Women and Credit – Part 2: Women Start a Revolving Loan Fund

AgricultureGender equality

Notes to broadcasters

The numbers quoted in this script are expressed in American dollars.  Please convert them to local currency.



Program host.
Woman farmer.
Woman farmer, Sylvia’s friend.

Program host:
In our last program, we listened to Sylvia and Joyce as they discussed different types of credit that are available to women farmers. They also talked about how women might use the money they borrow to earn extra income from their farms. Today, Sylvia and Joyce are talking about another way to borrow money — called a revolving loan fund. Let’s join them again now to find out how you can set up a savings and credit program with other women in your village.


Joyce, we have talked about starting a credit program with our neighbours, and most of them agree that it’s a good idea. But since we have no money for credit, how do we get started?

We could set up a revolving loan fund.

How does a revolving loan fund work?

Let me tell you a story about a woman named Patricia who lives in the Philippines. She was a widow with eight children to feed and no income. She started a revolving loan fund with ten women in her village so that they could sell mushrooms at the local market.

Each woman in the group started out by saving 12 cents each week. At first it was hard, but they encouraged each other. In five months, the women had a combined savings of $22.

They set aside $15 for a revolving loan fund. Each woman had a turn to borrow $2.50 from the fund to develop a small business. Patricia began growing mushroom to sell in the market, and earned 66 cents a day.

If a member of the group repaid the money she borrowed within two weeks, she did not have to pay an interest charge. After two weeks, she had to pay 22 cents extra on the $2.50 loan.

The women set aside the remainder of the fund for emergency loans. Members could take out loans to pay for a visit to the doctor and some antibiotic medicine for their children.

Was the revolving loan fund a success?

Yes and no. Patricia and the women learned many lessons about how to run a revolving loan fund. The first problem they faced was that too many women were asking to borrow money for emergencies which they were not able to repay. Also, the women did not add savings to the fund to keep it going. Eventually, there was no money left in the fund.

So they held a meeting and decided they could only borrow money to put towards activities that would earn them extra income.

After that, the women were able to manage the revolving loan fund with more success. As each member earned an income from her business, she continued to put savings into the fund each week, until the group had saved $44.

Patricia’s credit group was always looking for new ways to save. In addition to their loan fund, they began sewing aprons from flour sacks, which they sold to local vendors. Before long, they had more orders for aprons than they could make!

The women in Patricia’s revolving loan fund used their credit to start businesses, but women could also use loans to buy and share large quantities of items they need for their homes and farms. Eventually, they could use the money to help pay for their children’s schooling, or to escape from their debt to money lenders.

MUSICAL BREAK (Upbeat music … fades as program host begins speaking)..

In the next few months Joyce and Sylvia organized a revolving loan fund with a group of women in their village. Each woman in the group agrees to certain conditions when she joins the fund — such as how much money she may borrow; when the loan must be repaid; and the amount of interest charged on the loan. Each month, the members of the group contribute a small amount of their savings to keep building the fund. A few months later, Joyce and Sylvia meet in the market …

Hello Sylvia! I see that the water pump you purchased with the money you borrowed is helping you to grow more vegetables.

And I was able to pay back the money to the revolving loan fund. Next time it’s my turn, I’m going to buy some materials for my vegetable stall.

We only started with a few women in our revolving loan fund, but many more want to join now that they see how it works.

We have been successful because we keep careful records of everyone’s contributions, we encourage each other, and we are honest.

We have gained respect in the village because we make all our agreements at group meetings and we take careful notes. The group meetings also give us a chance to share our stories, discuss our problems and take action to improve our lives.


Script adapted by Noelle Grosse, Researcher/Writer, from “Women start a loan fund,” DCFRN script 49-2, by Helen Hambly Odame, Associate Officer, International Service for National Agricultural Research (ISNAR) PO Box 93375 AH, The Hague, The Netherlands.

Reviewed by:  Helen Hambly Odame, Associate Officer, International Service for National Agricultural Research (ISNAR), The Hague, The Netherlands.

Information sources

Case study of Patricia Patring adapted from Marianita Villariba, “Spirit and Spunk,” Women in Action, No. 2, 1996.

“Guidelines for financial management of a savings and credit group,” abstracted from Aloysius Prakash Fernandez, The MYRADA Experience: Alternate Management Systems for Savings and Credit, MYRADA, 1994.  MYRADA, No. 2 Service Road, Domlur Layout, Bangalore 560 071 India.