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Microcredit
 Tostan's microcredit program allows participants to put into practice math, literacy, and management skills learned during their classes. The goal of the microcredit program is to enable villagers, particularly women, to start small projects that improve their quality of life and general well-being. Tostan teaches leadership skills, basic financial management, and ways that participants can tell whether a project has good chances for success.
Microcredit projects can help
reduce poverty in rural villages and
reinforce community solidarity. An important part of Tostan's holistic approach to development, microcredit also encourages participants to
save and plan for the future. Other aims of the program include: increasing women's roles in their families' economic decisions and encouraging communities to form partnerships with outside organizations such as NGOs, donors, and microfinance institutions through Tostan's Empowered Communities Network (ECN).
Tostan's microcredit program is based on a
group-lending, revolving-funds system inspired by the Grameen Bank model in Bangladesh. The program began in 1999 with a $5,000 grant from then First Lady Hillary Rodham Clinton, made during a visit to a village in Senegal. The program has since expanded to six regions, with 311 communities receiving microcredit funds.
 Administered by the local Tostan-trained Community Management Committees (CMC), the small loans range in size from $300–$1,000 per community. Before distributing the funds for each loan cycle, Tostan takes 15% out of the total loan amount; ten percent goes to the CMC Community Solidarity Fund to support community-development projects. The remaining five percent is spent on administrative costs such as transportation and follow-up supervision.
CMC members decide if the loan will be used for collective projects or divided among community members. If divided, the average loan size ranges from $20–30, depending on the number of participants. Tostan never charges CMCs interest on the loan and lets the CMC decide which interest rate (between 10 and 15%) to charge to borrowers.
Participants typically invest in activities such as agriculture, fabric dyeing, animal husbandry, soap making, or small business ventures. Occasionally, loans are given to village groups that engage in larger-scale income-generating activities such as starting a community vegetable garden or market, or purchasing a mill to grind grains.
Profits from microcredit activities are often invested in projects that reinforce community health, education, and well-being. Microcredit funds made possible the construction of a health center in the village of Soudiane, the installation of a water pump in Kebeum, the addition of a primary school classroom in Bona, and the launching of a women's dairy cooperative in Aby Siré Ba.
A Tostan Microcredit Success Story:
All of the local women are participating in income-generating
activities, selling spices and vegetables or raising chickens and
goats. Before the Tostan program, it was unusual for women to work
outside their homes, but now women are earning money and are able to
buy things for their households. By donating some of our profits,
we have also started a community savings account that can be used for
medical emergencies or to finance community projects and have opened
a 900,000 F CFA ($1,800) line of credit with FDEA (a Senegalese
national microfinance organization).
—Mariama Seck, participant from Keur Sanou, Thiès, Senegal
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