Sustainable Financial Education Program for Nicaraguan Artisans

Sustainable Financial Education Program for Nicaraguan Artisans

Organization type: 
nonprofit/ngo/citizen sector
$10,000 - $50,000
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

Esperanza en Accion offers the Sustainable Financial Education Program to 225 low income artisans in Nicaragua, 85% of whom are women. This package of financial services helps them strengthen their small businesses through improved financial literacy and access to capital, in turn ensuring improved access to technology.

About You
Esperanza en Accion
Section 1: About You
First Name


Last Name


Section 2: About Your Organization
Is your initiative connected to an established organization?


Organization Name

Esperanza en Accion

Organization Phone


Organization Address

Del Porton de ENACAL, 1 cuadra al lago, 1/2 cuadra arriba

Organization Country

, MN

How long has this organization been operating?

More than 5 years

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Your idea
Country your work focuses on
What makes your idea unique?

This program seeks to alleviate the most pressing financial problems that artisans experience in their small businesses in order to help them create financially sustainable enterprises. In contrast to common microlending practice, our program is composed of three vital components to ensure sustainability and artisan involvement.

1. Financial Education: Trainings on financial education are provided to artisans based on their expressed needs. Past trainings have focused on Money Management, Production Costs and Basic Financial Literacy.
2. Access to Fair Credit: Artisans can access loans at a 0% interest rate and invest that money in their small businesses. This program requires artisans to choose their own repayment plan based on their ability to pay, making them responsible for their own loan terms.
3. Savings for the Future: Artisans create a savings plan based on their most pressing need in their small business, the projected costs, the timeframe and how they will save to meet that goal.

This unique program combines both the practical and the theoretical aspects of successful money management in order to empower artisans to become financially savvy and sustainable. Furthermore, this program helps artisans to access technology through improved money management and access to funds that were previously unavailable. Investments made in the physical space of their workshop, in machinery or in product promotion helps them to improve their sustainability and success as entrepreneurs.

Do you have a patent for this idea?

Tell us about the social impact of your innovation. Please include both numbers and stories as evidence of this impact

The Sustainable Financial Education Program increases artisans’ financial knowledge and access to capital through short term loans and long term savings. Each component uniquely impacts artisans’ small businesses.

Financial literacy trainings are the backbone of this program. Through trainings artisans learn to separate personal and business expenses, to calculate production costs and to better manage finances. To date, 80% of artisan groups have participated in financial education trainings.

The loan program provides loans at 0 % interest with repayment schedules which allows artisans to determine the rate and schedule of their repayments. So far, ten artisans have participated in Esperanza en Accion’s small loan program, with 100 % repayment. We have lent a total of $1,750 and hope to increase this number in the future. This program has given artisans such as Guadalupe Nororis and Francis Cano improved access to technology which has helped them to strengthen their small businesses. Both of these women entrepreneurs built kilns on their properties to fire their ceramic pieces and mitigate the risk that was involved in renting kilns from others. Other artisans used loans to purchase raw materials, to participate in fairs and to make improvements to their workshops.

The Savings Program is the final piece of our Sustainable Financial Education Program. In addition to loans for the short term, it is essential to also build knowledge of how to create savings for long term sustainability. Twelve of twenty-five artisan groups have developed savings plans to address a variety of needs in their small businesses. These range from purchasing machinery and raw material to improving their workshops and creating medical funds for their group. In the process artisans work to meet their needs by creating savings and further increasing their independence as small business owners.

Overall this program is a financial revolution for small business owners who previously lacked access to capital as well as the knowledge of how to better manage their existing funds to promote sustainability in their businesses. The Sustainable Financial Education Program enables low income artisans in Nicaragua to be the principal actors in their own development.

Problem: Describe the primary problem(s) that your innovation is addressing

Esperanza en Accion’s Sustainable Financial Education helps combat some of the most critical problems that impoverished artisans in Nicaragua face.

While artisans have an amazing ability to make beautiful works of art through skills that have been passed down through generations, they often lack financial literacy due to severe poverty, low education levels and rural living. This reality is even more severe for women artisans, whose access to education and critical role in household management compound their lack of access to basic financial education. These challenges translate to difficulty in determining product pricing, establishing long term financial stability and day to day financial management of their small businesses.

An even larger problem is artisans’ ability to access credit as lenders often seek to take advantage of poor borrowers by imposing interest rates that range from 25-70% annually. This creates a barrier for artisans as they are unable to access the credit necessary to invest in technology that will improve their small businesses.

Similarly, for many living in poverty in Nicaragua, savings is not practical, in part due to lack of capital to create a savings as well as a lack of a savings plan. Lack of savings prevents artisans from being sustainable and reduces their ability to withstand the risks involved in owning a small business.

Together these problems create a significant barrier in the creation successful sustainable businesses which artisans can rely on to support themselves and their families.

Actions: Describe the steps that you are taking to make your innovation a success. What might prevent that success?

In financial education, most of the artisans we work with are women who live in rural areas with low education levels. One risk is that financial education theory will not be put into practice. In order to prevent this, we are performing site visits to artisans and helping them integrate topics covered by the trainings into their small businesses.

The loan program presents the risk that artisans will not pay back the money that they borrow, in turn jeopardizing future loans to other artisans. This has not yet been a problem, due to Esperanza en Accion’s eight year relationship working with and helping artisans find solutions to specific problems that they face. We continue to build relationships through visits and phone communication, along with a history of services that artisans have received from Esperanza en Accion. Additionally, the loan program is designed to involve artisans in the process, asking them to determine their own repayment terms, improving the potential for loan repayment.

Finally, the savings program runs the risk that artisans will not meet their savings goals, due to lack of funds or lack of discipline in saving. The savings program was created so that artisans could develop realistic goals that they can meet, improving the probability that they will be able to do so. In addition we are offering to match artisans’ goals up to $150 per group if they meet their goal, providing further incentive to meet the goal they have established.

Results: Describe the expected results of these actions over the next three years. Please address each year separately, if possible

Year 1, 2010:

In 2010 we expect to see improved results in artisans’ businesses due to their improved access to financial education. At least 10 artisan groups will know how to calculate a fair wage for their products and they will begin to separate personal and business expenses. We also expect to see improved access to technology due to the loan program where artisans can better equip their small businesses due to increased access to credit for at least 7 groups. Currently we have 12 savings plans and expect to see at least 8 more groups develop those plans where they will save for the goal of their choice in their small business.

Year 2, 2011:

In 2011 artisans will have greatly improved their small businesses and their ability to produce artwork, in turn they will be better able to meet the demand of their clients. Many will have improved access to technology due to the investments made through their loans and their savings. We will continue to encourage artisans to develop savings plans and hope to have 100% participation in developing second year savings plans. We will continue to invest in trainings for improved financial management and will make more loans based on the need of the artisans.

Year 3, 2012:

By year three, we are expecting all groups to have created savings, even if they have not met their goals. Depending on the success of their group savings programs, the loan program will not be as necessary, or perhaps for larger investments. Our financial education program will transform to address changing needs of the artisans groups. At this point, we may evaluate the possibility of including new artisan groups in the Sustainable Financial Education Program.

How many people will your project serve annually?


What is the average monthly household income in your target community, in US Dollars?

$50 - 100

Does your innovation seek to have an impact on public policy?


If your innovation seeks to impact public policy, how?

Approximately 150 words left (1200 characters).

What stage is your project in?

Operating for more than 5 years

Does your organization have a board of directors or an advisory board?


Does your organization have a non monetary partnerships with NGOs?


Does your organization have a non monetary partnerships with businesses?


Does your organization have a non monetary partnerships with government?


Please tell us more about how partnerships could be critical to the success of your innovation

Partnerships with other organizations have been critical to our success and will continue to help us to develop our programs. We have worked with both non-profit and governmental institutions to help us develop trainings, material for artisan visits and understanding what’s already happening in Nicaragua in terms of small-scale lending programs. These partnerships have helped us to solidify and strengthen our existing work and we intend to continue to seek such partnerships in the future.

We would like to learn more about how your initiative is financially supported. Please explain your business plan/revenue model

Esperanza en Accion is a non-profit organization that operates based on donations from individuals and sales of our artisans’ work to support our programs. We will continue to look for support for these programs through individual contributions as well as through grant opportunities that can help us to expand these already existing programs.

While we have raised funds for the small Loan Fund the funds that we have raised have been less than the demand for the loan fund itself. Esperanza en Accion has given out loans out of our operating budget funds due to the large demand that the opportunity for these loans has presented. With 100 % success rate of loan repayment, this has not been a problem. We hope in the future to grow the loan fund and have a formal revolving loan fund that will be exclusively used for the artisans’ loans, but for the moment we have used both donations to the loan fund and funds from our operating budget to sustain this program.

The Story
What was the defining moment that led you to this innovation?

Previous to developing the Sustainable Financial Education Program Esperanza en Accion was working primarily on connecting Nicaraguan artisans to fair markets in the United States and Nicaragua. Our programs were focused on quality control of products, production goals and were less focused on the financial aspect of artisans' businesses.

This innovation was developed when we began to realize that artisans' businesses were not sustainable due to lack of knowledge of business practices that would allow them to better manage the financial aspects that they were lacking.

It became clear to us that without improved financial education it was a very real possibility that artisans would not be able to continue sustaining themselves and their families through the sale of their artwork. In many cases that would result increased migration to other countries to look for work, a trend that is a reality for many Nicaraguans.

This became the defining moment that pushed us to develop this financial education program and we believe that it is now one of the strongest programs that Esperanza en Accion is developing for the artisans we serve.

Tell us about the person—the social innovator—behind this idea.

Emily Hewes, the Executive Director, together with Yamileth Perez, the Director of Programs were the two that have been developing the Financial Education Program for Esperanza en Accion. They are also the two that have been developing the majority of the curriculum and the ideas for the three different aspects of this program.

These women bring two very different, yet complimentary experiences to develop this unique program. Ms. Perez has had years of experience in community organizing in many different neighborhoods of Managua, Nicaragua and has an amazing ability to integrate the financial education information into the lives of the artisans that makes it more accessible for them in their work. Mrs. Hewes brings her experience of working with other sustainable development projects and a background in teaching to this program.

How did you first hear about Changemakers?

Friend or family member

If through another source, please provide the information
Does your project address any of the following barriers to women’s technology access and use?

Women’s time poverty, Social norms, Economic or institutional constraints, Women’s lack of involvement in the technology development process.

If you checked any of the boxes above, please explain how.

Esperanza en Accion's Sustainable Financial Education Program has a focus on helping women to ensure that they take into account their time worked on their artwork in order to ensure that they are receiving a fair wage for their work. Esperanza en Accion stresses the importance of timing women's work on each piece to ensure that they are paying themselves for their time worked. This has been an especially important revolution for women as the majority tend to work in their homes and have had no idea how much time they spend making their pieces. In each case where Esperanza en Accion has helped women to time the work on their pieces they have been able to increase the sale price of their pieces to reflect the work invested.

This in turn has helped to bridge economic constraints that women have had because it helps to increase their income in their family. By bringing more money into the household women artisans in Nicaragua have also been able to break social norms that previously had placed their importance only in what they could do in the household, not on their ability to bring money into the home.

Esperanza en Accion is also helping women to be involved in technology development because the artisans themselves are identifying the technologies that they most need and they are implementing those technologies in their small businesses. Through the Sustainable Financial Education Program artisans have the ability to access capital that then is used to access the technology that they identify as being critical to their business development.

Does your project involve women in one or more of the following stages of the technology lifecycle? Identification of the problem the technology will solve:

Technology training, Creation and maintenance of market linkages for women's economic outputs, Assessment and evaluation.

If you checked any of the boxes above, please explain how you will ensure women’s involvement in each relevant phase of the technology lifecycle.

Esperanza en Accion is run and operated by women and the main beneficiaries of all programs are women. Women are involved in technology training because the women of Esperanza en Accion are involved in doing all financial training with the artisans we work with.

This is also true for the creation and maintenance of market linkages as Esperanza en Accion finds fair markets for artisans' products both in Nicaragua and in the United States. All of this work is done by women, indeed they are critical to the success of the organization.

If women are a focus of your project, how did this focus evolve?

The project focused on women from its conception..

Which type of women will your project reach directly?

Rural, Peri-urban, Urban, Low income.

In what ways does your project team/leadership involve women?

It is led by a woman/women., It is led by a woman/women from a developing country., The core project team includes women., The core project team includes women from developing countries..

Has your organization formed any new partnerships in response to this challenge? If so, with what type/s of organization/s?


Has your project leadership had prior experience with the following?

Working with women, Working to increase women's economic empowerment through technology, Working on innovation.