What is Water Credit

  • The US-based NGO Water.org, through its Water Credit initiative, had since 2003 supported microfinance institutions and NGOs in India, Bangladesh, Kenya and Uganda in providing microcredit for water supply and sanitation. 
  • Water Credit did not subsidise interest rates and typically did not make microcredits directly.
  • Instead, it connected microfinance institutions with water and sanitation NGOs to develop water and sanitation microcredits, including through market assessments and capacity-building. Water Credit
  • Only in exceptional cases did it provide guarantees, standing letters of credit or the initial capital to establish a revolving fund managed by an NGO that was not previously engaged in microcredit.

Working of Water Credit

  • Water Credit is a powerful solution and the first to put microfinance tools to work in the water and sanitation sector.
  • Water Credit helps bring small loans to those who need access to affordable financing and expert resources to make household water and toilet solutions a reality.

Here’s how it works:

  • We identify a region where people need access to water and sanitation and that is ready for a microfinance solution.
  • We partner with carefully selected institutions to provide affordable financing for water and sanitation to families in need.
  • These microfinance partners establish water and sanitation loans in their portfolio of offerings. We support them by providing technical assistance, connections and resources to get them started.
  • People in need use these small, affordable loans to put a tap or toilet in their homes and access local resources to do the work.
  • Every repaid loan can be lent to another family in need of safe water or sanitation.

A long-term solution for families in need

  • It’s smart, simple and sustainable. More importantly, it helps the people we empower solve their immediate need and continues to enrich their lives long after the original loan has been repaid. This solution works because it recognizes people as consumers with autonomy and empowers people to define their own futures.
  • Through WaterCredit, women who previously spent hours each day collecting safe water have time to pursue education, work and keep their families safe and healthy. That’s the power of water.

Source: Water.org

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