Under the leadership of Past International President, Lion Mahendra Amarasuriya, the Lanka Lions Foundation initiated a Micro Loan scheme in December 2012 to assist ‘the Economically active poor’ including micro entrepreneurs who are unable to avail themselves of credit facilities from other formal sources, to obtain micro loans through the Lions Clubs in the Multiple District 306.
The funds in the Lanka Lions Foundation comprises of donations made by over One thousand two hundred & fifty Lions, which has been matched Rupee for Rupee, up to Five million rupees by the Settlor of the Foundation, Past International President Lion Mahendra Amarasuriya, which indeed makes The Lanka Lions Foundation unique.
The Current fund is Approx Rs 25 Million. LCIF too made a pledge of USD 100,000/- to the Foundation, of which USD 25,000/- has already been received.
Up to now, 1,196 loans amounting to Rs. 29,516,450/- have been granted to loan recipients who have been recommended by 118 Clubs, to 1,087 loan recipients.
The current loan portfolio stands at Rs 15,405,447/- among 729 loan recipients. While 436 loans have been settled in full, 92 loan recipients have been granted their 02nd loan and 17 loan recipients have been granted their 03rd loan.
The above number of loans have been disbursed among 828 female loan recipients and 259 male recipients, totaling to 1,087.
While 1,050 of the loans granted are for Income generating activities, 111 loans were granted for House repairs and renovations, and another 35 loans were granted for Education purposes.
The typical 'First time' loan sizes range from Rs 10,000/- repayable in 10 months to Rs 25,000/- repayable in 20 months. All loans are granted a grace period of 02 months.
While the maximum second cycle loan size amounts to Rs 35,000/-, one can obtain Rs 50,000/- on their third loan cycle.
The administration of this loans scheme has been outsourced to a Micro Credit Specialist, who has extensive expertise in the field of Micro Credit, who will administer the project for and on behalf of the Foundation for a fee.
Hence while the Foundation will grant the loans on an Interest free basis to the applicants, a fee of 10% of the loan amount is charged from all loan applicants as an Administration fee.
However the First 150 loans were granted without charging a service fee.
The funds in the Lanka Lions Foundation comprise of donations made by over One thousand two hundred Lions, in multiples of
Rs 12,500/- which have been matched Rupee for Rupee, upto Rs. 5,000,000/- by the Settlor of the Foundation, Past International President Lion Mahendra Amarasuriya.
Loans under this scheme would be granted exclusively through Lions Clubs.
The Lions Club recommending the loan will be responsible for collecting loan instalments and remitting the same to the Process Consultant on a monthly basis.
Loan recipients need to be residents in the area of the recommending Lions Club.
All potential borrowers have to be personally visited and investigated by the club members recommending the loan, before they are considered.
The Lion recommending the loan will be responsible for the collection of the loan instalment, and will become the guarantor of the loan.
(i) The opportunity to assist poor and marginalized people to increase their income or improve their standard of living by granting them a loan from the Foundation, WITHOUT spending personal funds.
(ii) As the fund is exclusively for Lions and Lion Ladies, top priority is assured without delays and red tape.
(iii) The ability to continue granting loans to the deserving poor, as the foundation has revolving funds.
The First benefit to the loan recipients who obtain loans under this scheme is the fact that it is extremely cheap. (Normally marginalized people pay exorbitant interest rates as much as 20% per month for small loans. Here there is only a one time upfront fee of 10%)
The second is that loans will be granted with minimum documentation and inconvenience to loan applicants.
The third will be that, with the on time repayment of loans, loan recipients will qualify for larger loans.
First loan recipient - L/C of Galle
L/C of Dehiwala - Mt. Lavinia
L/C of Moratu Eliya
Selling of Rice Flour - L/C of Ginko Trinco
Grocery owner - L/C of Colombo Somerset
Neth Setha Hos. Employee - L/C Nugegoda Central
Short eat Seller - L/C of Kotelawalapura
Mr. Lasantha Mendis
118/3, Buthgamuwa Road, Kotuwegoda,
0772 497 739