A woman in her store.

Benefits of Microenterprise in Developing Countries

Poverty has a devastating grip on nearly half of the world’s population, and extreme poverty has stripped the hope from more than 1.3 billion people. The “poverty cycle” is a concept that describes how generations can be caught up in poverty and kept there for decades with no way to break free.

Envision the following: Your family doesn’t have enough money to access basic things like water, sanitation, education, food, electricity, or healthcare, so you go in search of work to pay for these things. You’re exhausted from a lack of food, but you persevere in the hope you can turn things around. Right away, you face rejection because your educational level isn’t considered sufficient. You wanted to remain in school, but your parents couldn’t afford it. Within a few days, your search for work has to be put on hold because of an illness. It’s likely something connected to the poor water and sanitation in your community, the contaminated water you must rely on, or the fact that last night’s rain leaked through your patchwork house’s porous roof. You don’t have access to healthcare, so you just get sicker and sicker. Eventually, you just give up.

For families across the globe, this terrible life of poverty is a reality, and because the setbacks faced by parents play out in the lives of their children, only outside intervention with a long-term impact can break the cycle. A handout may be able to address a poor person’s immediate needs, but it takes a program that makes families self-sustaining to pull people entirely out of the mire that has trapped them.

Microenterprise loans are an effective way to help families and entire communities pull themselves out of poverty for good. Read on below to learn more about how these small-business loans improve lives. 

Key Takeaways:

  • Nearly half of the world’s population lives on less than $2.50 per day, and an astonishing 1.3 billion live on less than $1.25 per day.
  • Living in poverty has a ripple effect on every other aspect of a person’s life.
  • Many families are ready and excited to break the poverty cycle and become independent — all they need is a gift of grace.
  • In 2021 alone, Cross Catholic Outreach provided 176 families with life-changing loans totaling more than US$75,000.

What Is Microenterprise?

You may have heard the proverb “Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime.” Unfortunately, it’s now much more complex than simply teaching a man to fish. To become truly self-sufficient, a family may need fishing rods, bait, nets, and perhaps even a boat. This is where Cross Catholic Outreach and our in-country partners come in. Working together, we provide families with farm animals, agricultural support, or small loans that help families enjoy long-term prosperity. Our ultimate goal is for families to become fully independent so that they no longer have to rely on food or other temporary support. With help from our amazing donors and partners, we were able to provide the following in 2021:

  • Grants: 19 grants over 8 countries
  • Microloans: $76,785
  • Families Supported: 176
  • Pigs Provided: 113

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What Types of Businesses Are Started With Microloans?

Part of our work with partners in developing nations is focused on helping their constituents discover their potential and achieve their goals. Many families stuck in the poverty cycle dream of escaping their plight with hard work, but they also realize starting out on that journey will require an investment they cannot produce. With start-up funds and/or animals provided, however, these enterprising individuals can finally overcome that “start up” hurdle and lift themselves and their families out of poverty. Some of the businesses started with Cross Catholic Outreach’s support include:

Cross Catholic Outreach’s microenterprise activities also provide job training for eager individuals, allowing those from a poorer background to break into highly lucrative industry trades. We also provide entrepreneurs with information and resources on how to launch and run a small business. And for families who focus on farming, we provide education on how to be more productive when working the land. This education allows farmers to receive a higher crop yield, and the excess crops can be sold for a profit. This extra money can be used to buy household necessities, pay for advanced education, or even start another venture. By supporting Cross Catholic Outreach, you are providing a new start to families in the poverty-stricken regions of Africa, Southeast Asia, the Caribbean, Mexico, and Central and South America. 

A woman in her storefront.

How Does Microenterprise Support Women?

Poverty disproportionally impacts women and children, so they are prime candidates for our microenterprise efforts.

Globally, women earn about 20% less than men. In the most impoverished communities, the gender wage gap hinders women from full economic participation. Even worse, in 18 countries, husbands can legally prevent their wives from working. This not only harms the economy, but it also traps women in abusive relationships and leaves them and their vulnerable children in an unsafe environment. 

To address these hardships, Cross Catholic Outreach has specifically tailored economic development programs to support women. We provide microloans to women unable to access the traditional banking system in their country. We also provide training on how to successfully run a small business. By including women in economic activity, they are given an opportunity to improve their lives and the lives of their children.

We feel rewarded in this effort every time the eyes of single mothers light up as they share how they’ve been able to provide for their children with the profits from their small businesses. Whether it is food on the table, life-saving medicine, or school fees, these women are proud of their ability to be successful breadwinners and support their children’s future. 

How Can I Help?

With your support, Cross Catholic Outreach can continue its work of providing microloans for poor families worldwide. We work with our trusted network of compassionate Catholic partners, and they are standing by — the only thing they need is financial resources to support the entrepreneurial spirit of their constituents. Your gift could help purchase chickens for a family, fund a bakery, provide high-quality seeds to farmers, or even start a talented tailor’s home business. Your support will build businesses that stand as a testament to God’s love for the whole community. This Christmas season, help us share the gift of God’s love by uplifting the poor in Christ’s name. For more information about how you can help, please click below.

Proceeds from this campaign will be used to cover any expenditures incurred through June 30, 2023, the close of our ministry’s fiscal year. In the event that more funds are raised than needed to fully fund the project, the excess funds, if any, will be used to meet the most urgent needs of the ministry.