PARTNERSHIP WITH BRAC IN SIERRA LEONE
Restless Development in Sierra Leone has signed a partnership agreement with BRAC, one of the world’s leading microfinance institutions, to launch a new pilot programme. The pilot provides us with a chance to try a new way of complementing our work in the community on livelihoods by adding access to finance to our capacity building initiatives, which train aspiring entrepreneurs.
A BIT OF BACKGROUND
Our UNDP Business Development Services project has a microfinance component for winners of a business plan competition we are running. Entrants receive training and skills development from our business development centre in Newtown, a rural town close to Freetown. A much needed part of a business plan competition is access to finance for successful winners, so these plans can be developed, launched and proven. We want to partner with the experts to utilise both agencies’ strengths, building on BRAC’s microfinance expertise.
THE PILOT WILL INCLUDE THE FOLLOWING:
• BRAC will disburse loans to 10 winners of the business plan competition.
• Up to 15 loans of lesser value will be disbursed to other Business Development Services trainees.
• The loan criteria will be youth-focused and developed together with Restless Development.
• Restless Development and BRAC will support the young people in their businesses and with managing the loans.
• A Monitoring & Evaluation system, building on BRAC’s current systems (with a youth-focus provided by the Restless team), will monitor the use of funds by all youth accessing loans for the next 3 years.
The last of these may turn out the most valuable for BRAC and Restless, as it will be the first relatively longitudinal study of youth microfinance in Sierra Leone. We plan to build a case for lending to young people. By comparing those receiving subsidised versus market interest rates, we also hope to prove that youth repay their loans and do this while building successful businesses. We want to overcome the attitude of commercial banks and many microfinance lenders – that ‘young people can’t be trusted with loans.......’.