Mary is requesting a loan $US275 to buy additional supplies such as hair dryers and other hair products for her store, which will allow her to serve more customers and generate additional income.
SELFINA has taken a lead role as a pioneer of micro-credit in Tanzania through Micro-Leasing. The organization is engaged in the economic empowerment of women in Tanzania through the provision of a leasing and leaseback microfinance facility as a practical way to achieve the economic and social emancipation of women. Customs and traditions in Tanzania normally make it difficult for women to own land and assets, thus they are termed non-creditworthy by financial institutions as they lack tangible collateral assets. This leads to poor financial support hence the poor access to basic needs and services for women with low incomes. When a client needs working capital to buy a specific item, SELFINA buys the equipment for said client and extends a loan to her. The same equipment is then leased back to the client so they can use it while in process of paying back their loan – a process called a sale and leaseback arrangement. Once the loan has been repaid, SELFINA transfers the ownership of the equipment to the client. The advantage of microleasing over traditional microfinance loans is that is allows clients to use the equipment as collateral for future loans with SELFINA, thus enabling them to borrow larger sums in the future.
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