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CoCoDA's cooperation: $2,400 (4th quarter 2001) Project calendar: February - April, 2002 Project partner(s): St. Joseph Partners in Justice Fund, Sisters of St. Joseph of Carondelet (St. Paul Province, MN) Associate organization managing the project: Committee for Reconstruction and Socioeconomic Development of Communities of Suchitoto, Cuscatlán (CRC) Description of results A $2,400 grant was made in November, 2001 to the Committee for Reconstruction and Social and Economic Development of Communities of Suchitito (CRC) to provide training in agricultural production and credit management for 50 women in rural communities, and business management and training for 7 women, including leadership of the Women's Secretariat of the CRC (WS), as well as training in new recipes for 3 women who operate the Las Orquideas cafetín, a small business of the WS. The project also included a technical assessment of the performance of a Women's Revolving Loan program established in 1997 by the WS with a seed grant from CoCoDA and the Blue Grass CoCo Project (KY). This grant for technical training was funded by the Partners in Justice Fund of the Sisters of St. Joseph of Carondelet, St. Paul Province (MN). A. Evaluation of WS Revolving Loan Program Manuel Romero Meléndez, a Salvadoran agronomist, spent the months of February, March and April of 2002 visiting all the women who had received loans from the WS Revolving Loan program from 1997 through 2001. During these visits, he analyzed with each borrower how they managed their loan, updated their outstanding balances (if any), provided current information on market prices for basic grains to help them determine the best time to sell their harvest. This work with the WS loan program borrowers permitted Mr. Romero to analyze the successes and the difficulties of the WS Revolving Loan program, which was established with a $10,000 seed grant from CoCoDA , the Blue Grass CoCo Project in central Kentucky, and several other contributors, in 1997 (see update on Women's Revolving Loan Fund). B. Training workshops in administration of loans, production and businesses In April, Mr. Romero, in cooperation with women borrowers of the WS Revolving Loan program, led 3 training workshops in administration, each in a different geographic area of Suchitoto, with a total of 29 women from 15 communities participating. The workshops were held in the communities of San Rafael, Mazatepeque, and Hacienda Sitio Zapotal. The workshops consisted of 5 agenda items: • Welcome,
introductions and presentation of the theme of the workshop
Some of the feedback from participants in the evaluation of the workshops: What did you learn? • We
learned to analyze what we invested to produce crops, because we didn't
know what we were investing. What do you think about the methodology and how the theme of administration was explained? • The
method was clear because comparisons were made with what we are doing
in practice, and we didn't get board because the
presenter spoke clearly and loudly. Regarding loans from the WS of the CRC, what problems did you face and how could the program be improved -- regarding interest rates, technical assistance, amount of money available for a loan, and the time of loan availability? • We
think the interest rates are very high. C. Training for cooking new recipes for three women employees of the Las Orquídeas café, a business venture of the WS. Three women who manage and cook in the Las Orquideas café, a business of the WS/CRC, learned new recipes to diversify their menu. |
Women's Revolving Loan Fund CoCoDA's cooperation: $10,000 (1997) Project calendar: 1997-2001 Project partner(s): Blue Grass CoCo Project
(KY) Description of results During
the period of February-March, 2002, Manuel Romero Meléndez led a participatory evaluation of the performance of
the Women's Revolving Loan Fund of the Women's Secretariat of the CRC
in Suchitoto, Cuscatlán, which was begun by a seed grant from
CoCoDA / Blue Grass CoCo Project (KY) in 1997. During the first five
years of the Funds operations, 143 loans were issued to 51 women in Suchitoto
communities, totaling $28,163 in loans. Of the borrowers, 45% used the
loans for farming: basic grains (corn, sorghum, sesame), vegetables and,
to a lesser extent, sugar cane; 39% used their loans for small-scale
business ventures, such as stores out of the homes; and 16% used their
loans for animal projects, such as pigs, chickens for eating and cattle.
Of the 143 loans issued, 108 (75.5%) have been repaid, leaving 35 (24.5%)
pending payment, most of which are past due in making payments. A total
of $25,669 in principal and interest payments have been made, while $7,920
in principal and interest payments are outstanding. Results of Mr. Romero's evaluation: • Size of the loans ranged from $34 to $571. All loans were made in the Salvadoran currency, colones. • Loan
Program performance in terms of % of borrow payback records as follows: Why were some unsuccessful in paying back loans? Mr. Romero interviewed the 36 borrowers from 10 communities who had fallen behind or missed payments on their loans. Of these women, 20 had loans for agricultural production, 10 for small business ventures, and 6 for animal projects. • Agricultural production: Of the women who produced corn or sorghum, 6 said they sold their harvest immediately to be able to pay back their loan; and 12 said they stored their grain in metal silos waiting for prices to go up to sell and be able to pay back their loan. Production was limited due to draught and plagues. Also, 3 women farmers emigrated to the United States due to economic difficulties. • Animals: Of the women who had livestock projects, 2 had cattle, 2 had pigs, 1 had chicken for eating, and 1 had hens for laying eggs. Those with cows benefited from dairy products, then offspring which were sold for economic gain; of the 2 with pigs, one lost hers due to unsanitary conditions that led to disease, the other fattened the pigs and sold them; the woman with chickens for eating successfully raised 2 generations but then had a disease that killed all her chicks and she stopped production after that, although they still have a coop with feed and water bins for 300 chicks; the woman with laying hens stopped production due to health problems. • Small business ventures: 20 women started small stores to sell drinks, basic food and personal hygiene items, snacks and candy. One store in the community of San Rafael la Bermuda has an artisan oven for baking French bread. A number of these stores are no longer functioning. The most successful has been a gas canister sales store. • Technical assistance and training: Of the women interviewed who had missed payment on their loans, 72% said they did not receive any training for managing their loans. Of these same women, 94% said they received their loans in the moment that they needed them. Most said they saw immediate benefits from the loans, allowing them to produce grains for family consumption or to generate income for the family, but they fell into debt when they faced crop failures, drops in market prices, or drops in sales. In summary, reasons borrows fell behind in payments on their loans were: A. Economic Factors B. Environmental Factors C. Institutional Factors • Lack of follow-up with the borrowers for the use and management of the loans. Recommendations 1. Design a policy for recuperation of delinquent loans, pardoning the unpaid interest and late payment fees, to allow at least for recuperation of the working capital -- especially for those cases in which the loans were due up to 4 years ago. 2. Recuperate those loans issued within the past year, according to the terms of the loan, with 2002 as the time period for payment. 3. Provide follow-up in offering assistance in managing of loans, training in administration to borrowers at the beginning of the year, and then make follow-up field visits in the course of the year. Women's Secretariat responds to the surveys and recommendations: In response to the feedback from beneficiaries and the recommendations of Mr. Romero, coordinators of the SM provided the following bits of information and comments: • Presently they charge 18% interest on the loans, which is used to help increase the capital of the fund. Administrative costs are covered by the CRC. A CoCoDA technical support team from the Kellogg Corps of Northwestern University had recommended a 21% interest rate during an evaluation with the SM of their program several years ago. • The SM wants feels the need to put some new policies into place for evaluating the social and economic situation of each beneficiary, to help in recuperating more of the loans. However, many of the late or defaulted loans are due to circumstance beyond control, such as draught, drastic drops in market prices, or sometimes family problems. • There are not preferences to certain individuals in making loans. However, there is a criteria that there be a women's committee in the beneficiaries community, and that local committee plays an active role in promoting the fund in their community, and interviewing women seeking loans. • The SM wants to increase the amount of capital in the Fund, and provide more technical assistance to borrowers. |
Last Revised on 15 May 2006