A New System

The purpose of this program is to teach business, and potentially give out loans. Unemployment is very high here, and because there are so many people looking for work, the pay situations for those employed are not very good.   

Everyone is looking for ways to make more money, so a more profitable business means a lot to the people here.  However, the loan repayment rate for the program here in Uganda is around 75%, while the rates of the programs in Ghana and Peru are around 95%.  Because the program cannot really be sustainable at such a low rate, our first duty is to go out in the field and figure out what we can do to help. 

Deo is the programs greatest asset.  He is the loan collector, and he is the only one who knows what is going on here.  He knows the tricky routes of the jungle.  He’s knows the people who have the loans, and he knows which people are causing the program “headache,” as he says.  He speaks English so well, we’re all very impressed with him.  I don’t really know how this program would be managing without him. 

For the past week, we have been joining Deo in visiting some of the many people who have been granted loans.  Last week we visited a lot of people who had actually already paid back their loans in full, and are looking to receive second loans.  People like these are the best kind of people for our program, because they have already had success in their businesses, and have proved responsible in repaying their loans. 

It was very interesting as we rode around the jungle, stopping at various houses.  In a day, we would visit a loan pod (we give out loans to a group of people, so there is shared responsibility in repayment) or two.  Because we were visiting people who wanted second loans, we would usually first ask them some questions. 

What is your business?  What was your first loan used for?  Has your business been successful?  What problems have you faced?  What are you looking to do with the next loan?  What materials do you already have? 

The new system we are looking to implement involves verifying the answers they put on paper.  In the past, loans could be granted if the paperwork and records showed a good enough plan.  We are now adding to the process.  After we asked the questions, we would go and look at their various businesses to see what things they really have. 

The groups and businesses we’ve seen so far have been nice to visit, because they have all been pretty faithful in repaying the loans.  This week, we’re going to start going out to some of the delinquent pods.  I think that is where things will start getting really interesting.  It’s kind of an overwhelming task.  We don’t know much of what is going on out here.  There are a lot of outstanding loans, so there are a lot of people and businesses to visit and help.  Hopefully we figure out a way to get things turned around out here.