MicroLoan Foundation launches in Zimbabwe

MicroLoan Foundation is proud to announce that we have opened up our first branches in Zimbabwe and our first clients have taken part in training and received their first loans to start up their businesses.

Why Zimbabwe?

Zimbabwe is one of the poorest countries in the world, ranked 156 out of 187 countries in the UN Development Programme’s Human Development Index for 2014. 72% of the population in Zimbabwe lives in poverty meaning they are lacking access to food, healthcare and education. As a result, one in three children suffers from stunted growth due to chronic malnutrition.

Three quarters of the poor live in rural areas. Poverty in rural areas is not just more common, but also more severe. As a result of poverty and ever-increasing unemployment, Zimbabwe has experienced a rise in male migration from rural areas. Households headed by women are increasingly frequent, and these households are nearly always the most disadvantaged and display the highest prevalence of poverty.

Unemployment in Zimbabwe is high and the employment opportunities that do exist are often informal. Most of the rural population has no access to financial services. With our support, rural women can set up enterprises that will generate income to support their family and ensure financial security, and provide employment opportunities for the community.

How can MicroLoan Foundation help?

MicroLoan Foundation works with women in rural areas because of the very factors listed above. Rates of poverty are typically much higher in rural areas than urban, as displayed in Zimbabwe, and women are hardest hit, making up 70% of the world’s poor. In Zimbabwe, there are many barriers for women such as, culture and tradition, the need to take care of others, and restricted access to finance. Access to financial services is very limited, with most of the women MicroLoan will be working with being unbanked.

How will it work?

The group model that has proved successful in Malawi and Zambia will be used, although the groups will be smaller – 5 women not 15 women in each group. MicroLoan Zimbabwe will also be operating using mobile money through the EcoCash platform.

The head office is based in Harare, and the first two loan centres, Molife and Pote, are just north of there. So far, there are two Loan & Training Officers and 35 clients. The first loan disbursement has taken place and the first repayments have been made in full. In order to ensure that the clients receive the support they need to succeed, MicroLoan Zimbabwe plans to grow relatively slowly to support some 7000 women by 2021.