Turning Loans into Savings

CWS Indonesia | August 26, 2019

Reni tends her home garden which she started to help diversify and grow her income. Photo: CWS

Reni fries doughnuts every morning to sell in her cafe. Photo: CWS

Reni Sattu and her family live in a rural village about 25 miles from the nearest town. Among other services she has no access to, safe banking is one. And, as she learned when she approached a bank in a bigger city, she could not borrow money from them anyway because her husband’s income barely paid family’s daily bills. So, some years ago, when she was eager to start her own business – a small home-based café – she turned to informal lenders, who many people refer to as loan sharks. She knew these sharks would only bring her trouble, but it seemed she had no other option. For five years, Reni Sattu borrowed money with high interest rates to build and run her café. But, after all her efforts, and customers, she felt like she was going nowhere except around in circles to pay the interest on her loans … and never turn a profit. “There was a time when I had to pay back about 100,000 ($7) Rupiah a day in interest whether I made any money that day, or not. It felt like torture”. So, after struggling for years, Reni decided to close her café.

Fast forward to October 2018, when Reni joined the aptly named, CWS supported, DREAM initiative for disaster risk reduction through enhanced adaptive measures, which supports women farmers and small business owners to organize savings and loans groups so they can support each other as they adapt to changing socioeconomic times due, primarily, to climate change effects on rural farm life.

Soon after joining her group, Reni applied for a loan to realize her dream to re-start her café. “I never knew getting a fair loan was possible. With our interest rates, I can make the loan payments, add to our income and, more importantly, I can save too!” With her newfound sense of security, Reni says she feels well able to invest in the wellbeing and education of her family, and their better future is her latest dream.

While for Disaster Risk Reduction Through Enhanced Adaptive Measures was designed primarily to help women and families improved their agriculture-related income from climate adapted home gardening and poultry raising, CWS is pleased to see that the Women’s Savings and Loans Groups have taken members who work about farming so their engagement can add to overall community strength, which will add to collective resilience for continuing slow onset climate related disasters as well as any sudden onset ones.

For more information contact mkoeniger@cwsglobal.org

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