The methodology developed by Hand in Hand, a non governmental organization based in the Indian state of Tamil Nadu, will be used in a project backed by the Inter-American Development Bank’s Multilateral Investment Fund (MIF) and World Vision Brazil (Visão Mundial).
Hand in Hand (HiH) helps rural women establish self-help groups, providing them access to skills training, literacy programs, microcredit and business links. In three years it has assisted more than 310,000 clients, focusing on members of historically disadvantaged castes (dalits).
HiH self-help groups usually involve between 12 and 20 women who receive counseling on pooling savings, the first step towards gaining access to credit. The NGO also offers crash courses in reading, writing and arithmetic, basic business management and book keeping skills, and vocational and entrepreneurship training.
To date, women in HiH self-help groups have started 168,000 microenterprises. The NGO works closely with businesses and governments, which employ people trained by HiH or contract their microenterprises as suppliers of goods or services.
“Hand in Hand’s model offers many valuable lessons for Latin America,” said MIF project team leader Svante Persson. “One of its major strengths is that it effectively combines technical assistance, access to finance and business linkages. It has also achieved massive scale in a strikingly short time, a crucial factor for a country of continental proportions like Brazil.”
The project backed by MIF and Visão Mundial will involve a network of at least 50 local NGOs, cooperatives, small business associations and microcredit institutions in 10 states in northeastern Brazil, which will use the HiH model to assist some 50,000 people in establishing small groups to work on income-generating opportunities.
The MIF, an autonomous fund administered by the IDB, will contribute US$2.5 million to the project. Visão Mundial, which is affiliated with the Christian humanitarian organization World Vision International, will contribute the equivalent of US$3 million, with support from the Brazilian small business development agency SEBRAE.
Visão Mundial has been working in northeastern Brazil since 1975, helping poor communities undertake local development programs and address critical needs such as clean water, food supplies, basic healthcare, education and income generation.
The MIF supports private sector development in Latin America and the Caribbean, with an emphasis on microenterprise. Based on the outcome of the project in Brazil, the MIF could take the HiH model to other countries in this region.