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Micro-credit is understood as the provision of small loans to individuals, to help them finance income-generating activities or set up small businesses.  In Canada, much of what is practiced in micro-credit has been learned from the experience of the Grameen Bank in Bangladesh, and from the pioneering work of the Coady Instititute.

There are many forms of micro-credit in Canada, from the peer based model of Grameen, to immigrant loan funds provided by many settlement agencies in partnership with financial instititutions, to individual character based loans provided by community loan funds and credit unions.

What have our collective lending practices taught us about micro-credit: how to evaluate an individual's ability to carry credit, how to structure lending and what flexibility is required, how to manage lending that isn't evaluated on traditional "credit-scoring" metrics?  And what is acceptable risk for a financial institution to take?

'''Newcomer feels acceptance, encouragement from IAF loan'''

In July of 2008, Dianna Kageni Mbari and her husband arrived in Edmonton, full of optimism about their future in their new chosen home. Dianna had left a good job in Kenya. She has a Bachelor of Education in Home Economics and a Master of Science in Entrepreneurship.

When Dianne arrived in Edmonton she had over eight years’ experience in program management and coordination with international non-profit organizations delivering community and health programs. At one point, Dianna oversaw programs that provided access to education and other essential community services to over 150,000 families, and orphaned and vulnerable children. 

“I thought I could get work that reflects my training and experience,” she recalls. “To my surprise, I could only get an entry level job.” It’s a familiar story to many immigrants. Without Canadian experience and training, employers are reluctant to hire newcomers in positions other than entry level. Dianna was very disappointed. 

“We felt really desperate,” she says. “We came to Canada to pursue better opportunities in life, our careers and our education. But we felt that we weren’t needed here and we questioned our decision to come to Canada.”

Not one to give in easily, Dianna spoke to a career counsellor at the Edmonton Mennonite Centre for Newcomers. The counsellor encouraged her to take a one-year project management program at NAIT to complement her African experience. 

It sounded good, but the issue of funding still stood in her way. She didn’t have the money to take the program and had no credit history in Canada. Her counsellor recommended that she apply for an Immigrant Access Fund (IAF) loan.

“I immediately completed the application form, but I didn’t expect to get the loan because I lacked credit history in Canada,” Dianna says. 

Within a week, Dianna received the good news that she’d received her loan. She encouraged her husband to apply too, so he could get Canadian training in his field of architecture. The same scenario unfolded for him. He received his loan within a week, too. 

The experience with IAF totally changed Dianna’s perception of Canada.

“I felt loved and cared for,” Dianna says. “We feel we are part of the Canadian family, like we are really accepted.” Dianna is taking the NAIT project management program and working with the Red Cross Disaster Management as a community coordinator. She expects to pursue her career in project management, as she will have gained the Canadian training and perspective that will allow her to apply for more senior positions.
“Wow,” she exclaims. “This really is our home!”

'''Shadi’s Story'''
Shadi immigrated from Jordan in January 2006. He worked as a chemical engineer in Jordan and had experience as a quality control engineer. He was unemployed and attending courses to better prepare him to work in Canada when he learned about a 10-day course in Oil and Gas Production Operations. He obtained employment in his field shortly after taking the course.

Employment when applied for loan: unemployed; 
Earning when applied for loan: $0 (living on savings); Amount borrowed from IAF: $3,250; Cost to provide/administer loan: $3,994 (est); Current work: Project coordinator with an oil and gas engineering company; Currently earning: $75,000 annually (estimated).

'''Paul’s Story'''
Paul immigrated from Nigeria in 2004 with a BSC degree in accounting (and five years’ experience as an accountant) and an MBA in marketing (with 1.5 years’ experience).  He is married and has three young children; the family was in dire need when Paul applied for his loan (the IAF loan delivery partner referred the family to the Food Bank). The IAF loan helped the family with their living expenses while Paul attended the "fast- track" Oil and Gas Production Accounting Program at SAIT (as suggested by the Canadian Association of Petroleum Production Accountants). This was a full time program complete with a practicum, which ended in August 2006.
 
Employment when applied for loan: Fabrication supervisor; Earning when applied for loan: $16/hour ($33,280/annual); Amount borrowed from IAF: $5,000; Cost to provide/administer loan: $5,994 (est); Current work: Accountant; Currently earning: $121,000 annually (confirmed).
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