Professional Documents
Culture Documents
II survivors in Europe. Its mission is to assist impoverished and disadvantaged people overseas, working in the spirit of Catholic Social Teaching to promote the sacredness of human life and the dignity of the human person. Catholic Relief Services approaches emergency relief and long-term development holistically, ensuring that all people, especially the poorest and most vulnerable, are able to participate in the very fullness of life to have access to basic necessities, health care and education all within peaceful, just communities. To achieve this, it focuses on six key areas of service: emergencies, hunger, education, health, peace and helping at home. Since 1988, Catholic Relief Services' microfinance program has been reaching the world's poorest communities with access to financial services that are sustainable over time. CRS' microfinance program is committed to serving the very poor, especially women and vulnerable populations in remote rural communities. CRS' programs target the selfemployed poor who have little or no access to formal credit or savings services.
Promotion of Self-help Groups Gram Vikas supports the formation and strengthening of Self-Help Groups (SHG). These groups can collectively accrue savings to fund income-generating activities such as agriculture, livestock rearing, fish farming and horticulture. A typical SHG is comprised of 10 to 15 members of the community who agree to deposit monthly savings into a fund, a portion of which can eventually be borrowed to fund community businesses. To support SHGs Gram Vikas provides basic record keeping and financial training and encourages the group to undertake income-generating activities. When the group gains the ability and confidence required to successfully manage their funds, they are linked to local banks. By linking them to local banks they are able to access external funds and government loans. Although SHGs are not restricted to beingexclusively for women, although majority of them are women's groups. The groups provide a social space for women to discuss common concerns in addition to wider issues. Additionally, this space enables women to develop the confidence that they need to speak out even when men are present. In a village council meeting, this allows women to play a greater role in the decision-making process.
Microfinance
Programs
Serve the poorest clients-Reflecting CRS goal to promote social and economic justice, we focus on the poorest communities and entrepreneurs. Women make up the majority of our clients, as they generally have the least means and access to credit. Link loans to savings-We connect the size of a clients loan to the amount of that clients savings, to ensure that they are building wealth as they borrow. Use solidarity guarantees-Group-guaranteed loans replace collateral. Solidarity guarantees work by linking new loans to on-time repayment of past loans. A self-selected group of clients guarantee each others loans with the understanding that no one in the group will receive a new loan until each members previous loan is repaid. Practice participatory management Clients are directly involved in the management and administration of the services they receive, from voting on loan applications to collecting payments from other borrowers. In this way, CRS guarantees the inclusion of those most affected by these major decisions. Invest in scale and self-sufficiency Investing in research, design, staffing and training from the beginning of a program, and throughout later stages of growth is crucial to successfully moving a project from start-up to formalization. Achieving scale (i.e., reaching at least 5,000 clients per partner) advances our mission to serve the poor. We achieve self-sufficiency through efficient operations and by charging interest at market rates. Plan for permanence Prior to launching a new microfinance project, CRS plans the projects evolution into a sustainable resource for the poor. Permanence may include creating a formal financial institution, helping partners transform programs into specialized microfinance institutions or consolidating pilot activities into larger local entities.
CRS outreach through savings-led initiatives has seen significant growth. Savings by members of these groups increased 43% from 2006 to 2008, to $1.5 million (figure 1). Over the same period, participation grew to nearly 800,000 people. While India predominates in terms of deposits and membership, growth is being driven by expansion in Africa, which has gone from 2,700 to 69,000 members with $573,000 in deposits. CRS experience has shown that the savings-led model integrates well with projects that target people living with HIV/AIDS or their caregivers, orphans and vulnerable children, agroenterprises, water and sanitation programs, and education initiatives. We emphasize collaboration across program sectors to meet the range of community needs.
Microfinance institution development For people in urban and periurban communities, CRS partners provide much-needed access to credit services through microfinance institutions (MFIs). Loans typically begin at $40. The goal for these institutions is to create strong and autonomous financial bases to grow beyond the need for subsidies and the direct support of CRS or other external organizations. CRS has helped to build the capacity of many MFIs over the past 20 years, so that they may be able to develop and test new financial products and services for microentrepreneurs. This approach has been very effective in creating products that meet the financial needs of poor communities and has proven that poor families have the capacity to absorb capital and transform their businesses and livelihoods.
ervices.