Headstand Media Bank of Hope
One of the things that Headstand Media decided to do to celebrate 2010 and “give back” for a good year of business growth, was to partner with Hope International and sponsor a “Bank of Hope” in the Dominican Republic. A Bank of Hope (Banco de Esperanza) is the basic loan product that Esperanza (Hope’s DR partner organization) offers to poor entrepreneurs in that country.
What is a Bank of Hope?
A Bank of Hope usually consists of 20-30 poor entrepreneurs, who are called associates, and who are almost always women. Associates typically all know each other and live in the same neighborhood. Each member of the bank has been approved by the rest of the associates, and each member commits to co-guarantee the loan of all the others. Since their own money is on the line, they take care to only permit responsible associates to join the bank.
The banks are also organized into smaller subgroups of 5 people. Each group elects a group coordinator, who is responsible for collecting and counting the loan payment from the group and making the regular payment to the Banco de Esperanza loan officer. From the handful of coordinators, the whole bank elects a president and a secretary. This structure encourages responsibility and empowers women to become leaders within their communities.
An Esperanza loan officer travels to their community to meet with the bank every 2 weeks. The meeting most often takes place in the home of one of the associates. The associates normally all live within walking distance of each other. It’s pretty common to see them carrying a plastic chair to the meeting so they’ll have somewhere to sit. During the biweekly meeting the associates make their loan payments. The loan officer has a strong relationship with the associates – he or she has trained each of them in basic financial and business skills before receiving their loan (for example: basics of marketing, budgeting, bookkeeping). The loan officer also has visited the home of each associate to get to know them better and assess their level of poverty.
Who Does it Serve?
Specifically, the Headstand Media Bank of Hope serves the community of Batey Baigua in the province of La Altagracia. This area is quite far into the countryside, more than an hour drive away from the nearest Esperanza branch office in La Romana. The community is a batey, which means it is a community on or near a sugarcane plantation. These types of communities are the poorest in the DR.
To date the Headstand Media Bank of Hope has dispersed funds to 10 women with names like: Gladis S., Marcia B., Francisca P., Altagracia C., Marie A., Tomasina G., Gela P., Cecilia P., Zobeida P., and Madame B. We are honored to be helping these first 10 women and wish them every success in their endeavors.
Headstand Media’s Involvement and Interest
Headstand Media is honored to be partnering with “Esperanza” through Hope International. Our initial capital investment is funding this particular Bank of Hope, which will in turn make micro credit loans to the kinds of individuals, entrepreneurs and small businesses in the DR as described above. The goal and actual outcome of this type of micro-lending institution is to help people out of poverty by growing the local economy and lifting the standard of living not only for the associate, but for their family, village and town.
We see this program as free market economics and entrepreneurship at its best and doing its highest good: alleviating poverty. What is attractive about this kind of innovative approach is that it is sustainable. It attempts to solve an economic problem through good stewardship, opportunity, creating wealth and growth for very poor people, rather than through short-term hand-out rescue aid that all too often creates an unhealthy dependency. Although there is a need and a place for aid, especially in cases of crisis and disaster (Haiti, Japan, Katrina), the answer to long term poverty is by creating opportunities to create wealth… including the very poor.
Tracking the Progress
One way that Headstand Media will stay in touch with the Bank of Hope is through a web-based microcredit management system provided by Hope International and Esperanza (see the screen shot). This web portal allows us to track:
- Disbursement history
- Financial summary
- Clients report
- Business types
- Loan product
We will post regular updates here on Blogstand as we learn more about the individuals whose lives are impacted by the Headstand Media Bank of Hope, and the stories of life transformation that we hope to be the result.