Micro-credit helps many Moroccans escape poverty
2006-11-03
Microfinance is thriving in Morocco. Poor people who cannot qualify for traditional loans can now start businesses with micro-credit loans.
By Sarah Touahri for Magharebia in Rabat – 03/11/06
 [File] Soudoji opened his babouche (slipper) shop using micro-credit. |
With the help of low-interest micro-credit loans, many poor Moroccans, including women and people from rural areas, have been able to escape poverty and start their own businesses.
Presently, 12 micro-credit associations exist in Morocco. With help from the UN Development Programme, the US Agency for International Development and other organisations, thousands of loans ranging from 500 dirhams to 50,000 dirhams have been granted. Clients must have a median household expenditure of no more than 2,500 dirhams.
Jihane El Gueddaoui, an Al Amana management attaché for the promotion of micro-enterprises, told Magharebia her association aims to reach more than 500,000 households by 2009. After some beneficiaries complained about the small scale of the loans, the credit limit was raised to 50,000 dirhams.
She says Al Amana is particularly interested in reaching the rural poor.
"The introduction of micro-credit in rural areas is still largely limited to craftsmen, smallholdings and other services, while the potential for financing classic agriculture remains enormous," she pointed out.
According to the National Federation of Micro-credit Associations (FNAM), micro-credit associations' rural clients represent just 34% of the total, though eligible clientele is ten times greater than in cities.
FNAM says the number of loans is continually increasing and has already changed the lives of many Moroccans, even though micro-credit is relatively new in Morocco. While micro-credit loans have existed since the 1970s, they did not begin in Morocco until 1993.
When the income of Hadifa Herrat's husband could not meet the family's needs, she applied for credit from Al Amana. She obtained 3,000 dirhams, which allowed her to buy merchandise for her new clothing business.
"My introduction to the world of business was not easy, as I have always been a housewife. But the start was the hardest part. Now, I'm helping with family expenses," Herrat says proudly.
Others have been able to combat unemployment thanks to micro-credit.
Noureddine Soudoji, an 18-years-old, used a 4,000-dirham micro-credit loan two years ago to open a now flourishing traditional babouche (slipper) manufacturing shop in Rabat.
Soudoji says, "I've been able to make a success of my professional life, having failed at school. Thanks to a friend, I learned about the association that changed my fate."
He hopes to get another loan to expand his business and continue on the path to success.
Morocco is now cited as a successful example of micro-credit and is already serving as an example for other Mediterranean countries.
Moroccan sociologist Rahim Chabour says, "By giving disadvantaged people access to micro-credit, you strengthen their ability to increase their revenue and encourage their participation in the national economy."
The World Bank estimates over 7,000 microfinance institutions serve around 16 million poor people in developing countries.
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Vivek Posted 2006-11-03
Microfinance is a myth. If you really want to present a viable solution to eradicating poverty look into the work of Dr. Abraham George. Below is a link to one of his articles published by Wharton Business School. http://knowledge.wharton.upenn.edu/india/article.cfm?articleid=4114&specialid=1&CFID=1824805&CFTOKEN=37907590
محمد المختارl Posted 2006-11-06
Thank you for this show!
ليلى Posted 2006-11-16
Great, you’ve served the nation.
moufadel rachid Posted 2006-12-05
Is "Mukawalti" affordable to all youth without any problems? and what are the steps to be taken in order to benefit from it?
محمد Posted 2006-12-14
A good initiative to promote the employment in Morocco and open work opportunities for young graduates.
نادية ليخيي Posted 2006-12-20
Thank you for helping the youth!
denna hicham Posted 2006-12-23
I would like to do two things. First, help all young Moroccans get a job in Morocco, more generally work for the well-being of mankind. Second, trade with some young Moroccan in the field of motobikes.
محمد حفظ الله Posted 2006-12-29
Thank you for this unique and only solution that would allow many young people to create even a modest simple business. But does your program provide support to interested candidates. I am trying to get a loan but could not find out how and where? Thank you!
nekhla hicham Posted 2007-01-21
"Banque populaire" of small loans is one of the leading institutions in this sector. It has contributed effectively in fighting poverty and exclusion in Morocco. It achieved impressive results in 2006 in reaching out to poorest social classes and the needy in 2007.
بيي الحاج Posted 2007-02-23
This prevalent program, according to many, has made the poor poorer because these people end up selling their furniture to pay off the business loans!
ahmed abd almotalib Posted 2007-03-04
Medical initiative to revive employment in Morocco and open the doors for degree holders to get jobs!
نادية المهداوي Posted 2007-04-18
A practical initiative and in order to make it succeed it needs more than sociologists
abdelhak anzar Posted 2007-05-13
I don't agree with the one who said that micro-credits are a myth
عمار Posted 2007-06-05
Gold doesn't fall like rain- you should work instead.
فاطمة Posted 2007-06-17
I'm wondering if 4000 dirhams are enough to open a shoe store, and how can poverty or unemployment be fought through small loans.
ismail Posted 2007-08-25
May God guide you, you have ruined us.
تنغاااا Posted 2007-09-19
"God will deprive usury of all blessing, but will give increase for deeds of charity".
tchikivara Posted 2007-10-14
This is better than nothing. Anyway, micro-credits are better than nothing. But the problem is that there is some kind of risk in this.
yasin Posted 2007-11-10
This initiative targets everyone who has an economic spirit, traders and craftsmen not people who have no experience in buying and selling and in the craft. And when they take the money, they do everything they want, and once time comes to pay back, he’s powerless. Firstly, these micro-credit institutes should coach these people who are its customers and train them so that they benefit mostly from these loans which they give them. They shouldn’t consider them mere customers, because profit isn’t in the interest they get from the loan. The objective, as in the reality, isn’t profit but to fight poverty and everything associated with the social burden of the people.
هناء Posted 2007-11-13
How can I benefit from the micro-loans, and what are the conditions to get loans?. Thanks for your help and your reply.
klk1 Posted 2007-11-23
Listen here, my brother, you are just saying a bunch of whatever!!! All the customers, whether from Zagora, Al Amanna, the BP Foundation, FONDEP or I don't know what others... are being given a rough time by this!! That is how I see it! They are obliged to pay even if they do not have the means. And, if you think that with a 12 per cent interest on what they borrow you are going to help them… well, you should know what the hell you are doing to them. And, I am speaking with some knowledge about this: I was an employee with a microcredit establishment for four years!!! I do not think that you are able to understand what is really happening. And, as for the numbers these bastards would like to reach, it is going to be on the backs of the employees, because you are obligated to meet their goals and if you are not able to then you are fired. So, you have to look for clients whether they are able to pay or not. The employees at any given establishment or business could frankly not care less. For them what is important is to make the numbers. In this case, dear sir, we are talking about neither economic development, nor social integration, nor establishments and businesses towards some lucrative ends! No, we are talking about commerce; buying and selling. For the people in charge what counts is to have more clients, which equals more profit. What these bastards are looking for is to increase their capital. I am sorry, but as I see it I am rifled with such guilt. Why did I ever work in a credit business establishment. I now see people selling there televisions. I see women getting screwed over while these men go around with God knows what! I am really ashamed!!! And these small-loan establishments should be ashamed too, because they are making people do whatever it takes to pay back their loans, knowing full well that the funds and capital at the heart of these establishments are donations!!! For shame!!!
siham Posted 2007-12-01
I'm a student at the second year university. I have many projects to which I did field studies. But I cannot found any of them in reality, so can I get a loan to start knowing that this project guarantees an income to many people.
رانية بولحرش Posted 2007-12-16
I think that these associations work on reducing uneployment as they work on helping them.
jalal Posted 2007-12-16
The objectives of this association are filthy, its objectives are impoverishing the poor.
نادية Posted 2007-12-24
I felt the urge to say a few words on the subject because I am one of those who still experience the unfortunate loans disaster. My husband is a civil servant. He made the biggest mistake by taking a loan to address his financial crisis. Naturally no one can imagine the serious financial problems we got ourselves into. Now we cannot even put food on the table. I strongly advise anyone who thinks debt is a solution, against taking that step. Finding an interest free loan is perhaps much better. I think that these institutions live off the blood of its customers and exacerbates their ordeal. This is a heartfelt recommendation to anyone who might bury themselves in the quagmires of loans.
moi Posted 2008-01-10
Institutes for sucking the pockets of the poor
moufadel rachid Posted 2008-01-26
Unfortunately, Mukawalati program is just scorning young people. Those who have benefited are those who have power and favouritism…While they put hurdles in the face of poor young people… Even what they called National Initiative for Human Development is just a media clamour to mislead the public opinion…And who is the winner, rich people who have power…So what’s the share of poor people in their country Morocco just to breathe oxygen…By the way it is the poor class which protects Morocco...What good can be expected from those who take their money to America and Switzerland...They're just traitors to God and the country.
hafid Posted 2008-03-18
I think it is very interesting to talk about this subject in a forum, being that Moroccans as a whole do not know what micro-credit is. The exception is credit agents, and all of their strength is required to integrate the several people and families who are economically poor with regards to our economic fabric. As a credit agent, I see the dynamic fruit micro-credit has borne.
moufadel Posted 2008-05-05
As an agent of a credit institution, which economic tissue are you talking about? Do you consider sucking blood an economic improvement…? By the way, all Moroccans without exception know the micro-credits… The only concern of credit agents is to catch new customers in order to get a higher rate in their favour… I speak from the viewpoint of someone who shared the experience… as a university graduate. Micro-credits are just a poisoned needle put in place by some people who have capital in your hands with the assistance of the state to swindle young people… For two reasons, the first is to steal ideas and projects; and the second is to get rid of them in a skilled way… Go down to field to see Mr Agent… Everything is meant to scorn people unfortunately.
محمدالباشا Posted 2008-05-09
To sum up, if you want a life with loans, you will be busy only with loans. Honestly, these associations only serve their interests more than anything else. As regards the poor who didn’t get the help of public institutes, they cannot expect private institutes to help them, it is they who help the institutes; these institutes were created from them. People are enduring a serious crisis. Those who take loans in order to repay another loan at any price should reconsider this project before granting the loan you must study the plan of the beneficiary to make his project succeed and after you receive the interest handle the project to his owner…
البشير Posted 2008-05-09
Micro loans help the poor to reform their living but they make them suffer under the burden of interest which prevents them from going on in reforming their living because the interest rate is very high.
مونى Posted 2008-05-19
I have a store and I need help in establishing a project in that store. I only have the store I mentioned. Please reply soon. Greetings.
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