Solomon: Credit Guarantee Success (Ethiopia)
He has been in business, collecting grains and selling to processors, for 15 years. Since 2007, he established his own processing business and engaged in grain processing—focusing on rice. In addition to rice, he processes and wholesales oats and rough peas. He has two rice de-hauling/polishing machines and four employees.
Solomon is married and he has two daughters. His sister and a housekeeper are other members of the family that he supports financially. His wife helps him with the business activities.
He has received working capital loan from Bunna International Bank, a private bank in Ethiopia, of 180, 000 birr (about $10, 000). His previous loan history is from a local microfinance institution called Amhara Credit and Saving S.C, with a maximum amount of 5,000 birr.
The loan from Bunna Bank is the first of its type and amount in his life. This loan enables him to buy and process in bulk, which has increased his revenue to a large extent. He is able to collect more paddy rice by giving cash advances to 15 farmer-traders for 5,000 birr each. Furthermore, he is engaged in buying processed rice and wholesaling to retailers in Addis.
Now he is able to compete with other big processors in town. This is a result of his added financial capacity to attract more customers with the immediate cash payments he can make. Even though he has accessed the loan recently, already he is able to see the difference in terms of increased numbers of customers and the higher revenue generated. He believes that he will make his monthly loan repayments without any delay. Solomon anticipates more benefit from the additional working capital and realizing the impact of the loan in his life in the near future.