Background Philosophy

Literacy and formal Education is the main entry of development activities, In view of this, USSA Foundation its all development activities through literacy program here organizing basic literacy courses and awareness programs, USSA Foundation discovered that the economical situation of the poor could not be improved without cash money. This is the reason why USSA Foundation has started its microcredit program in 2023. The program is also meant to create the future financial sustainability of USSA Foundation.

The objectives of the Micro Credit Program are to:
• Alleviate rural poverty by providing loan for income generating activities
• Raise the socio-economic status of rural ultra poor women
• Raise the awareness of the community people about their legal and social rights
• Teach basic skills for undertaking income generating activities.

At first the program was started in Gaibandha in 2013 with 20 development groups then, gradually today’s USSA Foundation has 565 development groups in 10 branches with a total of 7572 members (Report up to September, 2023).

Surce of fund:
USSA Foundation has been running its Micro-credit program out of two different sources:
1. USSA Foundation General Fund, started in 2023
2. Bank Loan started in 2023

Methodology of Implementation

The area chosen by USSA Foundation to implement the Micro-Credit Program would have good infrastructure conditions. Furthermore there should be sufficient market opportunities in the area for beneficiaries to sell their products. The criteria for prospective members to be admitted to a primary development group are as follows:

• Their economical status should be marginal farmer or day laborer;
• They should be a permanent resident of the area;
• They should be excluded from commercial loans;
• Women should be ultra poor;
• The minimum age is eighteen years and also the maximum age should be 50 years old.

After selecting a suitable area, USSA Foundation organizes an initial meeting and provides information on the micro credit program. When enough people show interest, a group of minimal fifteen and maximum thirty members is formed. USSA Foundation’s credit officer guides and observes the development group for thirteen weeks and considers the members’ honesty, sincerity and solidity of family relationships. Here all members of a savings group have to fill out an admission form; the basic information form contains information on the initial economic status of the beneficiary and her or his family.

The group chooses their own president, secretary and cashier and they have to receive a five-day training on leadership and group management for maintaining accounts, local resources, income generating activity identification etc.
On the other hand weekly group meeting is compulsory for each group. Here the meetings include an awareness program. The credit officer gives information and presides over discussions on various subjects like health, education, arsenic, development awareness, sanitation, childcare, divorce, tree plantation etc. After that the credit officer collects the savings money and the installments.

After four weeks, group members are invited to present a loan application for undertaking income generating activities. Together with the credit officer; members select an area of activity. The credit officer advises them on the feasibility of their choice in terms of cost and profit and market opportunities. Once their choice is made, they receive seven-day skills development training. Topics are mostly: cow & poultry raising and rearing, kitchen gardening, plant/seed nursery, fishery and small trades.
The members, assisted by the credit officer, have to fill out a loan application form. The Branch manager then visits the group and writes a report on the members’ loan application. The Area Manager checks this report and sends it for final approval to the head office in Dhaka.

The members have to save a weekly amount of at least 30/= taka. They pay weekly installments on their loans. The interest rate is 24% as on declining method. The grace period is two weeks for micro loan and four weeks for micro-enterprise loan. The savings group meetings are conducted by a Credit officer and held once a week.