Our policy on financial services
Our goal: Empowered partner organisations enabling members to generate enough income from their activities to support the family’s well-being.
What we do
Microfinance, or financial services designed for men and women with limited resources, is an important tool in all We Effect´s areas of work.
We support member-based groups that focus on solutions for savings, credits and insurances. Since the groups are owned by their members, the members also control and own the solutions. This is a major advantage, since this kind of model discourages people from borrowing too much and falling into a debt trap. Any interest generated stays in the group or is distributed.
Since the State has an important role to play in increasing access to credit and savings, we also support organisations which seek to influence legislation so that access to financial services will benefit those in poverty.
Facts about financial services and poverty
People living in poverty, mainly those who live in rural areas, have no banking system to turn to in order to save and borrow money. Making it possible for people with limited resources to be able to save and borrow money is essential for development.
Microfinance, or financial services, reduces poor people’s vulnerability in times of crisis. Access to credit and savings enable people to develop businesses, and it is also vital if people are to obtain adequate housing. Financial services are also important in the work to improve equality between women and men, since for women, gaining access to capital is paving the way to economic independence.