In early 2018, Mr Bandu Vithanage (BV), a former public officer turned social activist who has promoted social mobilization/empowerment and mutual help activities in Kombala and Mayakaduwa, two adjacent villages in the Imaduwa Divisional Secretariat Divison, approached I/D/E/A/S with a request for financial assistance to improve and expand the local- level businesses of 9 small scale entrepreneurs in the two villages. These entrepreneurs were members of Jana Sarana Samithiya (JSS), a local voluntary organization engaged in promoting socio-economic activities in 4 Grama Niladari Divisions.
The total cost of the 9 individual projects plus an institutional investment requested by the JSS secretariat to upgrade their stock of furniture and supplies that they rent out for community purposes was Rs 725,000. The assistance requested from I/D/E/A/S for the 10 sub-projects was Rs. 500,000, with the difference of Rs 225,000 being contributed by the applicants themselves as down-payment.
The requests included assistance for purchase of woodworking machines, grass cutting machines to support livestock rearing, welding plant, comprerssor, cement block-making machine and a sound system, furniture and tents to be hired for local ceremonial occasions.
Following a site visit and project appraisals by an I/D/E/A/S team, it was decided to support these requests and provide funding of Rs 500,000 on a 50% grant-50% loan basis. As usual, the loan was totally collateral-free and interest-free. The JSS undertook to repay the Rs 250,000 loan component in 10 monthly installments of Rs 25,000 each.
In light of the transactional burden involved in dealing individually with 9 individual entrepreneurs, it was mutually agreed that I/D/E/A/S enter into a single composite agreement with the Samithiya. JSS thereby assumed responsibility for disbursing the relevant funds to the different beneficiaries and for managing and monitoring project execution, reporting project progress, and ensuring timely repayment of the loan.
The desired equipment was rapidly put to good use by the beneficiaries. Site visits indicated impressive performances, confirming the boost to their earnings and livelihoods. Repayment of the Rs 250,000 loan component was successfully completed ahead of the agreed schedule. The reliability of these people in repaying their loans in advance, even with zero collateral, is to be highly appreciated.
