What We Are Addressing
Our company addresses systemic financial discrimination between micro-entrepreneurs and other groups of entrepreneurs including small, medium and large entrepreneurs in Mbarara City.
We selectively serve small local business owners, most of which do not qualify for loans in well-established financial institutions due to lack of collateral or security. Some do qualify for the loans in the banks where the interest rate is lower, however, the rates are still between 16 to 26% annually. This creates an excessive load for someone attempting to create a small business. They also noted that the process of evaluating an individual for credit worth is very difficult and added that even the process of assuming risk management using existing financial institutions is also costly because of monitoring, loan application, loan processing and evaluation fees.
In addition, the consulted market vendors mentioned that they are exposed to individual money lenders who are not registered and seem to have an easy process of offering loans, but their interest rates are as high as 20% a month, which has trapped some of them in cycles of debts.
From the above mentioned, we realized an opportunity existed to serve the affected population by creating a credit company that is mission-driven for profit that can provide low-interest small loans without collateral to improve the livelihoods of small business owners who could not qualify for loans from well-established financial institutions.
Our Target Audience(Who we are addressing)
Our targeted clients are adults of 18 and above years who own their own businesses with the operating capital between 290,000-1,820,000ugx, eventually hoping to engage adults who want to create a business, but do not have the finances or the expertise to begin. We would really wish to support clients above the figures mentioned but we do not have enough resources to make it happen.
Ever since we started our program, we have not advertised but our service demand has steadily increased simply by word of mouth. This increase has risen to an extent that we cannot support due to limited resource. Our clients tell their friends about our services and they walk in to make consultations and requests.
To date hundreds of small business owners have reached out to us for assistance, but we have only managed to recruit very few clients in our program. Using small loans from friends we have gradually built our program to a current total of 85 clients. While we have only a limited number of participating businesses, we still have a very satisfied, and happy clientele.