Problem

Four out of every ten Mexicans are desperately poor. They live in slums or poor villages and are mostly under or unemployed. They often operate cottage industries or microenterprises, but without affordable working capital, they remain mired in poverty. Discussions with microentrepreneurs in Tlaquepaque reveal that they borrow their working capital from loan sharks who charge such high interest that they remain poor no matter how hard they work. They suffer, and their children suffer.

The Gift

Oportunidad Microfinanzas, an Opportunity microfinance bank, provides small working capital loans for people in chronic poverty. Loans range from $100 to $500, about what our target clients are borrowing from moneylenders. Spared high interest rates, our clients earn more to invest in the business. Their increased income helps them meet basic family needs. Children are going to school, not work. Group lending through Trust Banks gives hardworking people who have little opportunity to earn an adequate income the chance to become self-sufficient. By providing a loan, the group says to the borrowers, “We believe in you." Their sense of self-worth is strengthened, because money is given as loans and not handouts. With each loan they receive and repay, Trust Bank members become increasingly stable financially, more respected by their families, and better equipped to run their households and influence their community.