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1 Mar 2012 - by A4ID

Hand in Hand: working to form and grow businesses in developing countries

A4ID lawyers provided legal assistance to Hand in Hand, who work for economic and social empowerment by supporting the development of enterprises and jobs and the generation of higher incomes.

Background

Enterprise Incubation Funds have now been formed to provide additional capital to help these businesses flourish, especially in countries where SHG members have difficulty accessing business loans.  They are intended to provide credit, alongside the comprehensive business support, until members are ready to transition to commercial micro-finance institutions and banks.

Hand in Hand seeks investors for these funds, allowing investors the opportunity to help poor farmers and micro-entrepreneurs, who are mostly women, start their own business.  In order to facilitate these loans, agreements have to be drawn up and contracts are required to even allow discussions regarding investment to continue.  Hand in Hand need to establish the relationship between themselves and the investor,protecting their interests and the work they seek to do, and securing the impact of the Enterprise Incubation Fund.

Hand in Hand

One way to eliminate poverty is through the formation and growth of local social enterprises, encouraging communities in developing countries to start sustainable businesses and create their own jobs.  Hand in Hand work for economic and social empowerment by supporting this development of enterprises and jobs and the generation of higher incomes.

Through encouraging communities to form Self Help Groups (SHGs), they are able to provide initial training, followed by business training, as well as credit management for those who need it.  The business created is then developed alongside a Business Development Officer, adding much needed income to many families.

Hand in Hand with A4ID

A4ID provided Hand in Hand with a team of experienced finance lawyers, who quickly put together a loan agreement to be used as a template for the organisation.  This not only assisted in the facilitation of negotiations with a recent investor, but provided a reliable template for future loan agreements:

“The legal advice has helped Hand in Hand professionalise and develop their loan-making capacity. It has put them in a more confident negotiating position, and has helped their reputation with investors.

Dorothea Arndt, Hand in Hand

The free legal advice provided has not only developed the organisations capacity internally, but has also allowed for resource to be better directed elsewhere, especially regarding time, staff and monetary expense.

With the charity working toward several of the Sustainable Development Goals (SDGs) – eradicating poverty, empowering women, facilitating education, and developing a global partnership for development – the work of A4ID has proved invaluable and impactful in allowing the pursuit of these goals to remain undeterred.

From the provision of a simple legal document comes the potential for hundreds of new jobs and the establishment of many more loan agreements, with the Enterprise Incubation Funds fulfilling their role in allowing the entrepreneurial SHGs launch their life-changing businesses.

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