Micro-Loan Bank In Queens Lets Women's Businesses Thrive
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Two years since a micro-loan bank branched out in Queens, its female borrowers have opened many local businesses and have a near-perfect loan repayment rate. NY1's Shazia Khan filed the following report.At age 27, Nelly Albarracin owns her own nail salon in Jackson Heights, Queens. She emigrated from Ecuador five years ago to make a better life for herself and her family, and being her own boss was fundamental to her dream.
"As women, we can surpass the goals that we have set for ourselves in this country," says Albarracin through an interpreter.
She could not have done it without a little financial help from Grameen America. Patterned after Grameen Bank, which opened in Bangladesh in 1976, Grameen America focuses on giving small, so-called "micro-loans" to low-income women in Queens, Harlem and central Brooklyn.
"To try to get credit in this country is very difficult," says Albarracin through an interpreter.
In the past two years, Grameen America has given loans to 2,000 women to start new businesses. The loans range from $1,500 to $2,000.
"You see a lot of people in the United States, they don’t have any access to any financial institutions," says Grameen America general manager Shah Newaz.
Having worked with Grameen since its beginnings in Bangladesh and helped created branches around the world, Newaz says the lack of access to capital in this country is much like what he's seen in other countries.
Albarracin has obtained three loans at 15 percent interest from Grameen. She used the first to pay for her beauty license. It cost her $112 in interest for the year. The second and third loans helped her buy her salon.
Now, Albarracin has established credit and employs others women in her Jackson Heights community.
"With the loan, I could get my license and pay for it myself without asking for money from my husband. I didn't have to depend on anyone. I was personally paying my interest," says Albarracin through an interpreter.
Even with the recession, Grameen America reports its borrowers have a near-perfect loan repayment rate of 99.5 percent, much like in other parts of the world.
"They have to get the money to pay back, so they're working hard to get returns, and that also helps them to increase their capital and increase their business," says Newaz.
For Albarracin, she hopes that after a slow winter, her own business will pick up this summer.