Microcredit built for Indigenous, rural women in Guatemala

Friendship Bridge clients are primarily Indigenous Maya who come from rural communities with high poverty rates. They face systemic exclusion due to overlapping factors of gender, ethnicity, and geography. As a result, they continue to be denied many basic rights.

The women in the communities Friendship Bridge serve are considered too “high-risk” for traditional banks. They are not served by the formal financial sector due to the small loan sizes they seek, inadequate collateral and credit history, and their lack of proximity to financial institutions—many traditional banks do not have branches or service locations in the rural communities of our clients because banks view these locations as unprofitable or too risky to serve.

However, Friendship Bridge’s financial services are built to serve these same women. Unlike banks that require physical collateral such as property or savings, Friendship Bridge’s Trust Bank group lending methodology is based entirely on trust. Each client in a Trust Bank (group of women entrepreneurs) guarantees one another’s loans through mutual accountability. This model provides access to credit for women who often have no assets, credit history, or formal employment—and who would otherwise be excluded from the financial system.

We believe that microcredit must be combined with education and preventive health services to help clients build resilience and pursue their chosen opportunities. We call this approach Microcredit Plus: clients who borrow can also take part in our other services.