(ERGO) – Katibo Abdikadir Sheik Ali runs a thriving business transporting mangoes, pawpaw, and watermelons from southern Somalia’s Lower Shabelle region to sell in the capital Mogadishu.
Just four years ago, she was struggling to make ends meet as a fruit and vegetable hawker in the city. But now, her business is growing and her family is living comfortably, thanks to credit made available by a local bank.
Katibo is among 5,000 small scale traders who have taken microfinance loans from the International Bank of Somalia (IBS) in the four years since it began targeting women like her.
She took a $500 no-interest loan from IBS and changed her life.
“I borrowed $500 from the bank and I invested the money in fruit and vegetables. I set up my own shop in Hamarweyne market,” said Katibo. “I supply two truckloads of fresh fruit to Mogadishu each week, distributed to three or four fruit retailers. It is hard to sell a whole truckload of fruit, so I decided to give opportunities to other people to make a living out of selling the fruit. This has been a win-win situation for all of us and improved our standard of living.”
Two years after her first loan, Katibo led a group of 10 women in applying for another loan. Katibo strengthened her business and employed two of her sons.
“Our group got a loan of $500 the first time, and $1,000 the second time. This money helped us very much because it backed our businesses. Thankfully, we settled the loans within 10 months paying $60 per month,” she said.
“Life is much more comfortable than before. When I was a hawker, profits were not enough to support the family needs. I used to get no more than 80,000 shillings ($3) – but today I get $8 to $10 per day, which is enough to support the family,” she noted.
Katibo has invested in land in Kawa-godayn neighbourhood.
“Despite the ups and downs I went through, I am now settled and stable. I don’t pay any rent as I built a brickhouse on my plot in Bondhere district,” said Karibo. “I also bought two other plots worth $8,000 and $7,500.”
She bought a rickshaw to set up her first born son in his own business. She pays the school fees of $8 each for her four other children.
Other beneficiaries of the credit scheme are Kafiya Ahmed Mohamed and four colleagues, who are now running a shop selling Somali handcrafts, cultural items and clothes in Hamar-weyne.
“I was a hawker initially but we have got a loan of $500 eight different times (from IBS), so we expanded our business and set up a shop,” said Kafiya.
“Now we are able to support our families, and I also pay $32 in school fees for my children.”
The head of IBS investment department, Abdiweli Mohamed Elmi, said the microfinance scheme targets small scale traders from poor families in Bakaro, Hamar-weyne, Suq-ba’ad and Madina markets.
IBS offers small micro-credit cash loans of up to $1,000 to traders to start a business, and for larger micro-investment it offers loans of $1,000 upwards.