1. Hendricks & Associates Tianjin Women Self-Employment & Job Creation Workshop Microfinance

2. Hendricks & Associates Tianjin Microfinance The Clients The Model Management

3. Hendricks & Associates Tianjin Microfinance Clients Social Criteria – LOWW with temporary work (80% Minimum) – Single parents – Unemployed for social reasons or never employed – Large families but only one can work – Those holding temporary low paying jobs in informal sector

4. Hendricks & Associates Tianjin Microfinance Clients Economic Criteria – Earn below ½ the average monthly disposable income (385Y per month) – Less than 30,000Y (present market value) in moveable assets – Less than 10,000 in fixed assets

5. Hendricks & Associates Tianjin Microfinance Clients Marketing and Promotion – District Women’s Federation – Word of mouth in the markets Support provided by the group Training at the Center Meetings Product groups working together for group purchases

6. Hendricks & Associates Tianjin Microfinance Clients Most former employees want to remain employees Not everyone can be an entrepreneur

7. Hendricks & Associates Tianjin Microfinance Clients Two Types of Clients – Women who were labourers tend to become vendors, generally as a last resort because there is no temporary work available. – Women who were former managers tend to set up small to medium enterprises and appear to have more self confidence and knowledge about how to manage the risk of self employment

8. Hendricks & Associates Tianjin Microfinance Clients

9. Hendricks & Associates Tianjin Microfinance Model Rural models do not work in cities – Nature of community is different – People you know do not always live nearby – Location based solidarity groups need to be based on business location not residence Greater opportunities for efficiency in urban environments

10. Hendricks & Associates Tianjin Microfinance Model Pre-loan training of 3 days Solidarity Groups of 4-7 women Centers of 5 groups – Meet bi-weekly for ongoing training – Maintenance of Loan Officer/Client relationship

11. Hendricks & Associates Tianjin Microfinance Model Solid business growth requires good financial management Providing only 50% of start-up costs as a loan contributes to good financial management

12. Hendricks & Associates Tianjin Microfinance Model Loan Products – Basic Loan - 4000Y 1 st Year, increase by 2000Y per year, administration fee of 30Y on first loan, 5% guarantee deposit, 7.605% interest on declining balance, 25 payments over 12 months. 10Y savings per payment. – Festival Loan - 4000Y, 1 month term, repaid before festival date, all other terms same as basic loan, not applicable to Chinese New Years. – 3 New Loan Products under development

13. Hendricks & Associates Tianjin Microfinance Model Bank Attitude is Critical Involvement for Charity focuses on cost of contribution – Involvement for Marketing purposes focuses on benefits of increased business (Tianjin City Commercial Bank) and commitment to the community

14. Hendricks & Associates Tianjin Microfinance Model Indicator 200011 Mo.s 2001 Active Clients3091107 Loans Outstanding 639,3202,943,720 Current Value922,0004,676,000 Average Loan Size 37604095 Client/L. O. Ratio77.25217.6 Operating Self Sufficiency 20%92% 47.22% Without training

15. Hendricks & Associates Tianjin Microfinance Management Separate the political arm from lending decisions Manage the program conservatively

16. Hendricks & Associates Tianjin Microfinance Management Use of Bank and other technology keeps costs down Strong financial management leads to financial stability Dedicated and committed staff market the program and contribute to sustainability