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Shasheme Iddirs 
Yelimat Agar Micro Finance

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( a )  General Information

Year of Establishment

February 2001

Legal Status

Shashemene Iddirs Yelimat Agar Micro Finance Institution S. C. was legally registered by the National Bank of Ethiopia, according to Proclamation No.40/1996.

Current Operational Area (s)

Oromiyaa Regional State – Shashemene town

Future Expansion Plan

The Institution has a plan to continue operating in the Oromiyaa Region and also start working in Southern Nations and Nationalities Peoples Regional Sate (SNNPRS) in the coming three to five years. 

Total Number of Woredas Covered so far

One Woreda (10 Kebeles in the town of Shashemene).

Total Number of Branches Opened so far

One Branch

Total Number of Clients Served so far

1,864 out of which 1,504 are urban and 360 rural clients

Gender Sensitivity

Male clients = 53%, Female Clients = 47%

(b)  Loan Services/Products

• Micro and Small business loan (loans to petty traders, local food and drinks   processors, cart transport, small hotels and tearooms and similar retail activities);

• Oxen loan (loan to purchase oxen);

• Agricultural loan (loans to off-farm activities such as handicraft, cattle fattening, cereal vending, etc).

Note: Loan is provided only to ‘Iddir’ members.

Annual Lending Rate

13% (flat) for all loan types and no other additional charges.

Loan Size

The amount of first loan to any one client and activity shall not be more than Birr 2,000.

The loan size depends on the type of activity that the client is engaged in. The loan size increases by 50% as the client progresses from one loan cycle to the next.   

The maximum loan size that can be secured from the Institution at the moment is Birr 5,000.

Loan Term

Maximum Loan term   = 12 months

Minimum Loan term   = It depends on the nature of the business of the client.   Interest on loans is calculated on a yearly basis and the client is charged with full amount of the yearly interest amount even if he/she repays the loan before the maturity rate.

Loan Eligibility Criteria

Potential clients are expected to meet the following criteria:

• Clients should be members of the Iddir’s shareholders or supported by NGO projects. An NGO known as ACCORD has various development projects with members of the Iddir;

• The client must be physically apt;

• Should reside in the town;

• The client should agree with the rules and regulations of the Institution;

• For subsequent loans, a client should prove that he/she has good credit history;

Type of Collateral Needed

Group guarantee is the only collateral needed for all types of loans.

Some of the economic activities financed so far

• Petty trade;

• Fattening;

• Handicraft;

• Selling of agricultural products such as cereals.

Grace Period

• No grace period for micro business loans;

• Three months grace period for cattle fattening.

Time needed to process and get loan

Five days, excluding the time required to form a group with in the Iddir.

Business Plan Presentation

Clients should present a business plan with the following contents:

• Purpose of loan  (specific business activity that the borrower is requesting loan for);

• Required inputs to run the business and their costs;

• Expected income from the business;

• Amount of loan requested;

• Evaluator’s comment.

Loan Application Format

The major contents of the application format are full name and address of the client and his/her commitment to obey the rules and regulations of the Institution.

Target Clients for Loans

Individuals (Iddir members who are organized into sub-groups).

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

New business start-ups within the Iddir can be financed provided that they presented feasible and viable business ideas. The Institution can assist such clients in business plan preparation and evaluation.

Frequency of Revising Institutional Financial Policies

The Institution revises its financial and loan policies every year.

( c )  Savings Products

( d )  Other Services

No other interventions were reported apart from financial services.

Service Out-let

Services of the Institution can be accessed through its branch office in Shashemene.

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

Loan:

• Individual loan with third party collateral (with personal guarantee, institutional guarantee, etc).

Savings:

• Institutional saving

 Other services:

• Health insurance for borrowers;

• Any other allied activity mandated by the National Bank of Ethiopia.

Address

P.O.Box:  451, Shashemene

Telephone:  +251-6-103881/105952/105263

Fax:  +251-6-102051

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

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