PFD's work in credit: Nigeria | Bosnia & Herzegovina

In Nigeria, an estimated 35 million people live on less than $1 per day. In central Nigeria, a region where ethnic minorities predominate, income-generating options are few, and unemployment is officially estimated at more than 15%. Underemployment is widespread and the average monthly income per household is less than $30/month.

There are serious attendant problems to such levels of poverty, namely: low levels of education, limited access to factors of production, and severe health problems including an estimated 32% of children suffering from malnutrition. These problems create a self-perpetuating cycle in which communities and individuals find it more difficult to rise above the poverty that brought such problems in the first place.

One means of breaking this cycle is to increase access to credit for those unable to access credit through banks – either due to lack of collateral or because their credit needs are too small to be attractive to banking institutions.

In response, PFD has established credit programs primarily targeting women traders in Benue and Nassarawa states. Similar programs are being developed in Bauchi state as well. The credit program is being implemented through local NGOs partners with PFD providing the local NGOs with loan capital and operational funding for the first 24 months. As the local NGO matures, PFD gradually withdraws operational funding and the NGO sustains its operation based on income generated from the revolving loan fund. Throughout the partnership, PFD provides intensive capacity building and close monitoring and evaluation.

Partners for Development has also taken concrete steps to integrate health education components into programming in existing projects in the credit and small enterprise development (SED) sectors. To that end, PFD has been working with its network of twelve NGO partners to incorporate reproductive health education into their micro-credit activities and to establish links between borrowers and appropriate health care providers.

For more on PFD’s work in Nigeria, click here.

In Bosnia & Herzegovina, a key component of PFD’s Integrated Agricultural Development Program has been the establishment of a commercial credit program through which members of the PFD-supported Independent Farmers’ Association (IFA) can access agricultural loans administered by UPI Bank, a national commercial banking entity.

IFA credit activities are working in conjunction with PFD’s other efforts to increase farmers’ access to agricultural marketing opportunities and information. Credit, in fact, follows upon training and other capacity-building activities as a means through which farmers can put lessons and theories into practice by investing in new techniques and equipment. Credit is also the means through which small-scale farmers are able to participate in PFD supported agricultural activities such as joint procurements and buy-off stations.

In 2003, in response to the IFA credit program, UPI Bank opened a branch office in the Bugojno municipality, where the IFA is based, and set up two credit lines, one to be used for joint procurements of agricultural inputs and the other, an open credit line for agricultural activities.

For more on PFD’s work in Bosnia & Herzegovina, click here.