MICROCAPITAL STORY: Barclays to Donate $20m to expand its Microfinance Pilot Program in Uganda in collaboration with CARE International and UWESO

Barclays bank has announced a three year, USD 20 million funding plan to support microfinance programs in ten countries across Africa, Asia and Latin America. The program will include the expansion of existing community-based financial services, as well as the introduction of new microfinance programs in collaboration with CARE International, Plan International and Accenture consultancy firm.The funding plan will focus on expanding Barclay’s community finance pilot program originally set up in Katine, Uganda with CARE International. The program has focused on Village Savings and Loan Associations (VSLAs). The scheme was originally developed by CARE Africa over 17 years of research and is based on individual deposits and consists of holding community funds for members’ unexpected bills and expenses.

The 20 million dollar donation will build on Barclay’s past work in Katine by working with CARE as well as the Uganda Women’s Effort to Save Orphans (UWESO) a Ugandan NGO, as implementation partners to help establish 200 more VSLAs across the town and other parts of Uganda. Using the methodology developed by CARE, UWESO will assist the inhabitants in forming the small groups in order to operate within the VSLA framework. Barclays is also rapidly expanding in Uganda, and hopes that the philanthropic program will cause the members of these community finance programs to one day graduate towards the commercial sector for their credit.

The partnership between Barclays and Care International supports CARE’s Access Africa program, which has a goal of providing financial services to 30 million people in Africa over the next 10 years.

CARE International is a global NGO with poverty reduction programs aimed developing women’s economic capabilities. Founded in 1945 and originally established as a means to send supplies to post-war Europe, it has evolved into a large-scale humanitarian organization. It works in 71 countries around the world and in 2007 reported assets of USD 351.5 million. CARE reports to the MIX microfinance information database, and their past affairs in Africa have been reported by MicroCapital here.

Barclays Plc is a British bank which dates back to 1690. It reported annual assets of over USD 1.82 billion in 2007. The bank entered the microfinance sector in 2005 via a pilot program in Ghana based on the African Susu form of income collection. The pilot set up specialized bank account for Susu collectors and provided capital for on-lending. It also provided training programs for collectors and financial education programs for Susu clients. Barclays is currently developing a microfinance policy for the expansion of the bank’s microfinance activities in the upcoming years. Its goal is to create more financial inclusiveness through an adaptation of their own services to fit the specific areas where they operate.

By Yrenilsa Lopez, Research Assistant

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