This proposal is to partner with Development Alert to deploy $3,000, which will be broken down into 0% interest revolving microloans for small business owners in Tororo, Uganda. An additional $1,000 will cover loan administration and provide recipients with financial literacy and business management training. The revolving model ensures that repaid funds can be reissued to support more entrepreneurs.

One-year cost breakdown

If our members are satisfied with the outcomes of the initial injection over the year, we may vote to increase the amount of capital in the revolving loan pool.

Why is this work necessary?

Small businesses are vital economic engines in local communities, but many struggle to access traditional financing. High interest rates, complex application processes, and collateral requirements create barriers for entrepreneurs who need modest capital to start or grow their businesses.

By providing no-interest microloans through trusted community partners, we can help bridge this financing gap. The revolving structure means that as loans are repaid, those funds become available to support other entrepreneurs - creating a sustainable cycle of local economic empowerment.

When combined with financial literacy and business training, these microloans give entrepreneurs the resources and knowledge they need to build sustainable enterprises that create jobs and strengthen their communities.

Who is Development Alert?

Development Alert, founded in 2020, is a Ugandan nonprofit community organisation that focuses on tackling poverty, addressing water shortages, reducing inequality, and combating environmental degradation in Uganda.

The organisation is officially registered as a community-based organisation under registration number CR127/2020, renewed as CR/11/2022. In 2024, it was named the "Most Dedicated Local Community-Based Support Organization Uganda."

How this will work

The loans will have flexible and accessible terms designed to meet recipients' needs. Development Alert: The lending partner will determine loan sizes (between $100 and $500) and repayment periods (between 3 and 12 months) based on the local context and the type of business being supported. The loans will be interest-free, and repayment schedules will follow the structure set by the lending partner.

Recipients will be small business owners or entrepreneurs with either a viable business idea or an existing business. They will need to demonstrate a commitment to attending training programs and be in good standing within their community. These requirements will ensure that loans are given to individuals prepared to use the support effectively and contribute to their personal and community development.

The program's success will be measured using both quantitative and qualitative methods. At a group level, key indicators will include the number and value of active loans, repayment rates, average loan sizes, and the introduction of new products or services. On an individual level, metrics such as loan status and business growth will be tracked.

This initiative will be a joint effort between Kwanda and partner organisations. Kwanda will supply the loan capital, operational funding, program framework, technical support, and ongoing monitoring while also facilitating knowledge sharing. Partner organisations will handle the selection of loan recipients, loan distribution, repayment management, recycling of repaid funds, and business support. Administrative responsibilities will include maintaining records, ensuring compliance with local regulations, reporting metrics, and managing client relationships, including addressing disputes when needed.

Impact and outcomes

This partnership will:

• Offer accessible loans to underserved entrepreneurs in Tororo, Uganda

• Support financial literacy and business management capabilities

• Create a sustainable loan fund that revolves within Tororo, Uganda and surrounding districts.

• Promote local economic development in Tororo, Uganda.

A successful pilot of this revolving loan fund will illuminate a path towards larger capital injections in Uganda.