Recovery Lending for Resilience
Recovery Lending for Resilience
With our clients affected by COVID-19 and the long road to both health and economic healing, our recovery lending strength has never been more critical for VisionFund’s clients and microfinance institutions (MFIs). With the right microfinance products and careful situational analysis, clients, their families and MFIs can thrive in the recovery phase of this disaster.
VisionFund is taking an approach where we put our clients first, by launching the three-year, $55 million Recovery Lending for Resilience Program. Recovery loans help the vulnerable poor and keep them from falling into extreme poverty as they respond to the economic shocks stemming from disasters like COVID-19.
The World Bank estimates the COVID-19 pandemic could push an additional 88-115 million people into extreme poverty with the total number of people living in extreme poverty rising to as many as 150 million in 2021.
The Recovery Lending for Resilience program focuses on supporting the ongoing economic recovery of rural farmers and small businesses, urban microbusinesses, and savings groups. We are working towards recapitalizing savings group members who have depleted their savings and help them reignite farming and business activities to recover their livelihoods.
Whereas other MFI’s think post-disaster lending is risky, VisionFund has actually seen high rates of post-disaster loan repayment. Recovery loans are both ethical and a wise business initiative.
Together we have the chance to end extreme poverty. This is our chance to help millions of people - particularly women - recover from the economic impacts of disasters like COVID-19.
Our Approach
VisionFund believes that, with the right microfinance product and careful situational analysis, both families and MFIs can thrive in the recovery phase of a disaster.
By restructuring old loans, distributing new loans, and helping clients develop new business plans, VisionFund is changing the traditional microfinance mindset by proactively making new loans during times of crisis. Such loans in the market mean more families can begin rebuilding their lives with the finances they need, while keeping VisionFund’s microfinance institutions strong.
In previous disaster responses, we have even seen higher levels of loan repayments from those recovering from crises. Loyalty and trust are built as we stand with clients amidst their storms. We see new markets established through more disaster-resilient small enterprises.
Loans
The recovery lending approach financially empowers individuals and groups to restore livelihoods, markets and value chains by providing meaningful amounts of finance to restore an economic activity; or diversify to a new one if needed.
Savings Group Loans
Savings Groups - informal community groups where members accumulate and convert small amounts of cash into savings - are a focus for VisionFund's Recovery Lending for Resilience program, where loans to the savings group's cashbox are changing the lives of its members.
Digitisation
To reduce face-to-face meetings, reliance on cash and lending costs, the Recovery Lending for Resilience program is accelerating our ongoing investment in digital and mobile technologies.
Empowered Worldview
The Empowered Worldview model will train our staff and clients to promote a shift in mindset - from dependency to empowerment and resiliency.
Meet Marie
COVID-19 threatens to reverse the progress VisionFund's clients have made over the years. VisionFund is ready to respond with recovery lending, helping clients rebuild their businesses and communities on their journey out of poverty.
VisionFund is World Vision’s financial services provider offering small loans, savings and insurance to people like Marie who could lose everything because of COVID-19.
This is Marie's story.
Learn more about the countries we are working in.
Democratic Republic of Congo
Learn about the recovery lending for resilience work happening in DR Congo.
Resources
