Our approach to microfinance is tailored to the unique situation of La Unión.
We provide rural microfinance to poor, small-scale agricultural producers of coffee, corn, and beans. Our microfinance program gives our clients the financial resources to improve their production, which then increases their income.
In addition to the complementary programs of Technical Training and Aldea Coffee, microfinance is essential to giving our clients the opportunity to provide their families with a better, poverty-free future.
If you would like to learn more about the background of microfinance, check out these sections:
Our microfinance program is structured around the strength of community found in all of the aldeas of La Unión.
For one, our clients cannot afford to offer physical collateral as a loan guarantee, so we rely on social collateral. In fact, social collateral is one of the most important factors that makes microfinance work. It works because standing in one's community, and the influence a community has on an individual is paramount. For people in an aldea to make a promise that they will repay a loan, that is often enough; otherwise they will lose face in their community.
Community influence is further bolstered by a board of directors, comprised of leaders from the aldea. They make sure only responsible people are receiving loans and they're making sure people stay responsible throughout the the loan cycle. Essentially, the board of directors help us and our clients make the right decisions.
Since social collateral is vitally important to our microfinance program, this is why we aim to understand it through our research. For more information, visit our [Research] section.
There is a distinct wealth gradient in the La Unión municipality. There are a few large landowners, then there is an overwhelmingly large poor population.
They work for the large landowners, but many have hope of making it on their own. They often start by borrowing a small plot of land and planting some coffee on it. With some time, help, and extra money, they could have the chance of poverty-free self-sufficiency. These are our clients.
Our clients produce coffee, as well as the subsistence products of corn and beans. With microfinance, we help our clients to sustainably improve their production to help them rise out of poverty.
Microloans help our clients improve their agricultural production in ways that they would not be able to afford otherwise.
Be it in the form of fertilizers, tools, seeds, or other such necessary equipment, microloans allow clients to invest in their work. This means better production, higher wages, and the opportunity for the long-term improvement in their families' quality of life.
Our base of operations is in the village of La Unión, which is central to all of the aldeas.
So our field officers have no trouble riding out to loan meetings in the company motorcycle. And the administrative team can keep track of loan activities, organize research projects, manage back-end operations, and plan training sessions with our partner organizations. Get to know the members of Our Team, the people that make this all happen!
Go on to learn how we reinforce our microfinance program with Technical Training.
Aldea Development is a 501(c)(3) nonprofit organization.
©2009–2017 Unión MicroFinanza Inc.