I had an interesting chat last week with a lady from Uganda who is trying to expand her microfinance programme into northern Uganda. It’s an area devastated by 20 years of civil war. Most of the population suffered terrible trauma – children abducted to become child soldiers and forced to commit atrocities against their own villages, women and girls raped, people losing their homes, land and loved ones. Many of the population spent years in IDP (internally displaced people) camps and became accustomed to ambush, attack, violence – and NGOs. With no way to earn a living, most become dependent on international aid.
Then the war ended. The majority of the NGOs left, and the government disbanded the IDP camps. Trouble was, many people had no land, homes or businesses to return to. A whole generation had grown up in the camps with little education and no handed-down skills of how to farm the land. Add to that community conflict and post-traumatic stress disorder along with continuing land disputes, and the outlook for stability and peace was poor.
Here’s where microfinance comes in. Its group structure nurtures trust, accountability, co-operation and democratic participation. Its business training makes up for lost education. Its capital offers households a chance to start again, to rebuild a business and start to provide for their families again. And crucially, this gives dignity, confidence and cohesion to communities which have long lacked all of these. It’s not just about providing financial services, badly as these are needed, said my Ugandan friend. It’s about providing education and self-belief.