Sawsan Gaddo from Komombo- Aswan, a microfinance client who has obtained her first loan of 15.000 EGP to …

AKDN / Gary Otte

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The Shegnan bazaar in Badakhshan, Afghanistan. Several shopkeepers have benefited from loans from AKF to stimulate enterprise. 

AKDN / Sandra Calligaro

The Loans in Practice

In Afghanistan, the First Microfinance Bank (FMFB) has designed its products with the aim to help improve life, learning, social conditions, career progression and physical/mental health. Thus, quality of life loans have been developed in the form of vehicle, marriage, home appliance, healthcare and student loans. The loan size ranges from US$ 200 to US$ 6,000 equivalent in local currency. Loans are not directly linked to income generation but supplement the income of the borrowers and are meant to contribute towards the enhancement of their income over a period of time. The bank undertakes a vigorous need assessment of the borrower by investigating their requirements and makes sure that repayments are affordable and sustainable.

FMFB Afghanistan has used its programmes for quality of life improvement loans to help reduce discrimination and poverty among marginalised groups. It offers them financial assistance for skills training, capacity building for income generation and functional literacy that will increase their employability and empower them in the long term. By encouraging the social integration of marginalised and disadvantaged individuals and by improving different aspects of life, the loan programmes can help reduce public expenditure for social services. Thus, quality of life loans can generate social impact and stimulate social inclusion and cohesion.