overview

Empower families to control, diversify, and increase their income. Several families in Pachachaca received loans for $200 as they begin home guinea pig farms.

background

Can you imagine getting one paycheck a year? Could you plan for every event and unexpected expense? Andean families live with this reality. The annual harvest accounts for nearly all of their total income. As a subsistence farmer, drought, floods, and frost and more than inconvenient. They seriously jeopardize the family's wellbeing. Starting a small business opens up a new, more regular income stream and secures against unpredictable climate and poor harvests.

Blue Sparrow's microfinance program began as an innovative way to fund the Conectados computer labs in Andean schools. (Read about the guinea pig microbusiness here.) The benefits were immediately apparent and families wanted to get involved at home. Blue Sparrow supports microfinance as part of a unified strategy connecting schools, homes, and the students in them. One isolated family may not feel confident enough to begin a new business, but as part of a network of entrepreneurs that share experiences and lessons learned, it's easier to get started.

our plan

Blue Sparrow meets and selects families on an individual basis. Depending on the individual’s situation and needs, we refer them to another lender or accept them into our own program. Many microfinance organizations exist in the area, but only accept highly qualified candidates with proven credit history or other requirements. Our focus is on borrowers that are not able to receive other forms of microlending because they lack official identification, government property titles, or previous loan experience. These individuals have the greatest need and least ability to enter the standard bank system. Knowing that these loans carry a greater risk, we stay in close contact with each borrower throughout the loan period.

Currently, the prospective clients are farmers with children who attend school. Their children must be enrolled and actively attending classes. We are making no preference towards genders at this time. Clients must attend all Blue Sparrow and Parents’ Organization (APAFA) meetings and actively participate in the school community.

Many families will choose to begin raising small animals, but other options might include expanding a corner store or other existing business. A new borrower qualifies for a $200 loan on a ten-month repayment schedule, enough to begin a small guinea pig breeding setup. After successful repayment, the next loan amount increases to a maximum of $300. Group lending programs are also available, allowing several people to join together and mitigate risk. If one borrower is unable to repay, the others can temporarily cover their portion until the business is back on track.

future

We will continue to expand our area of work and partner communities. Microfinance is a way to begin a relationship with a community before implementing large scale projects in the area. Donors can sponsor a borrower at our support page and help us reach even more of Peru's neediest entrepreneurs.

support

Why not create a group of friends and fund a loan? Five friends giving a dollar a day can fund a loan every month. Check out more here.
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