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| The Shurush Initiative's inaugural microloan program with the East Jerusalem YMCA
In August 2004, The Shurush Initiative partnered with the East Jerusalem YMCA to initiate an innovative pilot Rural Entrepreneurship Loan Program. The program supports small, rural enterprise development and creates job opportunities in the Palestinian small business sector through a commercial loan program for entrepreneurs under the age of 35 in rural areas surrounding Bethlehem and Ramallah.
The goal of Shurush's inaugural microloan program is to stimulate long-term, self-sustaining jobs and micro/small enterprise development among vocational graduates/workers in the vocational industrial sector of the West Bank and Gaza. The program’s primary goals are to provide more accessible opportunities to: (1) start-up microenterprises; and (2) develop small businesses in targeted vocational fields in order to achieve self-sustaining income generation.
Shurush's program with the EJYMCA represents a creative joint partnership and an expansion of the YMCA Small Enterprise Development and Job Opportunities Program (SEDJO).
Visit the East Jerusalem YMCA’s website:
http://www.ej-ymca.org
Program details
Loans are repaid between six months and two years; loans may not exceed three years. The East Jerusalem YMCA reports to The Shurush Initiative quarterly with complete financial information as well relevant case studies. This information will subsequently be available for public viewing on the Shurush website.
This program is also functions as a new addition to the YMCA’s Small Enterprise Development Program and focuses on low-capital microloans.
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Involved targeted groups covered by the SED include male and female that either graduated or are working in the following vocational professions: |
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Carpentry, upholstery, handmade woodwork |
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Auto, electronic, and auto body repair |
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Aluminum/metalwork and blacksmithing |
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Sewing, tailoring, and clothing design |
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Laboratory, dental, and medical fields |
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Plastic works and small production factories |
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Construction activities |
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Electrical machine maintenance |
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Stone works |
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Loan procedures |
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1) |
Submission of Loan Application Form |
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Briefing by a YMCA field worker on business description and expected outputs |
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Application fee (currently U.S. $15) |
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Field Staff visits the site and provides the necessary information |
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Loans Approval Committee meets and discusses the application |
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Committee decides and informs the loan applicant with its approval |
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Consultancy is provided at the borrower’s discretion |
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The borrower decides on the supplier, based on the principle of the best price for the best quality. |
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The loan amount is decided by both parties, the concerned filed worker and the borrower, an agreement on repayment period is made |
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Legal contract is signed between the two parties, in addition to the signatures of two guarantors. Main points: |
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a.
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Checks and/or payable notes are taken in advance distributing the loan amount and interest on a monthly basis over the loan period.
Loan Annual Interest Rate = 7 percent |
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Each guarantor signs checks and/or payable notes distributing the loan amount and interest on a monthly basis over the loan period. |
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Follow-up Measures Taken: |
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Follow-up visits are made on a monthly basis at the business place in order to track and monitor the project’s progress |
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Delays on payments will be charged with a delay fee, any returned check will be charged with returned back fee. |
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In cases of non compliance to the terms of contract, borrower and guarantors will be legally liable, and the matter would be followed up through established legal procedures. |
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