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USAID/Chevron Partnership Spurs Start-Up of a New Bank
In 2004, USAID and Chevron joined with others to help to establish NovoBanco, Angola's first and --thus far-- only bank dedicated exclusively to serving the financial needs of micro and small entrepreneurs and households. When USAID assistance ended in September 2006, Novo Banco had three branches (two in the capital province of Luanda and one in the coastal province of Benguela), 100 employees and plans for the future that include having 8 to 10 branches and 300 employees by 2008. Today, two short years since the bank opened its doors, it is thriving. It has extended approximately $20 million in loans and served almost 20,000 customers. Its August 2006 balance sheet boasted a business loan portfolio of $7.1 million; 1,995 loans outstanding; and total deposits of $6.4 million.
While NovoBanco's numbers are compelling, it's the people behind the numbers who are the real story. Dona Teresa Alentejo's story is emblematic. She took out her first loan in August 2005. It was $5,000 for the purchase and installation of a small ice cream machine. With the machine, Dona Teresa and her daughter established a wholesale business selling ice cream to the venders who roam Luanda's traffic-clogged streets peddling refreshments to hot and weary drivers. With a second loan, of $25,000 in September 2005, she expanded her ice cream business. Dona Teresa now has 20 employees and recently received her third loan, for $35,000, to expand into a new product line: ice cream cones!
Dona Teresa's story is not an isolated one. Celestina Pedro drew on a $2,000 loan to refurbish her beauty salon. Now, with new customer chairs, wash basins and other tools, she employs six employees. Dona Lourdes Cueia Paulo's needs were even smaller. She borrowed $350 to invest in a shelf that is helping her to more attractively display, and thus better market, her home-made cakes and cookies. NovoBanco has also helped fishermen buy better equipment, taxi drivers expand their fleets, carpenters buy new equipment, educators open small private schools, food wholesalers increase the variety of their products, and women importing clothes from nearby Namibia and South Africa access new styles from as far away as Brazil and China. By adding 'access to finance' to the hustle, innovative spirit and business savvy of Angola's micro and small entrepreneurs, NovoBanco is transforming people's lives and, in the process, making a strong contribution to the transformation of the country.
USAID and Chevron funded the technical assistance and training that helped establish NovoBanco. Chevron also helped to capitalize the bank, along with ProCredit Holding (of whose global network NovoBanco is a member), the IFC, Stichting Doen, and Bio. Given the strong foundation that NovoBanco has built and the strong demand for finance from Angola's capable entrepreneurs, we are confident the bank will successfully fulfill its plans and continue, for many years to come, to help boost the prospects of many who might otherwise not have the chance.
