#### STICHTING BAKENS VERZET

#### 1018 AM AMSTERDAM, THE NETHERLANDS

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T.E.(Terry) Manning,

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Homepage: http://www.flowman.nl

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## MODEL FOR SUSTAINABLE SELF-FINANCING INTEGRATED RURAL AND POOR URBAN DEVELOPMENT FOR THE WORLD'S POOR

Incorporating innovative social, financial, economic, local administrative and productive structures, numerous renewable energy applications, with an important role for women in poverty alleviation in rural and poor urban environments.

"Money is not the key that opens the gates of the market but the bolt that bars them"

Gesell, Silvio The Natural Economic Order

Revised English edition, Peter Owen, London 1958, page 228

Edition 12: 31 October, 2007

(EN FRANÇAIS)

### RECYCLING OF FUNDS FOR MICRO-LOANS

GRAPH SHOWING DEVELOPMENT OF MICRO-LOANS .
THE INTEREST-FREE LOAN CYCLE.
HOW THE ORIGINAL SEED LOAN MONEY IS USED.

The funds recycled over the first period of ten years are approximately Euro 16.000.000. This is a very conservative estimate.

They are made up of:

a) A payment of about Euro 0,60 per user per month into the Cooperative Local Development Fund. Where seed funds are in the form of an interest-free ten year loan, these monthly payments make up the interest-free seed loan repayment. These are shown as horizontal lines at the bottom of the micro-loans graph. They are constant. During quarters 42-45 the amounts left for repayment UNDER THE PROJECT are reduced to zero. However users continue to make monthly contributions on their own account, so the recycling of funds will in practice continue. The capital fund will build up again as shown in the micro-loans graph. It will drop again when replacements of the original capital goods are made or the system services extended. It will then build up for a third time to cover further collective capital investments and so on for so long as the users continue making their monthly contributions. Where the initial project is in the form of a grant, the large amount of capital which has built up in the Cooperative Local Development Fund can either be used for interest-free micro-credit loans for productivity increase. However, project management may also make proposals for the extension of the services available to the users.

b) Certain capital sums such as repayments for the gypsum composite factories, the mini-briquette manufacturing units, the buses and vehicles, and project and maintenance reserves.

c) Repayments under the micro-loans. These are seen as diagonal lines in the micro-loans graph. Towards the end of the project period, payback times are shortened to ensure capital re-enters in time for repayment of the original seed loan.

Forward: 7.70 Budget in form often required for funding applications.

Back: 7.50 General observations on the budget.

Menu group 7 work files: Financial justification.

Main menu for project work file groups.

Complete index of the project work files.

Main menu for the Model.

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