Women’s Enterprise: Providing Business Training and Access to Micro-credit
A Case from the North: Norwich, remedy England
Norwich, check a city of 170,000 inhabitants, is a member of the World Alliance of Cities Against Poverty. Although it is apparently a prosperous city, one third of its citizens live below acceptable levels of income. In 1995, the Norwich City Council elaborated a new anti-poverty strategy. One of the actions that was initiated as part of this strategy is a micro-credit programme for women, “The Full Circle,” which began in March 1998.
Women’s Full Circle
Full Circle is a micro-credit for enterprise programme based on the idea that micro-enterprise can be a route to self-employment, but that one must remove the hurdles normally faced by low-income women who want to start their own business: problems in access to credit and lack of ongoing support.
It is designed to be a lender of last resort for women who do not have access to commercial credit. The Programme not only provides them with access to loans, but also with training in business skills, peer group support, and additional help in starting a business and making the transition to self-employment.
Full Circle was conceived by an independent voluntary organisation called “Women’s Employment Enterprise and Training Unit (WEETU)”.
WEETU was founded in 1987, with the support of the City Council, by a group of women concerned about the lack of guidance available for women returning to the labour market. From 1987 to 1997, the City Council was the main core funder of WEETU.
Since 1997, the City Council supports WEETU’s activities on a project funding basis only, and WEETU’s core budget is now composed of donations by private and public organisations.
The City Council is funding the “Full Circle” along with other community organisations.
This new project has been publicised through community groups and by the City’s anti-poverty advisors in order to reach the beneficiaries.
“Full Circle” was established to support women with low individual incomes. Participants may be unemployed or unwaged, beneficiaries of state welfare, or working part-time or in a low-paid job.
Initially, WEETU did not want to screen participants and preferred to rely on mutual trust. However, the number of applicants for loans and training in 1998 far exceeded the estimates: it was expected that 45 women would be trained during the first year, but WEETU received almost 6 referrals per week in the second half of 1997. Because of this problem, a screening policy has been formulated. Applicants will therefore be assessed on individual income (i.e. regardless of a woman’s partner’s or families’ income, because it cannot be assumed that they have access to it), financial exclusion (i.e. providing proof that they are unable to raise a commercial loan), commitment and preparedness.
The training phase of the programme consists of four stages:
- The length of this initial training phase is 15-16 weeks. Participants can join at any stage. Those who feel that their business plan is well-defined may join at the fourth stage only, as long as they are accepted by a borrowing circle.
- Two field workers, called “enterprise development officers”, will train and support the participants throughout the programme.
- Pre-training. Information sessions are given about “Full Circle” to potential participants, who have a chance to discuss their business ideas.
- Is Enterprise for Me? Consists of confidence building and training on how to evaluate business ideas, conduct a feasibility study, a market research, etc.
- Skills for Business. Participants are assisted in preparing their business plan
- Group Formation. Women form “borrowing circles” (also called peer groups) of 3-5 participants.
- Each circle imagines worst-case scenarios in order to establish rules to deal with all possibilities. They then apply for loans as a group and continue their training together.
Additional support is given to women in making the transition to enterprise. Financing for partial childcare or dependent care (up to 15 hours per week) and transport is provided by WEETU during the training and the first year in business. WEETU also is trying to negotiate a welfare benefits waiver so that participants can claim benefits during their first year in business.
Each borrowing circle decides, as a group, which member is ready to apply for a loan first. That member must have made several repayments before the next one can have her loan. Moreover, the group is liable for any individual member’s inability to repay the loan, and access to new loans for members of the group will be frozen until defaults are cleared. Each member pays 5% of her loan into an emergency fund to be used if the group requires it. This will establish a solid basis for mutual support and trust.
Funding and Resources
The loans are not taken from WEETU’s budget, but from a Loan Fund established as a separate entity, with its own board of trustees which gives the final approval for loans. In general, however, it will accept the recommendations of the borrowing circles. The Loan Fund consists of donations by private foundations as well as the City Council.
Office and training space, as well as access to computers for participants are provided by WEETU. WEETU also pays the wages of the two “Enterprise development officers”. Eventually, specialists from the business sector could be brought in on a voluntary basis for specific training modules.
WEETU plans to train 45 women during the first year and expects that 30 of them will go on to start businesses.
Participants who become eligible for commercial loans will be encouraged to continue meeting with their peer group and be an inspiration for others.
WEETU plans to gradually withdraw from the peer groups when they are strong enough to continue meeting on their own. The groups will be encouraged to continue meeting even when they stop borrowing from Full Circle.
Certificates will be given to all participants so that their additional qualifications can be recognised, and women who choose to leave the programme for any reason will receive support in identifying alternative routes to economic independence for themselves. This is called the “no failures rule” of Full Circle.
Women who start businesses will become independent and self-employed, and this project will contribute to overall community development through the introduction of capital to low-income areas, the development of community based trading links, and the establishment of local business networks.
We thank the Norwich City Council and WEETU for providing us with the information about this initiative.
For more information, please contact:
Mrs. Chris Polpewlmell
Norwich City Council, Advice Arcade
4 Guildhall Hill, Norwich, NR2 1JH,
phone: (01603) 212 .457
Mrs. Erika Watson
Women’s Employment, Enterprise and Training Unit, WEETU
The Music House, Wensum Lodge
King Street, Norwich, NR1 1QW
phone: (01603) 767.367, fax: (01603) 666.693,