Raising Income of Indigenous Women of Kulisusu

through Micro-Credit Assistance

The Kulisusu women are known as hard workers as seen from their activities in agriculture sector, fishing and other informal employment. It can be also seen from diverse economic activities such as processing smoked-fish and dried fish, selling smoked fish and fresh fish, running small kiosks and street vending, etc. Those businesses have good prospects and profits, but they found problem that is lack of availability of working capital. Most of the people are dealing with moneylenders to start their businesses who charge them with 10 – 50% flat rate interest rate per month, and must be paid back on a daily basis. This percentage varies depending on the loan risk measured by the moneylenders. The dependency on moneylenders is considered very high since there were no other sources for financial services in these areas. The Banks only operates at the district capital, which takes one-day trip from the villages. In addition, the requirement of collateral to get loan approval prevents many poor people to get access to banking system.

The business opportunity in Kulisusu area of North Buton is limited so that a lot of people especially men are going out of the villages as illegal workers in other countries such as Malaysia, Singapore and Australia or going to forest for illegal logging. The negative impact of the illegal logging business has affected the community such as regular flooding during rainy season. Moneylenders one again play their role when the clients or borrowers are not able to pay their loans. In turn the borrowers can pay their loan by forest produce such as wood or rattan.  This condition has worsened the North Buton Wildlife Reserve.

Family’s low income has influenced children’s opportunity to have access to education. The latest data showed that 20% of children cannot enter and or graduate from elementary schools, only 30% continued their study to junior high schools, and only 5% continues to senior high schools. In health sector it was also found that 85% of the people in the village choose to go to traditional/indigenous medical practitioners for first aid, and only 50% of them continue go to local community health centers or “Puskesmas” when they cannot cure the disease.

Concerned to the local poor condition, IDRAP has been assisting local community in economic activity through “arisan” approach as an alternative to find capital formation within groups since 1999.  “Arisan” is a collecting some money within group, where the collected money, for instance each month, will be utilized by one of member within group that determined by thrown a lot.  This “arisan” approach has been developed into micro-credit assistance since middle 2004. But as the available capital was small, it made the target beneficiaries was limited. Therefore, IDRAP continuously develops its resources, including looking for potential funds, for supporting the Kulisusu women for having easy access on micro-credit.

The IDRAP's program on micro-credit is purposed to improve the economy of poor families in Kulisusu area by provision of capital support and a continuous assistance to develop new businesses and/or expand their existing businesses.