Hongqing Chen
Hongqing Chen, a Portfolio/Risk Manager, recently joined Wokai’s Seattle Chapter. This article is a translated version of this story from China.com.cn
On November 13, 2008, a snow storm cleared the air in the town of Qian Guo County, Jilin, in northeastern China. A peanut farmer named Mr. Song MingJiu woke up very early to travel into town to close his loan. With peanuts growing about 11.5 acres, Mr. Song had earned a pretty good income. This fall, he bought a new pickup truck, which caused his his cash flow to become tight, so he decided to take out a loan. He got it just about 10 days later. "This is the first time I have ever borrowed from a bank. I cannot believe how fast the process was," he explained.
(This photo from Flickr shows a peanut field in Jilin in warmer weather)
The bank that gave Mr. Song a loan is called Sunshine Village Bank. Several banking veterans, among them vice president Mr. Kong XingZhong, founded it just a year ago. Since the bank is located in the town of Qian Guo County, it is still very inconvenient for faraway villagers.
To better meet the needs of the local farmers, Mr. Kong visited peasants’ families almost daily. On his notebook, he recorded statistics such as acreage, types of plants, annual revenue, and the amount of debt a farm could carry. He signed his name to every family note. “Most loans are micro loans, ranging from RMB1,000 to RMB5,000. I was afraid to mess up because I visited so many families everyday.” Mr. Kong explained.
To attract deposits, Sunshine Village Bank targets idle funds from retirees. They sponsor activities with community services to befriend retirees and to provide transportation to the bank. They make micro loans for start-ups and require little or no collateral. They also provide short-term loans to meet cash flow needs with flexible collateral such as grain, fertilizer, machinery, or vehicles. Over just one year, it has attracted over RMB200 million in deposits. For Mr. Song, Mr. Kong regretted that it took him more than 3 days to obtain the loan due to the trouble of finding a guarantor.
According to China's Banking Administration Commission, as of 10/31/2008, there are 62 village banks, five lending companies, and 10 countryside credit unions established in China. There are 35 similar institutions in the process of setting up.
<end of article>
Through Wokai, you can help to fund rural loans for farmers like Siqin. So far, the Wokai community has contributed $270 of the $592 that she has requested to invest in a new pig farm.
Location: Chifeng, China
Industry: Animal Husbandry
My Story:
I am a herdswoman from Inner Mongolia. This year I am 45 years old. My family had four members and we used to be very happy. My elder son is already married, and my younger son works as central heating laborer. He often leaves home for work and his pay is quite decent.
Last year we were struck with misfortune when my husband became sick with an infectious disease and passed away. All responsibilities for our family business and for caring for our home fell to me alone. We had been raising cows for several years and currently have three cows. It's a huge investment as feeding them for one year can cost up to 20,000 RMB. I am having trouble taking care of this business.
However, the current market price of pork is quite high and the physical and financial investment is not as high as for cows. Therefore, I hope to borrow 4,000 RMB to buy 10 pigs and raise them. The returns on pigs will also be faster than they are for cows.
Comments