This 4 page brief shows how young people are using loans from VESAs to start their own businesses.
Day and Night
Day and Night
You don’t break the cycle of poverty by giving people money. You break it by giving them power. This has been CARE’s mission from the start – to give people the ability to take control of their futures, and not let it be dictated by assistance.
Every success story reinforces this mission. That’s why we’re publishing a series of success stories from CARE Ethiopia’s GRAD Program (Graduation with Resilience to Achieve Sustainable Development), a microfinancing program funded by USAID wherein communities set up Village Economic and Social Associations for its members (VESAs).
VESAs give members of the community a chance to buy into a savings and loan program, from which they can pull small, targeted loans to start new businesses and enterprises. It has been a wild success. Members are trained in financial management, adaptation to climate change, promotes behavioral changes in husbands and men, nutritious meals for children and there is an almost 100% repayment rate. Most importantly, it shows women that when the power is in their hands, great things can happen, and entire communities can prosper.
The program shows that when you give someone not assistance, but opportunity, just how far they will run with it.
DAY AND NIGHT
Hilifti was literally working 24/7, and still unable to feed her children. The GRAD Program gave her the ability to start her own business and a taste for success.
My husband and I divorced a long time ago and I raised my five children alone. I did some small trading—buying and selling grain— and sold local drinks. I was also a safety net beneficiary, receiving food for work during part of the year. I remember working day and night. There was no time to rest. But still, it was never enough.
When I first got involved with GRAD, I decided to try cattle fattening. It seemed like a good fit because I live in town and, though I don’t have a lot of space, I have enough to fatten a couple of oxen. Everything was new for me, but through GRAD I learned how to select the animals, how to take care of them, how to manage my income, and how to sell the oxen. I took a loan of 8,000 birr (US $360), and I bought the animals and some straw and feed. After six months I sold them. I was disappointed with the profit: just 1,000 birr (US $45) each.
Thinking it over, I realized this business was probably not the best fit for me. My children are grown, so they are busy with their own lives. They didn’t have much time to help me with the oxen. I also realized that I needed more space for them. So I asked the project people, and they gave me the training I needed to shift to what I felt in my heart to be right for me: opening a shop.
After paying back the first loan, I took another, this time for 15,000 birr (US $678). Having that money, and an activity that worked for me, I became more business-minded. I invested the money in a shop I had opened in my home.
A few months ago I finished repaying my second loan. Next time I am going to ask for even more: 30,000 birr. God willing, my oldest daughter, who is studying mechanical engineering at Mekelle University, will graduate next year. My plan is to use some of that money to help her get started in business. I will use the rest of it to expand my shop even more. If all goes according to plan, I will be able to repay that loan in two years’ time.
Now I know that success is not just a matter of working hard. I was doing that before. It is about having access to money, skills, and knowledge. It is about learning to use your options in a smart way. That is how you succeed.