The Microcredit Project aims to assist women who operate small businesses to increase the profits of their enterprises and achieve income security. Ultimately by improving the economic situation of the women, the goal is to improve the welfare of entire families and their communities.
Many women in Central Kalimantan operate micro-enterprises, predominantly as food or clothing vendors or as farmers running small-farms. The project provides these women with small loans that are used to invest in and grow their enterprises. The women then pay back the loans as per a set plan and the re-payments are used to finance a loan for another women.
Importantly, the program also provides training on how to manage small enterprises, on budgeting and on working together for the betterment of the community. The program is predominantly self- managed by the women who receive the loans. They, with the assistance of YUM, elect new participants to the program and set the guidelines for participation. Having these women manage the program improves the sharing of ideas and resources among the community.
The project was established in 2001 by the Indonesian Relief and Development Network (which is now part of YUM) and has since that time has assisted women from throughout the region to grow their businesses. In 2007 the project was relaunched with a new format that is helping more women access loans and use them more effectively based on principles endorsed by the Grameen Foundation.
Due to changes in Indonesian's microcredit law, YUM's Microcredit Project in Central Kalimantan was suspended at the start of 2009. Since then, with the help of Australian Volunteer Alison Collier, considerable work has gone into the re-design and improvement of the Microcredit project.
To re-launch the program, YUM will establish and manage a Women's Cooperative, which will invite women from the local community to join as cooperative members and apply for micro-loans to assist their small businesses.
Access to the formal credit market remains largely unobtainable to poor women in the local area and, as such, YUM's cooperative will bridge an important gap in the market. YUM wishes to support the growth of women's small businesses, leading to higher output and improved income security for women and their families.
In November Microcredit Project YUM staff member Lili Karlina and Volunteer Alison Collier were fortunate to spend a week at Tanaoba Lais Manekat Foundation (TLM) in Kupang, West Timor, where they learned about implementing and running a large microcredit project first-hand.
TLM was created as a non-government organization in 1995 in order to supply microcredit and business-related services within the province of Nusa Tenggara Timur (NTT). TLM now has over 11,000 clients who benefit from their microcredit project.
In future, YUM hopes to adopt a similar method in order to replicate TLM's successful standards.
The Cut Nyak Dhien 'Cooperative Society', run by local kader (advocate) women, continues to establish itself as an important community group in Banda Aceh, especially for women.
"We were one of the victims of the tsunami devastation, and so we had lost everything we owned in this world. We didn't have any capital to start a small business and my husband was too old to work. No one would hire him! Life was very hard."
"When I became a member of the cooperative, I was able to apply for a micro-loan. I used the money to open a small shop in front of our home. This little shop has helped our economic situation very much. And we are very thankful because of it."
(Ibu Ansariah, recipient of the Cut Nyak Dhien Cooperative Mirco loan program)
The Cooperative not only provides a large variety of goods at affordable prices, but invites women to become cooperative members, enabling them to apply for micro-loans to assist the development of their small businesses.
