Promoting Inclusive Markets and Financial Systems
The MasterCard Foundation works with visionary organizations to provide greater access to education, skills training and financial services for people living in poverty, primarily in Africa. As one of the largest private foundations its work is guided by its mission to advance learning and promote financial inclusion to create an inclusive and equitable world. Based in Toronto, Canada, its independence was established by Mastercard when the Foundation was created in 2006. For more information and to sign up for the Foundation’s newsletter, please visit www.mastercardfdn.org. Follow the Foundation at @MastercardFdn on Twitter.
It is estimated that there are 264,000 children orphaned by AIDS living in Rwanda. The 2005 Demographic Health Survey of the Rwandan government found that 29% of children under the age of 18 surveyed were considered to be orphans and vulnerable children.1 The exacerbating effects of genocide and war and the high incidence of HIV and poverty make the Rwandan situation even more complex than that of many other countries in Africa with high numbers of orphans and vulnerable children (OVC).
Households headed by children (defined as those between the ages of 13 and 18) identified in national focus groups cited lack of shelter, food, money, household furnishings, land, farming equipment, firewood, and school materials as the key challenges they face. Completing their education is a significant problem for children heading households, who are frequently forced to leave school to work. Those who are able to attend primary school often do so with a sense of futility, as secondary school fees and other costs make continuing on seem an impossibility. Many also expressed concern over the lack of access to adequate health care for them and their siblings, aware that they are particularly vulnerable to illness and malnutrition. As children adopt increasingly risky coping strategies to survive, the lack of information, life skills, and care significantly increases their vulnerability to HIV infection. Child-headed households (CHH) desperately need skills training and access to financial resources to be able to build sustainable
Since 2005, CRS Rwanda has responded to the needs of orphans and vulnerable children through programming funded by the President’s Emergency Fund for AIDS Relief (PEPFAR) and private donors. The OVC program provides a package of services including school materials, school fees for secondary school and vocational training for CHH, health insurance, nutrition education, and psychosocial support. CRS has carried on its work with OVC through local church partners, primarily diocesan level Caritas groups. Caritas has been able to meet some of the psychological and material requirements of OVC and their households, but a tremendous need remains.
It was into this context that CRS Rwanda introduced the Savings and Internal Lending Communities (SILC) methodology, to help OVC households build financial assets and complement the other services offered through the OVC project. CRS has had extensive experience in implementing SILC activities and has seen tremendous improvements in the economic wellbeing of poor communities. SILC is a proven microfinance tool for reaching very
poor and marginalized communities that are unable to access financial services from formal financial institutions. In linking SILC with OVC programming the intent was to provide OVC households with reliable and safe financial services as well as an avenue for basic financial education.