Malawi

Economy:
One of the world's least developed countries, Malawi's average annual per capita income is just $600. Some 65 percent of the population is considered poor and 29 percent live in dire poverty. Agriculture employs 90 percent of the workforce and accounts for 40 percent of the $7.6 billion GDP. A severe drought in 2005 left more than five million people in need. Nearly one million Malawians live with HIV/AIDS.

Each day in Malawi, 300 people become infected with HIV/AIDS. In a country of approximately 13 million people, almost 15 percent of all individuals between the ages of 15 and 49 are infected. People suffering from HIV/AIDS-related conditions occupy more than 70 percent of all hospital beds. Life expectancy, which was once thought to be as high as 55, has dropped to 37 years. The terrible toll of HIV/AIDS, which can result in more than 80,000 deaths in one year alone, is not limited to the suffering of the sick and dying. It has created a generation of orphans, and severely undermined national efforts to lift the country out of poverty. Many FINCA clients care for one or more orphans. Just 38 percent of the 156,000 Malawians who need antiretroviral drugs receive them.

Malawi's economy depends on substantial foreign assistance from the IMF, World Bank, and donor nations. Despite major challenges, the government has been able to improve the overall economic climate.

Climate for microfinance:
• Poor and rural people have very limited access to financial services; the few commercial banks tend to focus on businesses in urban areas.
• Microfinance institutions are an integral part of the financial system. They are not currently regulated but the framework is gradually being put in place.
• With significant donor support, several microfinance institutions have begun to reach scale and sustainability and are expanding their services.

FINCA Malawi is headquartered in Blantyre and serves all 28 districts in the country. Research has shown that incomes are at least a third higher in the FINCA family, often making clothes, medicine and school fees attainable.

FINCA Malawi partnered with the Johns Hopkins Bloomberg School of Public Health's Center for Communication Programs to pilot test its Village Banks as a means of disseminating HIV/AIDS prevention and behavior change messages. The pilot program, funded by the Bill and Melinda Gates Foundation, resulted in measurable changes in behavior, and a better understanding of the disease and its transmission. Almost 15 percent of Malawians between the ages of 15 and 49 are infected with HIV/AIDS. (Please note that, while FINCA programs focus exclusively on microfinance, we continue to develop services that will ensure our clients succeed in their small business efforts.)