Loans Provide Opportunities to Succeed

KOKAN JAND, TEHSIL GOJAR KHAN, RAWALPINDI DISTRICT, PUNJAB PROVINCE, Pakistan – Mohammad Shafiq started business in the dark, literally. Not only did the 35-year-old know little about mobile phone repair, but he also launched his tiny enterprise on a street without light.

“All I had was a table by the road,” Shafiq recalls, “so after the sunset, I couldn’t continue my work.” Shafiq persevered this way for a short while in 2002 before learning about a loan program run by Pakistan Poverty Alleviation Fund (PPAF).

The government of Pakistan created PPAF to provide loans, grants, and technical assistance to the poorest individuals and communities in the country. PPAF is mainly funded by $891 million in credits over time from the World Bank.

With his first loan of 15,000 rupees ($163), Shafiq opted for a training program on mobile phone repair and purchased some tools. After he gathered more clients and managed to repay the first loan, he applied for a second loan of 17,000 rupees ($184).

As more rural neighbors overcame the technology divide, Shafiq’s business slowly grew.

A third loan of 20,000 rupees ($217) helped him pay the rent of a shop near Kokan Jand village, about 70 km from Islamabad. His concrete cubicle sits in a long row of retail outlets offering everything from carpentry to grocery.

Next, Shafiq learned photography during a brief work trip to northern Pakistan with his cousin and returned home determined to apply this skill as well. “I was hard-working,” he explains. “I wanted a better life for my baby.”

Shafiq kept expanding his business, first by purchasing a video camera to film village functions. Then added a picture printing service.

It’s been a decade since Shafiq started business on the street, and he’s proud to say that he’s functioning independently now. On average, he earns about 25,000 rupees ($272) a month, and more during wedding season. With this income, he now can comfortably support his wife and 4-year-old son.

Asked where he might have been today without PPAF loans, Shafiq says, “I probably still would be sitting on the road with almost nothing. I would be very poor.”