They are considered micro-entrepreneurs, women who are helping their families out of the cycle of poverty by starting small businesses to supplement their husbands’ income. But where do they get the money to start when they don’t even have enough to put food on the table? In the past, the only alternative was turn to loan sharks if family could not help. More often than not though, the women found themselves in a worst financial situation when things didn’t work out as they cannot pay the exorbitant interest fees.

Banks certainly were out of the question as not only could they not even figure out how to fill out the many application forms, the fees alone to process the loan would be more than the loan itself. After all, which bank would be interested in giving out US$50 loans for a business? This is where the microfinancing companies such as CCT (Center for Community Transformation) come in.

Conceptualized and proven by Muhammad Yunus in Bangladesh, microfinancing works by furnishing microloans coupled with social support to women for their enterprise. In the Philippines, these are often sari-sari stores (mom and pop shops) or simple handicraft items made from scraps or recycled materials.

The micro financing company also often (not always) helps source for products and buy them at wholesale prices to resell to their clients. It is a source of income for the company while at the same time allows the microentrepreneurs to buy at lower than retail prices, giving them better profit margins.

Much more important than the loan however is the social support and structure given by the microfinancing company. This is done by visiting the women where they live, organizing support groups where women of similar businesses can discuss their problems as well as future plans, and running short business courses teaching simple bookkeeping and marketing to make sure they are running a viable business.