Introduction of Microcredit
In May, 1997, a microcredit working station was established in Shilicun, with Zhou Zhengxi as director, Deng Yingli as the specialized creditor and cashier, and Gao Chengxiang as an accountant. In July, 1997, an amount of USD 21,772 (about RMB180,000) was received as first tranche and in January, 2000, as the second tranche amounting of USD 16,228 (about RMB 130,000) were received from GT. The total capital reached up to RMB 310,000.

On September 2, 1997, the first disbursement was made in Heping village. Currently, the accumulated loans allocated to the farmers amount to RMB 960,000. RMB 250,000 have been used in plantation, RMB 400,000 in livestock raising, RMB 150,000 in manufacturing and RMB 160,000 in business. The loans have covered 8 villages, 8 centres and 48 groups. 240 households have received their loans. While 125 households have received loans for the third time, 25 households have completed the fifth cycle.

Impact of GB Microcredit

a. The living conditions have improved
Out of 240 participating households, 192 have used the loans to purchase cement, bricks, and tiles to build new houses and bid farewell to traditional houses built with earthen walls and grass roof. The new houses have improved their living conditions. They account for 80% of the villagers who have received microcredit.

b. Use of electricity in rural areas has increased
Each participating household has contributed RMB 200 to the improvement of rural power grid. By the end of 2002, 240 households not only have paid off the debts, but also improved the living conditions by using electricity.

c. Awareness of ecofriendly agriculture
6 years’ after using microcredit loans in Shilicun township, the household awareness of increasing the income is strengthened, the approaches are diversified, and the demand for better living standard has grown. In the meantime, with rising income, ecological awareness has been strengthened. One good example is that the households using loans to renovate pigpens, have also used the loans to set up natural ponds. Seventy households have received RMB 140,000 for establishment of natural ponds. Natural ponds had several advantages: firstly, it could make full use of pig waste, ox and horse waste so as to improve the environment; secondly, the residue and liquid from the natural pond could be used as the most effective organic fertilizers and the cost of chemical fertilizers could be reduced; thirdly, it could save labor cost and stop deforestation.

The implementation of Grameen credit for poverty alleviation in China, not only has solved the problems of food, clothing, and income for farmers in Shilicun, but also strengthened their confidence to get rid of poverty. It has played a positive role in developing the rural economy.

Source: Jin Ping Foreign Aided Project Report