Since inception, MicroDreams has helped tens of thousands of entrepreneurs in the developing world through its partner organizations. MicroDeams’ support enables small, growth-stage MFIs to access the funds that they will on-lend to local entrepreneurs in the form of working capital, educational or home improvement loans. MicroDreams’ funds enable the poor to access their first meaningful opportunity to advance themselves and their families.

The Microdreams Partnership Model
Partnership
MicroDreams partners with world class MicroFinance organization to provide all of the following to poor families in opportunity starved developing nations around the world.

Micro-enterprise Development
MicroDreams partners provides training, unsecured credit, and ongoing guidance and motivation to poor women for the purpose of helping them to start and grow small income generating businesses so that they can work their way out of poverty.

Childhood Education
MicroDreams partners help to ensure that children receive a proper education by providing financing to their parents to pay for school fees, school uniforms and textbooks.

Housing Improvements
MicroDreams partners help to improve the healthiness of homes by providing financing for basic housing improvements such as obtaining access to electricity, running piped water or proper sanitation or building a secure foundation for their home (in lieu of a dirt floor) or to place a tin roof on their home (in lieu of a grass roof).

Savings
It is expensive and difficult for the poor to open bank accounts at traditional commercial banks. MicroDreams partners help the poor to save for a rainy day and to develop good financial habits by providing a basic savings service. By saving with a MicroDreams partner, members have a safe and convenient place to make small regular savings deposits.

Insurance
MicroDreams partners offers a basic life insurance product. In the event that an insured woman dies, her family receives a benefit from the life insurance product. This assurance of no hardship on the remaining family is something that poor families greatly value.

Weekly Meetings
MicroDreams partners hold weekly meetings in local villages with the local membership. At these meetings, nearly all MicroDreams related business such as training, business plan presentations, loan applications and approvals, weekly loan repayments, savings deposits and ongoing business coaching and mentoring take place.

Peer Group support
All MicroDreams partners members are part of a self chosen group of four to seven women. In each village there may be two to five MicroDreams groups. The members of the peer groups support one another. They are the first line of approval on all new business plans and loan applications. They act as weekly guarantors on all loan repayments and they play a vital role in the ongoing guidance and motivation of each MicroDreams microentrepreneur.

Micro-Businesses
There are a very wide variety of MicroDreams micro-businesses. All of the businesses are based around existing livelihood skills and deliver a product or service for which there is a reasonable demand and around which a profitable business model can be developed.

Building Self-Esteem
The MicroDreams program continually builds self-esteem. By providing the poor with unprecedented opportunity, and helping them to achieve, we instill selfconfidence and a belief that their dreams are within reach. This improved self esteem feeds down to their children. One of the more direct ways that SPBD — a MD partner—builds self-esteem is through its annual business woman of the year awards celebration in which it recognize the efforts and achievements of dozens of top SPBD/MicroDreams entrepreneurs. This event is attended by >1500 and is well supported by the local business community and is a source of pride for all.

Partner Qualification
MicroDreams’ mission is to ensure that partner MFIs remain financially healthy and well capitalized. MicroDreams only seeks the highest quality partners who can demonstrate managerial excellence, client growth and a healthy loan portfolio. Potential partners must meet initial and ongoing financial, operational and managerial standards, and MicroDreams performs extensive due diligence to gauge potential partners’ qualification. Partnership screening includes:

• Analysis of audited financial statements;
• Analysis of loan portfolio, e.g. size, growth, portfolio at risk metrics, loss provisioning;
• On-site assessment of management;
• On-site assessment of operational risks and controls;
• Review of detailed plan to achieve financial self-sufficiency;
• Ongoing assessment of business and portfolio health.

Services
Upon full qualification, MicroDreams will determine the best means of partnering with the MFI to work towards the goal of financial self-sufficiency and sustainability. MicroDreams is prepared to support partners via:

Direct grants: Grant financing is available for specific projects designed to enhance good governance. Examples include grants to upgrade systems, obtain an external audit or rating or support an expansion strategy.

Direct loans: MicroDreams will provide loans to promising MFIs who require funds to support their growing loan portfolio or undertake discrete good governance or expansion projects.

Loan guarantees: MicroDreams will help small MFIs establish quality relationships with commercial financiers. MicroDreams may act as a loan guarantor in order to reduce the risks and transaction costs perceived by commercial lenders.

Bridge financing: MicroDreams provides bridge financing for MFIs that require a short-term loan (3 months or less). An MFI will find bridge financing an effective way to manage shifts in capital structure without shrinking the client loan portfolio.

MicroDreams’ financing services are critical for growth-stage MFIs. Without such support, many small, promising MFIs might be unable to continue deploying funds in their local communities. Entrepreneurs in the developing world rely on MicroDreams’ partner MFIs to access the funds necessary to support themselves and their families.