Many of us have items in or around our homes that we’ve been meaning to get rid of for years. We walk by these things regularly, on our way elsewhere, occasionally thinking, “I really should see if I can sell that thing,” though it can be a while before we take the initiative and make the next step.

Who’s Car is That?

In General Natividad, a village in the Luzon region of the Philippines, a Suzuki “carry vehicle,” once used to transport children to and from distant schools, had been parked in the same spot for years. Broken-down and idle, the repairs necessary to get it running again cost more than the vehicle was worth. It waited patiently, broken-down and idle in front of the local daycare center until someone thought of a better idea. One day, someone did.

Residents of Luzon from 40 households formed a community group with facilitation from Outreach Philippines field staff called “Organization of New Hope in Pulong Visava,” or in their native Tagalog language, “Samahang Bagong Pag-asa sa Pulong Visaya,” — SBPPV, for short. SBPPV is made up almost entirely of unskilled farm laborers who lack their own land from which to generate income, and who, on average, earn roughly $4 US daily, but only during planting and harvest seasons, leaving months-long lulls where earning regular income from farm labor isn’t possible.

Even in harvest months, when income is all but guaranteed, the money covers only the basics, with very little left over to spare. In rainy months, when farm work is unavailable and temporary work in construction or domestic service doesn’t bring in enough money to make ends meet, many families are forced to take out loans from lenders whose interest rates keep borrowers buried, collecting on what’s owed from what little money comes in from the next paycheck, deepening the cycle of debt.

Low-Interest, High Enthusiasm

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Since most group members were affected by unstable sources of income and usurious loans, they decided amongst themselves to prioritize this need above other issues in their village, which would be addressed in future projects. For now, they voted to sell the broken-down Suzuki and use the proceeds to found a community-managed loan fund, benefitting 20 families in Luzon.

Applicants for loans are required to fill out a checklist on a card that lists approved groceries and supplies on which the money can be used. In a nice bit of wordplay referencing the reduction of stress made possible by more expansive access to basic supplies, the community decided to call the system “ReLACS,” short for “Relief Loan Access Card System.” Loans total roughly $22 USD, with half allotted for educational costs (transportation to and from school, supplies, clothing), and the other half earmarked for family groceries and basic household supplies. SBPPV agreed that loans should be repaid within six months, at an interest rate of 10%, or 1.7% monthly.

While this is a small story, it’s emblematic of the difference between the results of Outreach’s unique approach to sustainable change within communities and the results that would likely come from a “hand-out” process to developing impoverished populations. In a community where the broken-down Suzuki was given as a gift with no follow-up to a community who lacked organization and empowerment, it likely would have remained parked and rotting until it was swallowed by the landscape or dismantled for scrap and parts. Instead, SBPPV discussed their options and found a way to capture the remaining value of the vehicle—itself the centerpiece of an earlier project to aid children in their trips to school—and used profits to sustain their progress through a loan program to continue providing benefits to their group for a long time to come.

When members of SBPPV found themselves empty-handed, they chose to feel around for anything they could use to benefit their community, rather than throwing their hands up in surrender to circumstance. Not only did they succeed in doing a little tidying up around their village by selling the inert Suzuki, they found a way to use the proceeds fairly to benefit everyone involved in working to break the cycle of poverty. Together, they will.

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Neighbors from General Natividad celebrate the successful implementation of the ReLACS loan program in the local community center.