By Tongngy Kaing, Communication Officer CUFA
In December 2012, CUFA commenced the Reaching an Independent Economic Life (RIEL) Project to assist those relocated as part of Cambodia’s Railways Rehabilitation Project. The aim of the RIEL project is to provide financial counselling to those affected by the move by teaching them how to save and manage money to help them have a fresh start.
Now one year into the project, CUFA’s Communications Officer, Tongngy Kaing who has been working closely with the project since it started, has seen how the lessons provided by the CUFA team have helped families make the right choices in order to help lift themselves out of poverty and achieve a sustainable future. He shares one family’s story.
Poipet, Cambodia: After relocating to the new community, life for Sam Art and her family got off to a good start. The grocery store owner was one of the first to open her stall in her community creating a monopoly on the local market and her husband had successfully started a business selling lottery tickets which was making a steady income.
In order to assist the growth of her business, Sam Art took out a loan with a local microfinance institution and with the funds she was able to increase supplies in her grocery stall which led to more sales. However in recent months, sales have slowed down and dropped by about 50 percent due to increased competition. “There are more new grocery stores now, so many of my customers just go to other shops near their houses. Other people saw my business was running good, so they open their own”, Sam Art explains.
Not only the grocery store has been affected, Sam Art’s husband’s business of selling lottery tickets has also experienced a down-turn due to outside sellers coming into the village along with new sellers starting business in the neighbourhood.
When asked if there was any solution to cope with the increased competition and declining sales, Sam Art replied “At the time I really didn’t know what to do.” However, she did have a solution.
Believing in her entrepreneurial spirit and taking on the lessons learned from the CUFA Project Officers, Sam Art has begun selling breakfast out of her grocery stall to help increase sales. The menu, which consists of fried noodle, rice porridge and pork, has seen her stall serving up to one hundred villagers every morning. The business is running really well and has increased Sam Art’s daily income by $5 each day. Not only has the family’s income increased but also family costs have reduced thanks to being able to eat breakfast at home rather than purchasing meals out. The new business is very profitable for her family and she is optimistic about the business move.
Business has picked up which also means that the household has been busy working to meet demand. Sam Art is up at 5 each morning to prepare for the breakfast rush. Her eldest daughter, who has been working in Thailand assisting her Aunt in her clothes shop, has returned home to help the family business and intends to stay.
Sam Art is more than happy to work hard after taking out a loan with their local microfinance institution to start up her business in June. “We are in debt now, so we have to work hard. I do whatever I can to make more income,” Sam Art explained.
When asked how she is reducing their current debt, Sam Art replied, “My husband and I deposit part of our incomes into a saving box every day. By the end of each month we open the box and get the money out to pay off our loan.” Sam Art elaborated with “I do not want to save now but focus on paying off the debt and building the income from my work,” she said adding that she can still make monthly contributions of $7 to her savings account in the community self-help group.
“The CUFA Project Officer comes to my house regularly to help me and to provide financial counselling and guidance. He recently taught me to keep track of my stock and record my business income and expenses in a table and also how to reduce family costs,” Sam Art explained. While saving is still important to the family, the priority is now to repay the loan as quickly as possible, so savings are directed to repaying the loan. CUFA staff keep a very close eye on the family’s progress to ensure they can manage their household income, expense, savings and debt repayments.
Despite the increased competition for her business, Sam Art’s entrepreneurial spirit and drive to work off her debt, alongside the training and support she receives from CUFA, will ensure that she has no problem repaying the loan she took in June from the Micro Finance Institution.