New loan product developed for women farmers in Papua New Guinea: EMTV news
EMTV covers the signing of a Memorandum of Agreement between Women's Micro Bank and NKW Fresh Produce to launched an innovative new loan product developed with support from PSDI.
These loans are among the first of their type to be offered in PNG, and allow WMB to offer finance to women who are unable to provide the kind of security that commercial banks normally insist on – such as land, buildings, or payroll deductions. The new product instead uses the women’s supply contracts with NKW Fresh as collateral, and will allow them to access up to K20,000 for income-generating purposes.
A Memorandum of Agreement to begin a trial phase of the new product was signed in Lae on March 2 2020. During this phase, a group of around 15 eligible borrowers – who have an existing supply contract with NKW Fresh – will be able to borrow up to 90% of the purchase price of a small, walk-behind tractor. With these tractors, the growers will be able to cultivate larger plots of land, helping to increase their output and improve their incomes. Training and support for the use and maintenance of the tractors will also be provided.
The potential benefit of this financing was identified by the Pacific Private Sector Development Initiative (PSDI), who worked to develop the partnership between WMB and NKW Fresh, and to provide expert technical assistance to support WMB to develop the loan product.