Mexico Microcredit Project Successful Pat McCourt - Willcox Rotary Club
go to original May 10, 2012

Microcredit makes affordable small business loans available to owners who have no other source of capital.

The Willcox Arizona Rotary Club for its second time has participated in this international Project through the donation of $1000 in last year’s project; and now in next year’s project. The Fountain Hills Rotary Club heads up the fund raising and delivery of funds to the bank in Mexico.

The Fountain Hills Rotary Club Microcredit project in its second year raised $108,300 for new loans to small business borrowers in Nogales, Mexico.  The average new loan is about $200 so over 500 families will be positively affected from these new funds. Rotarians and non Rotarians from 3 countries, 9 Rotary districts, 32 Rotary clubs, and The Rotary Foundation contributed to the grants.  

A typical borrower has a small, successful business but not sufficient working capital to expand it and no other source of affordable capital. These little businesses have high margins and so expanding the business provides considerable additional income to significantly help the family with nutrition, education, sanitation and living conditions. The typical borrower is a woman with a husband and three children. She will be a member of a borrowing group who all sign a group promissory note. Loans are for four months and the repayment rate is 97%. When all loans in the group are repaid, all are eligible for a larger loan to further expand their business.

An example of a successful borrower from the March 26 Borrowers meeting in Nogales:

Senora Calderon told her story:  "Three and a half years ago, I borrowed $200 to allow me to expand my tortilla business.  I make high quality flour and whole grain tortillas that I sell for $1 a dozen.  I make and sell 70 dozen tortilla packs per day.  My costs are about $30 for the 70 dozen, so I make about $40 per day. I employ one woman on an hourly basis and our work is completed before noon.

By comparison, my husband works all day at a factory in Nogales and he makes $7 a day.  

The extra income we have from my business allows our four children to go to school, my family to eat healthy meals every day, and we have made some important improvements in our home".

In addition to the extra income Senora Calderon has produced for her family, she also hired a local carpenter to build her a special small room on her house that is used exclusively for her tortilla business.  As well, she hired another neighbor to build her a propane-powered tortilla stove.  So in addition to improving life and outlook for her family with her little business, she has provided employment for others in her community too.

There are many examples of the power of microcredit to help these motivated businesswomen and men expand their business and significantly improve the lives and hopes of their family.  

Frequently, the expansion of a small business will provide employment opportunities locally and husbands or sons do not have to travel to the USA illegally seeking work to help support the family.

If you are interested in additional information or participating in this microcredit program in Nogales, Mexico , please contact Wayne Rish at nwrish@gmail.com. All donations are tax deductible and 100 percent goes to borrowers.

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