Seedbank Microfinance Initiatives
Street Child offers individuals in rural areas the chance to borrow bags of seed, which can be farmed and the surplus sold. We do this by setting the village up with a Seedbank Management Committee, which takes responsibility for loaning out the seed, tracking farming progress, and collecting loan repayments (in the form of crops harvested). The income generated by sale of the surplus crops then subsidizes the local school.
Seeds for farmers
In rural communities, families supporting street children often opt to receive agricultural support instead of a grant for creating a small business. These families receive bags of seed in the spring - they can choose between groundnut or rice - and harvest in the fall, with a return on investment of up to 400%. With enough harvest to both feed the family and sell the surplus for profit, these families are able to send their children to school with full bellies, and put money aside for their future.
Income generation for rural schools
We ‘lend’ bags of rice or seed to a community, at an interest rate of 33%. The community then farms the crops together, as a collective. On average, for every one bag of seeds sowed, four bags are harvested. Families typically receive a loan of two bags of the crop of their choice.
We use one bag of seed to replace the bag initially lent, to ensure that we can offer the same opportunity to another community. We then sell the remaining half a bag, and give the funds to the community's local school. This highly effective scheme funds school building maintenance and reasonable salaries for teachers, and provides for books and other learning materials - and is a sustainable enterprise for Street Child, meaning that every dollar donated goes further, and makes a bigger difference to more people.
Out of 8 bushels harvested, the women will return between 2-3 bushels to the SMC, keep 2 bushels for the next season, eat 2 bushels, and sell the surplus. They will be assisted through training and mentoring to plant and harvest at optimal times and employ modern farming techniques to maximize yield. Recipients will be encouraged to farm communally, to maximize knowledge and resources such as hiring a vehicle to convey crops to trading villages or towns, where the prices for goods are much higher than in rural villages.
Repayment of the initial loan ensures that the seedbank is stocked to assist further families next season, and the interest is given directly to the local school to pay for teacher training and salaries, and improved learning facilities and materials.