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Life cycle of a loan project
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Key considerations
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Consultation
1. Loan agent meets with cooperative to outline a project
2. Project is discussed with entire cooperative assembly for approval
3. Plan is passed to La Base loan commission for analysis and approval
4. Project then retuns to Step One until the best possible plan is in place
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- Cautious, complete analysis of the plan is key to the whole project
- Initial ideas are typically too grand and optimistic; consultation should try
to promote achievable goals and leave the incentive of follow-up for further goals upon completion
- Officers are trained to strip down all business ideas to their core concepts, ensuring effective consultation even with first-time entrepreneurs
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Creation
5. An analysis of the economic and social projections of the project
6. A detailed business plan for the loan is created out of consultation meetings
7. A calendar is created, indicating steps for the project and which the loan officer will use to track progress
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- Initial projects are broken into as many small, precise plans as possible -- shorter projects
are easier to plan correctly, and next steps are best left for follow-up loan projects
- Within a project, the plan is broken into as many measurable steps as possible and put on a calendar;
this allows the loan officer to detect any deviation from the plan early on, allowing for the best chance
to work proactively to fix problems as soon as they appear
- Repayment schedule should carefully match the maturation logic of the loan
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Follow-through and monitoring
8. Loan officer accompanies the cooperative for the major spending in the project's investment phase
9. Loan officer makes weekly visits to the cooperative and assesses how the project's progress compares to the plan
10. If progress strays from the plan, immediate reevaluation of the calendar of events is undertaken
11. Problems that cannot be solved are discussed among La Base's loan commission and an intensive consultation is performed
to look for solutions
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- In a new business in the developing world, life is often unstable: the
loan officers job at this stage is to be the advocate of the project keeping
attention from straying and ensuring plan goal's are met
- The initial calendar is the key to this stage; any deviation
should cause assessment of the whole plan to decide if the final target will be met
- The loan commission is the lifeline; when business problems occur, the focused
attention of this group of experienced consultants can help push a project to success
- The experience of the constant monitoring and consultation is also a great
ways for the new business owners to learn
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The Next Evolution in Microcredit