Entrepreneurs across Afghanistan use small loans to expand their business and improve profits and prospects
20 FEBRUARY 2013 | KABUL, AFGHANISTAN
For Shamim and Mohammad Hafiz, microfinance is a business partner that they cannot do without. Each received a small loan to expand their business and each says the capital made a big difference to profits and prospects. Small loans can bring about big change. Small businesses often need just a small amount to implement big changes and bring their businesses to a sustainable level.
Shamim, who runs one of the few gyms that exclusively serve women in the Afghan capital Kabul, bought more exercise machines and upgraded equipment. She says she’s been able to raise membership fees on the strength of offering “new and better equipment.” Ninety other women-owned businesses were given similar loans.
Mohammad, who sells motorcycle spare parts, used his 2,000-dollar loan to add inventory. “Now, I may not have to turn customers away because I have stocked up on parts that they need,” he says.
Shamim and Mohammad are just two of 254 entrepreneurs helped by microfinance company Oxus Afghanistan with USAID support. Small businesses in Balkh, Faryab, Herat, Jawzhjan, Kabul, Parwan and Takhar received loans ranging from $200 to $13,500 over a three-month period starting in June 2012. Nearly 350 new jobs – 95 of them for women – have been created as a result.
“The loan process was fairly easy,” says Shamim. “Start-ups like mine have a slim chance of succeeding if there is no financing support. Banks require big collaterals and a bunch of documents, which I cannot produce at this time.”
Mohammad says he plans to get a bigger loan once he pays off this one. “I have bigger plans,” he says confidently.
Last updated: January 03, 2014