Microloans in the Refugee Camps in Lebanon

Rebuilding livelihoods in Nahr el Bared Camp, North Lebanon

From May to September of 2007, high-intensity fighting between the Lebanese Army and the Fatah al-Islam group caused the displacement of the entire population of the Nahr el Bared Palestinian Refugee Camp, located North of Tripoli. The camp, which was established to shelter refugees in the aftermath of the 1948 war in Palestine, had developed into an economic hub in north Lebanon and held a population of 30,000. The 2007 conflict caused the destruction of 85% of the camp’s infrastructure, including the electricity grid, sewage and water mains, roads and the vast majority of commercial and residential buildings. Economic activity was halted, and household earners were left without a source of income.

In 2008 Welfare Association began a 4-year project with a grant from the Big Lottery Fund to provide urgent support (for maternal health and mental health ) and support for livelihoods (including microloans, career counselling and training for graduates) to help the camp residents get back on their feet.

The microloans have been very successful with a wide range of businesses supported. The small loans were most commonly used to fund the addition of stock, or employees or a premises move, and were able to increase the loan recipients’ monthly income, and this then improved their families’ standard of living. There was a very high repayment rate, which has allowed for a revolving fund to be established. The revolving fund will continue to be managed by our partner NGO and will increase the impact of this activity further.

The businesses supported were wide ranging and full assessments were conducted before loans were made. The successful loans were made to men and women with small businesses including:

rechargeable phone cards business, cellular phone shop, purchase of a school bus, grocery shop (female), aluminium shop, electrician, bags and shoe shop (female), grinding and drying vegetables business (female), wholesale grocery shop, pharmacy: to purchase medicines to boost stock, pharmacy: to purchase cosmetics to provide more variety, clothes shop and a butchers shop.

Microloan_recipients_new_shop-220.pngMicroloan recipient's new shop
The WA project coordinator carried out post-loan evaluations. The following examples highlight loan funded activities and the benefits brought to loan recipients’ families:

  • Ghassan, 40, purchased a minibus to transport students during term time, in the summer months he takes groups on trips. His income increased by 60% per month. Previously he had needed support from NGOs and UNRWA. Now he is able to support his family, including two children, his wife, and his elderly parents, without additional support. The extra income has allowed him to buy a car that he rents to people in the camp, further increasing his income.
  • Munir 44, married with a family of 9, improved his photography business. As he mainly photographs weddings, his work is seasonal. He works at 3-4 weddings per month in the winter, and photographs 3-4 weddings per week in the summer. His monthly income has increased by a third.
  • Ziad, 30, is married with a family of 6. With his loan, he improved his stationery shop and his monthly income increased by a third, he anticipates further increase as families continue to return to the camp.
  • Sharif, 23, single, lives with his family of 8. With his loan Sharif improved his clothing shop for men and women. The shop was so successful that he opened a second shop. His monthly income more than doubled!
  • Leith, 26, lives with his family of 7 people. He used his loan to make improvements to his restaurant. His monthly income has since increased by 25%, this allowed him to complete repairs and renovations on his house and open a small butcher shop. This will further increase his income.
  • Mona, is a 30-year-old female living with her husband’s family. She used her loan to help improve her minibus business, which employs one person. Her monthly income more than doubled and she is now able to support her family.