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Wu Feng Xiang

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Meet Wu Feng Xiang – an extremely busy and well respected lady in Ruoli village, Central China.

We meet her as she is checking her micro-credit books before going out to collect repayments on the micro-loans given to her fellow villagers in collaboration with BESTSELLER FOUNDATION’s implementing partners.   

A well respected ‘loan officer’
When the villagers were introduced to the new microcredit scheme, her fellow villagers unanimously elected her as their ‘loan officer’ and a member of the new micro-credit committee.

Wu Feng Xiang is responsible for the administration of the small but ‘favourable’ loan scheme – which is now available to Ruoli villagers with help from BESTSELLER FOUNDATION.

 The micro-credit scheme is unique, because it gives poor villagers access to small – yet important – loans which they would otherwise never get access to. 

Self governing micro-credits
Wu Feng Xiang explains that most banks in the rural areas require the loan takers to provide security in return for obtaining the loans.

Very few of the poor villagers are able to do this, so even the most hardworking and willing farmers have little chance of obtaining loans that could help increase their income and living conditions.

Therefore, BESTSELLER FOUNDATIONs local partners has established a self-governing micro-credit facility which works the following way

The process

  • Women must form groups of minimum five (5) to obtain a loan (even if the loan is for one person only). This way all five women - and their households - cover collectively if one of the loan-takers fails to repay their loan.
  • The ‘Loan Officer’ checks if all the required papers for the loan are in order and asks the micro-credit committee for pre-approval
  • The micro-credit committee forwards the ‘pre-approved’ applications to Jinguyan County PAO  (BESTSELLER  FOUNDATION’s partner)
  • The county PAO (the one managing micrco-credit schemes in the areas) approves or rejects the loan application.
 The best is that the microcredit has helped increase the villagers income. It has given the struggling villagers a small economic incentive to remain living in the rural area with slightly improved lives. 

The cycles
Currently, Wu Feng Xiang administers and liaises with 21 ‘borrowers group’ consisting of  93 individual members.

To build routine and credibility in the loan taker - women (and their household) are only allowed to borrow 5000 RMB in year 1. In the second year they are allowed to borrow 6000 and in year three, they are allowed to borrow 8000.

Wu Feng Xiang explains further, that the micro-credit the currently has 288,000 RMB (xxxx USD) in circulation. So far there has been a 100% re-payment rate. The loans have a 1% interest rate per month – resulting in 12 % interest rate annually.

Increasing income
The level of income has increased due to the microcredit package which was introduced by BESTSELLER FOUNDATIONs local partners.

The loans have helped people to scale up their animal breeding of goats and donkeys – and helped them procure high value seeds or fertilizer that can improve their farming activities – and maximize their profit.

The microcredits give the challenged and poor people an extra incentive to stay in Ruoli. In the past 20 years, re-occurring droughts and difficult living conditions have forced hundreds of villagers to move to more favorable locations.