loans

UPDF Loans given   cont..

In its first two years, the UPDF has operated with a small capital of $100,000 drawn mostly from donors, and so far has extended community-loans to two collaborative relocation housing projects, one income generation project and one city-wide decentralized revolving fund loan through the districts.  Here are a few details on the 3rd and 4th loans. 

Fish-processing income generation loans in
Roessei Keo District

Family in Roessei Keo 
sorting fish

SDI Shawn from South Africa
talks kids in at the fishing 
village in Cambodia

The UPDF's third loan took a detour from house-building into the pungent, salty realm of income generation and fermented fish. 

Through the federation's very active women's group in Roessei Keo District, 356 families in 19 river-side communities took loans to purchase all the equipment, crocks and riel fish necessary to make prahok, the ubiquitous Khmer-style preserved fish.  In six or eight month's time, the fully ripe prahok comes out of the crocks and goes to market. 

The loans are scheduled to match this ancient cycle :  during the five or six-month fermentation period, families pay only the interest on the loans, and when the prahok is sold, they repay the loans in full, or in a few very close repayments, all within a one-year term, from loan to full repayment. 

The 1999 - 2000 batch of loans for making prahok has been very successful, and all but three of the 19 communities have repaid the loans in full (the three river-side communities having trouble repaying were badly hit by the serious flooding this year, and are now struggling to repay the khan.) 

The project has been so successful, that a proposal for another round of loans has been submitted to UPDF for the 2000 - 2001 prahok season, this time involving 307 families in 19 communities, asking for a total of US$ 43,000 (about $140 per family).   

Decentralized revolving fund loans to each of the 7 district federations

District Chiefs from PPM
 in discussions with the 
SUP Fedaration

During the months of May and June, 2000, the first experiment in devolving the UPDF loan process to the city's seven districts began with a pilot scheme to let each of the federation's seven Khan Units (district-wise sub-federations) propose loans, up to a ceiling of US$ 5,000 per each Khan. 

The idea was that the UPDF would extend up to $5,000 to each Khan, which would then on-lend the money to savings groups members at a slightly higher interest rate. 

The proposals would have to go first through the Khan Unit, then through the district CDMC as a check, and finally to the UPDF Board.   Between May 25 and June 23, each of the seven Khan units worked very hard to open their own common bank account for all the savings groups in the district, and to hold a series of meetings and surveys to decide who would get loans and for how much. 

The rather small $5,000 ceiling was an intentional strategy to encourage the federations within each district to prioritize needs and ideas of member communities and individual savings members. 

 

Other pages on CAMBODIA  
Cambodia Summary    Urban Poor Development Fund    Diary of a Relocation   HUN SEN Meets SUPF