Small loans make big changes

Finance works

iDE commissioned a study in Cambodia with our research partner IDinsight to determine if offering a microfinance loan affected a person’s decision to purchase a latrine. We were surprised to learn that customers were four times more likely to buy a toilet when they were able to spread the purchase over a year with a loan. Based on these results, iDE is expanding access to finance for latrines as an effective way of boosting sales and access to improved sanitation.

Being unable to buy products and services on credit poses a serious obstacle for small farmers. Without upfront capital, they cannot invest in irrigation equipment, seeds, tools, or fertilizers that increase their productivity. As part of our integrated market approach and understanding of the unique characteristics of the places we work, we facilitate small loans for farmers in Honduras through community-based groups called Cajas Rurales, through small “conditional cash transfers” to household farmers in Bangladesh, and through “revolving fund” loans in Mozambique.

Fewer trade offs

Although iDE designs all of its clean water, sanitation, and agricultural technologies with extreme affordability in mind, sometimes a higher quality product is worth the extra cost if a loan is available. When we can partner with the right microfinance providers in the right places, we will be able to significantly multiply the impact of our work.