We Support LendWithCare – find out why

The Rotary Club of Bangor is an active member of Lend With Care, a charity that is using microfinance to help change the world. In this article, Lend With Care explains how it works and what it is achieving. 

Lendwithcare is a revolutionary way to help some of the world’s poorest people work their way out of poverty with dignity. Lendwithcare allows you to lend as little as £15 to fund a small business and once your money is repaid you can choose to recycle your loan to support another poor entrepreneur or withdraw your money. Lendwithcare is currently working in ten countries. See how Lendwithcare works here.

Lendwithcare is an initiative of poverty-fighting charity, CARE International UK.

100% of the money loaned through Lendwithcare goes to the entrepreneur so please consider becoming a Lendwithcare Angel and making a monthly donation to help us expand Lendwithcare to even more countries and help more people out of poverty.

CARE International UK

CARE International UK is a member of the CARE International confederation, one of the world’s leading aid and development organisations.

CARE fights poverty and injustice in 87 countries around the world to help the world’s poorest people find routes out of poverty. We provide immediate aid to people hit by disasters and emergencies, and long-term support to poor communities to rebuild lives and overcome poverty.

With 70 years’ experience of creating lasting change, we recognise that women and girls suffer disproportionately from poverty – but that equipped with the proper resources, women have the power to help whole families and communities escape poverty. That’s why women are at the heart of our community-based efforts to improve basic education, increase access to quality health care and expand economic opportunity for all.

CARE is non-religious and non-political, allowing us to deliver humanitarian and development assistance to anyone in need regardless of race, gender, ethnicity, age, religion, political view or sexual orientation.

You can find out more about how we are helping to transform lives at the CARE International Website.

Our expertise in microfinance

We are dedicated to helping people transform their own lives. And we think microfinance is an ideal way to do it.

Our innovative solutions aim to ensure that poor people across the world have access to the financial tools and training they need to lift themselves out of poverty.

CARE has been working on microfinance for more than two decades. We pioneered Village Savings and Loan Associations (VSLAs), which enable people in poor communities to save and borrow money – meaning they can plan for the future, and get loans to start up or develop small businesses.

But we believe that the real potential of microfinance is still to be realised. Most of the world’s poorest people still have no access to basic financial services – and little hope of lifting themselves out of poverty.

That’s why we set up Lendwithcare. And that’s why we need your support.

To find out more about our microfinance programmes all over the world.

What are village savings and loans groups?

As their name suggests village savings and loans (VS&L) groups are groups formed by poor people that begin by pooling the savings of members and then eventually using these savings to make loans to individual members. They may also focus on building the capacity of members in different areas including business management. The VS&L methodology seeks to facilitate the economic growth of a community and empower its members.

CARE developed the VS&L methodology in Niger in 1991 in order to provide financial and non-financial services to the very poor. VS&L groups provide the means for low-income populations without access to formal financial systems to organise and finance their own informal financial institutions.

In Africa and other parts of the developing world, CARE has found that MFIs do not always reach the very rural and isolated poor or those considered very poor owing to the high costs incurred to reach clients and the small demand for loans. In addition, most MFIs do not prioritise financial services in the same way as the poor.

Very poor people generally require financial services with a greater emphasis on savings and insurance than on credit. There are a number of other local semi-formal microfinance initiatives which are similar to VS&L groups such as, for example, rotating savings and credit associations and credit unions.

CARE’s code of conduct in Microfinance

CARE has been active in promoting microfinance throughout Asia, Africa, Eastern Europe and Latin America for many years. Given the scale of CARE’s microfinance activities and the potential vulnerability of the poor people we work with, CARE has designed a consumer protection code that is aligned with our basic programming principles.

The code is intended to protect the rights of our clients and partners, and ensure that they are treated with dignity and respect and at the same time provide them with the highest quality products and services.

Any partner that receives funding or technical assistance from CARE for microfinance activities is expected to adopt and implement a code of conduct aimed at fostering transparency and protecting its customers. The basic principles of CARE’s microfinance code of conduct, shared by CARE and our partners, are as follows:

  • Ensure that clients have a complete understanding about the true costs that they are paying on loans and other financial services and the return they are receiving on their savings.
  • Ensure that if a loan application is denied to a client, the reason is clearly explained to him or her.
  • Ensure that staff are respectful to clients, do not exploit them and do not use violent or harmful practices in loan collection.
  • Ensure that clients avoid investing their loan in business ventures with no prospect for profit to ensure that clients are not deprived of their basic survival capacity as a result of repaying the loan.
  • Ensure that financial services are fairly priced and that the cost of services is not exorbitant and comply with local industry standards or practices.
  • Educate clients on financial management and ensure that clients and their families benefit from the services they receive and do not become over-indebted.
  • Ensure that loans that fund unsustainable environmental practices are not supported.
  • Ensure that clients are aware of their rights and that a formal and transparent mechanism is in place to handle complaints and disputes.
  • Ensure that all clients are treated with dignity and respect.
  • Ensure that sensitive information regarding clients is not disclosed to a third party without prior written agreement from the client.
  • Ensure that the interest of the clients is always safeguarded and in no case encourage any business deal that undermines the client’s control over the business transaction.
  • Ensure that no person is denied access to financial services based on sex, race, nationality, ethnicity, class, religion, age, physical ability, sexual orientation, caste or beliefs as long as it is not in conflict with national procedures and regulations.
  • Ensure that clients do not promote the use of child labour that is children’s work of such a nature or intensity that it is detrimental to their schooling, health and/or development.

In all cases CARE will regularly work with partner microfinance institutions to ensure that the consumer protection code of conduct in microfinance is being adhered to.

Fair charges and Ethical Lending

Lendwithcare only partners with those microfinance institutions (MFIs) that charge ‘fair’ interest rates (or other charges) and we also promote an ethical lending policy. MFIs must meet our eligibility criteria in order to become a partner.

Although solid financial performance is among the requirements, paramount importance is given to a strong social development mission, which includes targeting low-income populations who are usually excluded by commercial banks.

We regularly check to ensure the interest rates that MFIs charge are ‘reasonable and fair’ according to the local context, which often includes providing very small loans to isolated rural borrowers.

Although it is impossible to screen each and every loan that a partner MFI disburses, we do carefully review each loan featured on Lendwithcare to ensure the recipient business is socially responsible, ethical and not damaging to the environment. In this regard, we will not promote loans that, for example, involve poor animal welfare, such as caged egg production, or are environmentally unsustainable.

At the same time, we proactively encourage loans that, for example, create employment opportunities for the very poor, promote sustainable agriculture, recycling, and renewable energy and energy efficiency.

You can find detailed information on each of our Microfinance Institution partners, including the interest rates charged here.