Family farms are the basis of the rural ecosystem
Agriculture is a fundamental resource for farmers in Southern countries. It provides their food and, if the production is good, some cash for schooling and medical expenses.
Combining it with livestock allows farmers to diversify their income and to reach food security with a limited impact on their environment. Agriculture and livestock are complementary: harvest residues feed the animals and excrements provide manure ; some animals can help on the fields and breeding them over the year guarantees a stable activity and income even during lean season. Family farming is therefore key to economic and social development in rural areas.
Farmers take advantage of everything they can from their livestock: meat, milk, leather or manure -natural fertilizer produced by the animals. The animal is therefore literally a walking savings account, which allows the family to fulfill its needs at times of food insecurity.
But owning a first animal remains a cost that is difficult to overcome for rural populations…
Rural credit as a means of local development
The rural and agricultural world is still excluded from traditional banking systems. For many reasons, micro-funding institutions will typically not take the risk to lend to farmers, due to the geographical isolation, lack of monitoring infrastructure, seasonality of the income linked to the production cycle, lack of reliable warranties, etc.
Luckily, some rural micro-credit organizations are offering services appropriate to their activity. But the rates and required warrantees usually prevent access to the poorest part of the population, maintaining the vicious circle of poverty.
Zebunet is addressing this problem by creating a rural community lending system that enables poor families to proudly develop their activity : an individual or a company from the North can subscribe to a PEA (Plan Epargne Animal, or Animal Savings Account) on Zebunet’s website and give a specific amount of money to a farmer from the South to buy a first animal. The PEA let Zebunet grant a community loan, allowing the farmer to start a new livestock activity. Within 12 to 36 months, depending on the project, the farmer is refunding the loan and developing the livestock. At the end, they will own the animals and thus benefit from a diversity of activities and income. Thanks to the refunded community loans, Zebunet can pre-finance new projects of community lending, whether it is livestock, reforestation, biogaz, equipment, etc.
In any case, PEA funds sent in a country will necessarily stay in the country of the project. Zebunet is not after profit, and if there are some interests, they would only be used to cover some of our local partners’ management costs. Therefore, the rural credit really works towards a virtuous cycle of development: an individual can support a farmer from the South and these funds, once recovered, are used to pre-fund other activities.