IFRC


Red Cross loan saves a family from ruin

Published: 14 January 2015 8:41 CET

By Liu Shu, IFRC

When Wei Hanbi received a call from the hospital a few years ago, she was devastated to find out that her husband had been brought to the emergency room after a road accident. Like most women of her generation, Wei, who is now 42, had always depended on her husband as the breadwinner of the family. After the fateful accident, he was bedridden, and Wei found herself under a mountain of debt from unpaid medical bills.

In the weeks following the accident, worries about the future kept Wei awake at night. “Without skills or education, I did not earn enough salary to support my whole family,” Wei explains when she was interviewed at her home. “The only solution I could think of was to start a business, and I was interested in breeding pigs. But purchasing livestock and feed requires a big investment and I couldn’t get a bank loan because of my low income and because I had no more savings.”

It was then that Wei heard about a small loan project managed by the Red Cross Society of China branch in Mianzhu, Sichuan. She found out that the Red Cross was granting loans with subsidized interests to low-income families, and decided to submit her application.

“I went to the Red Cross branch to see if I qualified, and I could hardly believe how quickly they approved my application,” Wei says. The bank staff explained to her that the loan interests were subsidized by the International Federation of Red Cross and Red Crescent Societies (IFRC) so low-income families could start businesses and get out of poverty.

The Livelihoods Support Project is part of the IFRC Sichuan earthquake recovery programme, providing vocational and business training as well as access to financial resources through microcredit loans. The goal is to help earthquake survivors who have been relocated find new ways to earn an income. The small loan programme targeted nearly 6,000 relocated farmers and people with disabilities. By the end of December 2014, 797 households (approximately 3,081 people) have received small loans, with 645 of these loans already re-paid by the borrowers.

“The Red Cross was there to help us when we had no way out,” says Wei. “I was almost hopeless after the accident, but now, thanks to the small loan, I am able to breed and sell pigs. My husband is slowly recovering and starting to walk around a little. We plan to use the profits from this livestock business to pay for his next surgery.”

 




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