation of other social projects in the community such as electricity, health initiatives, home repairs, etc. Beyond the services of savings and loans, the community banks also own agriculture businesses, which directly capitalize the banks and now microbusinesses, which are separate entities but supported by the banks. The community bank essentially becomes a final sustaining resource in the community that completes the Global Brigades holistic model and allows the programs to eventually sustainability transition out of a community.
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