Aid in Action

Micro-Credits Bring Business Back to Market

With a $50,000 grant from USAID, the Youth Branch of Muhammadiyah in Banda Aceh restarted their revolving loan fund.

Mohammadiyah, Banda Aceh | Saturday, May 14, 2005

With a $50,000 grant from USAID, the Youth Branch of Muhammadiyah in Banda Aceh was able to recapitalize and restart their Syariah revolving loan fund. The fund now provides working capital for over 200 micro-enterprises affected by tsunami. Approximately 80% of these funds have already been disbursed to micro-businesses involved with the sale of cooked food and drink, vegetables and fruit, children’s toys, and clothing. 30% of people receiving loans are women, and repayment stands at 100%. The average loan to borrowers is between Rp 1 million (USD 105) and Rp 2 million (USD 210). The local government is very please with the program as it is the only facility providing vital "seed money" for micro-entrepreneurs to get back to business.