Mercy Corps Europe

Microfinance in the Central African Republic

Helping families to cope with crisis, by providing access to three basic financial services – savings, credit and insurance. Mercy Corps is training community-managed Village Savings and Loans Associations to help families save for a rainy day and access credit to help them build for the future.

history Campaign has now closed

It ran from 12:00 AM, 1 January 2010 to 12:00 AM, 1 October 2011

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Registered Charity in Scotland (SC030289)

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    Category

  • Poverty Alleviation/ReliefPoverty Alleviation/Relief

    Helping

Location

Situation

The Central African Republic is one of the poorest countries in the world, ranking 159th out of 169 countries on the UNDP Human Development Index. 67% of the population lives on less than $1 per day and 84% lives on less than $2 per day. A severe lack of access to credit, lack of financial resources to cushion families against external shocks and a lack of secure places to save contribute significantly to these pervasive levels of poverty.

Solution

Mercy Corps is helping to provide access to three basic financial services - savings, credit and insurance - in the Central African Republic, by facilitating the creation of Village Savings and Loan Associations (a type of microfinance managed by communities). Members meet on a weekly basis to lodge their savings. After 5 weeks of saving, members can take out a loan of up to three times the value of their savings. Members then repay the association within three months.