
Microloans
Better Globe’s vision is to eradicate poverty in Africa. A large proportion of the poor population are farmers in the countryside. We operate our tree plantations in these areas, and through microfinancing we create the conditions for the people in these areas to earn their own money. It enables them to expand their farming operations and increase their income.
So far we have funded one microloan bank in the Mboti area in Kenya and yet another bank is funded and in the start-up phase. The banks are run by our partner K-Rep Fedha Services Co. Ltd. Microfinance for the poor is a proven way to help people to get themselves out of poverty. Microloans are small loans without any collateral requirements.
In 2006 the banker Muhammad Yunus from Bangladesh and his Grameen bank received the Nobel Peace Prize1. Yunus had shown that it is possible to create economic and social development from the bottom and up. The Nobel Foundation further motivated its decision;
Lasting peace cannot be created without large groups of people finding ways to break out of poverty. Microfinance is such a way.
The microloan bank is a cooperative owned by the borrowers, who today number about 4100 families. We do not own, operate or make money of microloan banks; we fund them.

A new borrower initially needs to buy a bank book in which all future bank transactions will be registered and attend a four-week training course in economics learning, among other things, different ways to create an income or ways to reduce spending, with the help of the borrowed money. Thereafter the borrower can receive the first loan.

The first loan may be between 1 200 and 10 000 Kenyan shillings (equivalent to approx. 120 to 1 000 SEK), with a repayment period of six months, and it must be repaid before the next loan can be taken. Similarly, each loan has to be repaid before the borrower can take new, progressively larger, loans with longer repayment periods.
What the loans are used for
The loans are often used in part to make life more comfortable, such as metal roofs or mattresses and to start or develop agriculture, livestock or other business activities. It can also be about reducing expenditure by buying a stove that saves on wood or a solar lamp that provides long-term savings in both health and money in comparison to kerosene lamps.
The money is also used to pay school fees, or to build and renovate buildings. The borrowers can also choose to borrow assets, like chairs (for businesses like cafés or for lecturing), watertanks, and solar panels.

Since the borrowers are co-owners of the bank, they receive part of the profits at the end of the year. 40 percent of the profits are paid to the owners and 60 percent is invested back into the business. When you as a customer invest in trees and decide to purchase a donation package, you contribute directly to people getting a better life and help entrepreneurship get off the ground in rural areas of Kenya and Uganda. By extension, we develop the infrastructure in these areas through microloans.
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Please feel free to read more here on the website, if you have other questions. We have a FAQ page with the 50 most frequently asked questions, and you can of course contact us at support@betterglobe.com.