Uganda, Africa
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Report Date: August 8, 2015
Key person: Anna Ocen
Loan Programme
We visited the Lira widows micro-loan programme on 29 and 30 June 2015. There has been a very impressive amount of growth and development in the existing programme which now has 36 beneficiaries who operate effectively in two groups, one centered in or around the town market and the other out near Hope Restoration Centre (UGA03a).
This loan programme is run by Dorcas and Penninah, Anna’s sister.
New Programme
Since we were last here Anna was one of the key speakers and attendees at a Women’s Conference at Kirombe Pentecostal Church which is in an area of town approximately 1.5 kilometres from Hope Restoration Centre. As a result of that connection a new micro-loan programme has started and is being looked after by two women, Mary Taaka and Grace Nam. This new micro-loan group has two subgroups, one with 14 people and one with 8. The new groups run on exactly the same processes as the existing loan programme and use the same loan books. The interest rate charged is the same as the existing programme, i.e. 3% per four month loan cycle – 12% per annum.
We were very excited to see the development and to meet both Mary and Grace (see their stories below). We also had the opportunity to meet and interact with a range of the new loan beneficiaries. Anna spoke very highly of Grace and described her as “the best in the whole group”. She trusts the leadership of the new group and says that it is working well and hard. She visits with them regularly to see that they are doing well, and verifies the finances. Anna can also see the changes in the loan beneficiaries whom she encounters.
Both loan programmes work on the basis that the loan beneficiaries cross guarantee each other, as well as a high degree of social, spiritual and practical support. The biggest hurdle and obstacle which they face in the programmes at this stage is from sickness although there are other issues outlined below.
It looks like the Kirombe Pentecostal Church may well be a useful connection into the future. It is presently a church without a Pastor as the previous one died under violent circumstances about 18 months ago. At the same time the church does appear to have a significant community focus and I was told by one of the Elders that it is presently supporting well over 200 orphans in various ways. It also has a school and daycare centre.
Grace Nam
Grace is one of the leaders of the women at the Kirombe Pentecostal Church. She has been sewing clothing, particularly for schools, for 10 years and has her own sewing machine. She started with the new loan programme in December 2014. Her first loan amount was UGX200,000 (US$70). Before she received the loan she described her family situation as being full of pressure. In her household there are six children and two orphans who rely on her for support. Before the loan was granted they had one meal a day. Now they are able to have two meals a day and she is able to send all of the children to school.
Her business is doing well and she has used the funds to increase her stock. She does have some slow months when the school demand drops and she does casual wear. She also sells clothing from the market. She uses the loan money to buy local material and also some material for uniforms. She is now waiting for the second loan of 400,000 UGX.
Grace impressed us as someone who was very vibrant and was clearly an inspirational leader in her community.
Conci Okila
We visited Conci’s vegetable stall about 2 kilometres beyond Kirombe Church out in the village. Conci is one of the village leaders and is aged 77. She is presently supporting three orphans, the youngest being 3 years old. She digs and grows some of her own vegetables and also sells vegetables. Before she had the loan she had real difficulties. It was difficult for her to dig because of her age and she had challenges with medical expenses and supporting the orphans in her care.
She has used the first loan to increase her vegetable stock, which she sells beside the roadway. She goes and gets vegetables from the nearby villages and brings them to her stall, where they are sold at a relatively small profit. However she has been able to pay the loan back and has also been able to make some small savings into the programme. Conci was an extremely articulate woman. She also still cultivates her land despite her age.
Mary Taaka
Mary is one of the woman leaders at Kirombe Pentecostal Church. She is also a leader in the loan programme and lives near Hope Restoration Centre.
We did not specifically ask her about the effect of the loan programme on her personally but did ask her to describe some of her observations of the changes in the members of the group. She described that the women in the group now had joy in their hearts and are not miserable. This was certainly our observation as well. She also said that the families are better dressed and the children have better physical appearance. Those who are widows have also been able to afford to put their children into school. She described that many people in Lira feared loans. There is justification for this as some micro-loan programmes have had bad effects in the local communities.
Some of the women engage in business of buying charcoal from villages and bringing it back to Lira and reselling it at a profit. She also described that, because people are busy with their businesses they don’t have time to gossip anymore and bring others down. She said that the loans have made people more diligent and hardworking. The new group is very active and meets twice a month for prayer and encouragement. There are a lot of other women who are wanting to join the group now.
She is good friends with Anna and between the two of them they are thinking about starting a fresh group and are wanting to go forward and not backwards. There is a high level of accountability in the new group and they are very supportive of one another. One of the beneficiaries had a sick child. Existing members go and pray for her and also support her during times when she is unable to make the payments.
Lillian Owuma
Lillian has a business whereby she buys bales of clothes which have been imported from Europe or the UK. She has a stall at the market and is on to her second loan cycle in the new programme. Her present loan size is 300,000 UGX (US$85). She says that sometimes the bales (because they are random) do not contain good clothes and it is sometimes quite hard to determine whether a bail has good quality or not. She states that the capital profit from the loan is ok and can sustain her, her two children and four orphans. She is able to add stock with the loan and is able to pay school fees, when she was not able to before. She had been struggling and her children had been excluded from school due to lack of payment of fees.
She is a single parent and is wanting to continue to use loans to enlarge her business and hopefully to expand into farming. She has land in her family village back at Abita (60 kms away) and she is hoping to use this.
It was extremely clear to us during our visit that there was a large and growing influence within the community. Anna is very well recognised in town and seems always to be involved with people both in Lira and in Mbale.
• Households stabilised
• Families and children able to have more than one meal a day
• The loan programme has grown well beyond its original size and has effectively doubled in the last year, with more growth coming, and effectively without additional support from BHW
• The fact that many people want to join speaks for itself
• Mary’s description of the beneficiaries as having a new sense of hope and purpose and joy was very exciting
• The mutual support that the women in these groups give one another is very inspiring
• The fact that they cover one another when one is sick or unable to make a payment, and also go and visit one another when they are sick or down or have a family crisis is also inspiring.
The plan is to let the programme grow organically and make sure that the newly identified leaders have the skills and integrity to help it grow stronger and in numbers.
We think that Anna has the best performing loan programmes in Uganda. This is both in the way the programmes are running and also the fact that the programmes are highly mutually supportive. This is something we observed in both Lira and Mbale and we like this. We wonder if there is a role for her to travel to other parts of Uganda to assist other partners in setting up a micro-loan programme. In particular we think that there is potential for Rukungiri in the near future and possibly in Nebbi.
When we were talking with Anna and Mary I also asked about whether there was any thought of there being a loan group for men. Anna is in fact presently exploring this as she has had a lot of requests from men for one. We understand that she has at least six men who are interested in becoming part of the loan programme and they are praying about it. Their plan is to start a separate programme. We understand that the potential beneficiaries are widowers. We indicated to Anna that we would be open to yet another programme (men only) provided it was made clear that they had to go through exactly the same training as the women and had to start with the same relatively small loan sizes. We think it is really important to start the loan sizes small and then grow them so that people do not have unrealistic expectations.
• Sickness
• Challenges in the marketplace
• Political instability
• The mentoring and training of good leadership to be able to assist in the programme
• To determine when the loan sizes have reached an appropriate maximum
• How best to support Anna as the overall leader of the programme as she faces a considerable number of challenges regarding how to manage an increasing workload and scope of responsibility
1) For the continued stabilisation of the people in the loan programmes. Many of them are recovering from the effects of the various conflicts, abandonment by husbands and other tragedies and injustices.
2) For the relationship with the women in the Kirombe Pentecostal Church to grow
3) Sickness plagues the members of the loan groups. This is clearly the single biggest issue which makes it difficult for loan beneficiaries to make payments.
4) There is a huge degree of instability in the market in Lira. A new market has been built but has not yet opened. There is competition for the places and the existing markets will be closed and demolished. It is clear that not all of the present stall holders in the existing market will be able to take up space in the new market and this is a highly political decision.
5) The political situation in Uganda is, at best, fragile. Presidential elections are scheduled for early next year and are clearly having a destabilising effect on the community. Some of the candidates are talking about the possibility of resorting to violence and the existing President is using executive powers to protect his position.
6) For wisdom as to how to grow these loan programmes as they can only grow effectively with good leadership. Good leadership does seem to be quite hard to come by but Anna appears to have chosen extremely well with the new women leaders. Please pray that the new leadership will rise to the challenge and be able to handle the responsibilities with diligence and integrity.
When we went this year we were extremely surprised at the degree of growth and development in the loan programmes. Last year it would be fair to say that Anna was the only clearly identified reliable leader but this year we have met with two other women, Mary Taaka and Grace Nam, both of whom have Anna’s confidence and appear to be women of real integrity and godliness. The caliber of these women gives us a significant degree of confidence that there is room for the micro-loan programme to develop.
We were also able to clarify something which has been a mystery for some time. Over the last few years we have been endeavouring to determine what the actual interest rate in the programme is. Anna has consistently stated “3% per month”. However this is incorrect. The effective interest rate in the programme is 12% per annum, 3% for every four month loan period, or 1% a month. One of the issues is that this interest rate effectively does not even go anywhere close to the rate of inflation.
Anna has used funds from the existing programme to start funding the new programme, without reference back to us. In other words, the funds were there and available for the next programme to start. The next part cannot grow however without further funding from BHW. Many of the beneficiaries have now gone through the first (200,000 UGX) loan cycle and are wanting to double their loan sizes. They are also saving into the programme and loans are being made available at the larger rate as and when funds are available but this process is slow.
In summary we left Lira with a good level of confidence that the loan programmes are in good hands and that Anna is making all of the right moves in terms of increasing the leadership base.
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