The Changemakers team is excited about your idea of offering partial loan guarantees and technical assistance as a way to reduce credit risk for community-based organizations. These two components (loan guarantees plus technical assistance) indicate a high degree of social impact and innovation that is further illustrated by your strong impact data. We are interested in the operational aspects between farmers and banks. How do you integrate these systems? Is there additional innovation in this model and using it as a management template?
We think there is potential for even greater impact given the scalability of this project. In order to continue growth and development, we would like to know the steps you have taken towards establishing self-sustainability.
Since the judges spend more time reading the entry form than the comments, please also update your entry in addition to responding to our questions and other comments. This will provide the panel of expert judges with the most comprehensive explanation.
Thank you very much for your comments regarding LWR’s Tripartite Rural Financing Model.
Concerning the operational aspects between farmers and banks, LWR’s worldwide programming is based on the concept of accompaniment, and seeks to build organically on the goals of the community. As the project design process begins, LWR’s Country Program Manager (CPM) works very closely with both the community based organization (CBO) – which is often comprised of associations of farmers – and with the financial institution to explore potential tripartite partnerships, and to identify any capacity or skills gaps that may present challenges to successful implementation. The CPM also ensures that the project’s work and implementation plans match the loan repayment schedule, while working with the CBO to develop a plan to strengthen the organization’s management and financial capacity to ensure success. Throughout the project, the CPM continues to work with the CBO, as well as maintaining a close relationship with the financial institution, to ensure smooth implementation and do any required troubleshooting. Finally, as the project draws to a close, the CPM will work with an evaluation team to assess the project’s success, including management and repayment of the loan. These relationships are defined in specific partnership agreements with each of the institutions.
Sustainability of these relationships is ensured by investing not only in the specific project, but also in the management, financial and organizational capacity of the CBO. LWR ensures that after the project’s end, the organization is stronger and better able to operate independently of LWR. By linking them with a local financial institution, LWR also opens up long term credit potential for the organization and its members. This dual approach ensures that farmers and their organizations are able to leverage their own assets for sustainable initiatives. Over time, LWR has found that often the financial institution no longer needs the same level of guarantee as their confidence in the model grows. This then frees up those LWR resources for other projects. In other cases, due to the previous success of the model, the lender does not require a financial investment by LWR from the start of the project, as occurred with two large banks in Mali and Niger.
On November 3, 2008, the judges reviewed the entries for the Changemakers “Banking on Social Change: Seeking Financial Solutions for All” competition and would like to pass on the following feedback (listed below) for your entry. Thank you for applying and for your hard work in the field. We are excited to archive your entry to serve as a leading solution for the worldwide community of innovators who are seeking solutions that allow financial security to become a reality for everyone. We wish you continued luck with your sustainable, innovative, and socially impactful initiatives.
All the best, The Changemakers Team
“This initiative is an interesting intermediary between farmers and financial institutions designed to assess loan risks and strengthen the financial and technical components of the project being funded. I look forward to its growth and expansion.”
- Changemakers “Banking on Social Change: Seeking Financial Solutions for All” Judges: Citi, The Times of India, Nokia, Soros Fund Management LLC, PlaNet Finance.
Comments
Dear Evariste,
Thank you for submitting your entry!
The Changemakers team is excited about your idea of offering partial loan guarantees and technical assistance as a way to reduce credit risk for community-based organizations. These two components (loan guarantees plus technical assistance) indicate a high degree of social impact and innovation that is further illustrated by your strong impact data. We are interested in the operational aspects between farmers and banks. How do you integrate these systems? Is there additional innovation in this model and using it as a management template?
We think there is potential for even greater impact given the scalability of this project. In order to continue growth and development, we would like to know the steps you have taken towards establishing self-sustainability.
Since the judges spend more time reading the entry form than the comments, please also update your entry in addition to responding to our questions and other comments. This will provide the panel of expert judges with the most comprehensive explanation.
Thanks so much! We look forward to learning more.
Best wishes,
The Changemakers Team
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Kaylena Bray
Ashoka's Changemakers
Dear Kaylena,
Thank you very much for your comments regarding LWR’s Tripartite Rural Financing Model.
Concerning the operational aspects between farmers and banks, LWR’s worldwide programming is based on the concept of accompaniment, and seeks to build organically on the goals of the community. As the project design process begins, LWR’s Country Program Manager (CPM) works very closely with both the community based organization (CBO) – which is often comprised of associations of farmers – and with the financial institution to explore potential tripartite partnerships, and to identify any capacity or skills gaps that may present challenges to successful implementation. The CPM also ensures that the project’s work and implementation plans match the loan repayment schedule, while working with the CBO to develop a plan to strengthen the organization’s management and financial capacity to ensure success. Throughout the project, the CPM continues to work with the CBO, as well as maintaining a close relationship with the financial institution, to ensure smooth implementation and do any required troubleshooting. Finally, as the project draws to a close, the CPM will work with an evaluation team to assess the project’s success, including management and repayment of the loan. These relationships are defined in specific partnership agreements with each of the institutions.
Sustainability of these relationships is ensured by investing not only in the specific project, but also in the management, financial and organizational capacity of the CBO. LWR ensures that after the project’s end, the organization is stronger and better able to operate independently of LWR. By linking them with a local financial institution, LWR also opens up long term credit potential for the organization and its members. This dual approach ensures that farmers and their organizations are able to leverage their own assets for sustainable initiatives. Over time, LWR has found that often the financial institution no longer needs the same level of guarantee as their confidence in the model grows. This then frees up those LWR resources for other projects. In other cases, due to the previous success of the model, the lender does not require a financial investment by LWR from the start of the project, as occurred with two large banks in Mali and Niger.
Sincerely,
Evariste Karangwa
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Dear Evariste,
On November 3, 2008, the judges reviewed the entries for the Changemakers “Banking on Social Change: Seeking Financial Solutions for All” competition and would like to pass on the following feedback (listed below) for your entry. Thank you for applying and for your hard work in the field. We are excited to archive your entry to serve as a leading solution for the worldwide community of innovators who are seeking solutions that allow financial security to become a reality for everyone. We wish you continued luck with your sustainable, innovative, and socially impactful initiatives.
All the best, The Changemakers Team
“This initiative is an interesting intermediary between farmers and financial institutions designed to assess loan risks and strengthen the financial and technical components of the project being funded. I look forward to its growth and expansion.”
- Changemakers “Banking on Social Change: Seeking Financial Solutions for All” Judges: Citi, The Times of India, Nokia, Soros Fund Management LLC, PlaNet Finance.
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Kaylena Bray
Ashoka's Changemakers
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