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Busa Gonofa 
Micro Finance Institution

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(a)   General Information

Year of Establishment

May 1999

Legal Status

Busa Gonofa Micro Finance S.Co. was legally registered by the National Bank of Ethiopia, according to Proclamation No.40/1996.

Current Operational Area (s)

Oromiyaa Regional State

Future Expansion Plan

Busa Gonofa has a plan to operate in more zones in the Oromiyaa Regional State in the next three to five years.

Total Number of Woredas Covered so far

Four Woredas of Oromiyaa

Total Number of Branches Opened so far

Four

Total Number of Clients served so far

6,148 clients out of which 1,967 are urban and 4,181 rural.

Gender Sensitivity

Male clients = 21%, Female Clients = 79%

(b)  Loan Services/Products

• General purpose group loan;

• Employee loan.

Annual Lending Rate

24% with Birr 2 service charge and Birr 3 as other fees.

Loan Size and Loan term Per Loan Cycle and Loan Type

Loan Term

Maximum Loan term = 12 months

Minimum Loan Term = 4 months

Loan Eligibility Criteria

• economically active poor aged between 18-55 years;

• permanent residence in the village or Kebele;

• willingness to join a self-selected group of 15-25 members;

• ability and willingness to repay loans in regular intervals (weekly, bi-weekly or

• monthly);

• ability and willingness to make regular saving deposit (weekly, bi-weekly or

• monthly) or fixed amount that will be determined voluntarily;

• willingness to respect bylaws of the group including meeting attendance, jointly liable for loans of fellow group members and other responsibilities that the group may assigns;

Type of Collateral Needed

Some of the economic activities financed so far

• farm-based activities (fertilizer, seed, land rent, etc.);

• petty trading activities (in cereals, vegetable, etc.);

• food processing and selling;

• service rendering businesses;

• manufacturing (pottery, shoe making, handicraft, etc.);

• acquisition of key productive assets (ox, donkey, tools, equipment);

• durable assets for improving livelihoods (housing improvement, acquisition of

• furniture, radio/television, etc.);

Grace Period

Time needed to process and get loan

Business Plan Presentation

In Busa Micro Finance Institution S.Co. no business plan is required to access the pre-determined loan sizes but the group must unanimously approve the progression of a particular client to the next higher loan size. 

Loan Application Format

Busa Micro Finance Institution S.Co. uses a one page application form per client that provides general information such as:

• personal information such as – name, age, gender, address, etc.;

• asset-base of the household   – household size, education, land and cattle holding,

• available saving;

• economic activities of the household’s major economic earners;

• approval of loans by all group members and undertakings to repay loans incase of default;

Target Clients for Loans

• individual households in rural and urban areas.

Willingness to lend to new business start-ups such as high school drop-outs, college graduates and similar groups

Busa Micro Finance Institution S.Co. does not finance new business start-ups.

Frequency of Revising Institutional Policies

The loan policies are revised as frequently as the need arises.

(c) Savings Products

(d) Other Services

Orientation is given to clients, but not frequently.

Service Out-let

Service is provided at the doorsteps of the client and branch/sub-branch office of the Institution.

New products to be introduced during the coming 3-5 years

Address

P.O.Box:  24850 code 1000, Addis Ababa, Ethiopia

Telephone:  +251-1-653283 or +251-1-654155 or Mobile: +251-09-223679

Fax:  +251-1-654045

E-mail:  bgmfi@telecom.net.et     bgmfi@telecom.net.et

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