MICROENTERPRISE - How does it work?

We can change the world, one family at a time.

Microenterprise provides a hand up, not a hand out, to the poor in developing countries who want to establish businesses and become self sufficient. Loans average around $100 to $200, and when repaid the money is recycled again and again to help others start their own enterprises.

Microenterprise is a proven way out of poverty.
The lives of millions of the world’s poor have been transformed by people like you.

TEAR Fund Microenterprise philosophy:

• Affirms the dignity and inherent value of every poor person.
• Provides business loans, training & mentoring to create jobs for the poor.
• Creates Self Help Groups empowered to solve community problems.
• Receives matching grants which multiply gifts that are then reused as funds are reloaned.
• Is motivated by a Christian response to serve the poor.

For more information on supporting TEAR Fund Microenterprise please phone us on 0800 800 777 or email microenterprise@tearfund.org.nz

What is Microenterprise?
Microenterprise is the provision of small, fair credit loans to the poor to establish small businesses. As these loans are repaid, they are loaned again, creating a sustainable cycle of development. No hand outs, just a hand up. 

Is it effective?
Microenterprise is one of the most effective ways to lift families out of poverty in developing countries. Loans from as little as $50 transform lives. Our Microenterprise programme has been running for almost 20 years with loan repayment rates of up to 98%, creating tens of thousands of jobs. As businesses take shape the first to benefit are the children.

How does it work?
Many of the world’s poor are self-employed. They sell and raise livestock, run market stalls, produce handicrafts and recycle rubbish.

The major problem these enterprising poor face is their lack of working capital. The World Bank estimates 600 million of the world’s poorest could create jobs and increase their incomes if they had access to affordable financial services. Today only 3% have access to fair credit. In many countries the formal financial sector does not extend to the poor. These people are left to raise credit from informal moneylenders, who charge exorbitant interest rates, sometimes as high as 1600% per annum.

Microenterprise seeks to address this problem by extending small, fair credit loans (typically $50 to $1000) and other financial services to poor borrowers for income generating, self-employment projects. This allows the poor to improve their standard of living for their families and their communities.

Microenterprise is more than just extending credit loans. It also:

• Provides mentoring
• Gives financial advice
• Provides marketing training and leadership development. 
The small business entrepreneurs work closely with trained loan officers who help them with their business.  The focus is also not just on the financial improvement but a holistic approach. The impact of allowing these poor entrepreneurs access to fair credit provides them with the ability to make a lasting improvement as the increased income will enable them to afford food, shelter, education and healthcare.  Other changes would include increased personal development, ability to offer community service and provide more jobs and a more self-sufficient community.

Giving to Microenterprise


For $25 a month you can contribute towards a loan that will start another entrepreneur on the road to dignity. You can help change the world for one family - and your donation will be re-loaned to help many more.

Click here to donate