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RURAL COMMUNITY DEVELOPMENT AT JABAL AL HOSS Mahmoud Asaad UNDP-SYRIA. Workshop on Microcredit-Financing and Poverty Alleviation in OIC Member States Istanbul, 9-10 July 2007. Jabal Al Hoss is in the south east of Aleppo.

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Mahmoud Asaad


Workshop on Microcredit-Financing and Poverty Alleviation in OIC Member States

Istanbul, 9-10 July 2007

  • Jabal Al Hoss is in the south east of Aleppo.

  • 2. 250.000 person live in the area, most of them are under the poverty line.

  • 3. It is 157 000 hectare.

  • 4. There are 156 village and farm.

Why Jabal Al Hoss?


Annual average rate of rainfall 150 - 250 mm.

Shortage of drinkable and irrigation water.

Volcanic rocks cover %23 of the total area, and can't be reformed.

%55 of the lands need reform.


bought and kept in semi covered tankers which endanger it to pollution.


%46.3 of population live in a single mud domes.

This dome is a multi purpose house.

People work in:

Agriculture :

rainfed crops.

Barley, Cumin, Wheat, Lentil

%40,2 of the villagers are landless.

Livestock keeping :

sheep, goats and cows.


%40 of the population migrate for (2-3months).

%3.5 migrate for more than 6 months.

Population Demographic Indicators

Population growth rate %3.4

%51 of them under 15.

Illiteracy rate at the age of 13and above %58 and it is higher among women.

Household average size is 9 person.

Dependency ratio 4.5% person

Access to Credit

  • Moneylenders from informal credit markets charge very high interest rates( 75 %(.

  • 15 % can access money from formal credit markets.

  • 85 % can not access money from formal credit markets : religious, complex procedures, no physical collateral.

Rural Community Development project (RCDP ) in Jabal Al-Hoss

is a joint project of the Ministry of Agriculture and UNDP.

It was approved in 1998.

Implementation started in 2000.

The first Sanduq was established on September, 2000.

Project objective

Establishment of a sustainable network of self-reliant local microfinance institutions (sanadiq) to finance employment-generating small and micro enterprises.

Target group

Low-income people, the underemployed and the unemployed - men, women and youth.

Shareholders in the village funds at Jabal Al Hoss.

Project period

Phase one: 1999 - 2002

Phase Two: 2003-2007

Financial Resources: 1999 - 2007

1-UNDP offers $1,4 million.

2- Japanese government $1.5 million.

3- Syrian government: contributes with sp.40 million and provide locations, operational costs, maintenance, and required governmental staff.

What's Villages Sanadiq?

It is a self-reliant local financial institutions, concerned in funding micro investments through easy ,fast and flexible Islamic lending methods in addition to offering training, technical and social care services.

VF. Establishment Mechanism

V.Fs Financial Resources

Characteristics of the Village Fund Model

(1)Meet loans needs of the local community.

(2)Consider prevailed traditions and norms.

(3)Easy and flexible procedures to be applied through the local community.

(4)Financing based on the concept of Murabaha with net profits shared among members.

(5) Good governance through committees with sound election and voting procedures.

(6) Project management team responsible for creating awareness of microfinance practices, training of committee members.

(7) Financial management of the funds based on standardized by-laws and statutes for each of the village funds resulting in “fair” credit decisions and low transaction costs.

(8) Financially viable operations with repayment rates close

to 95%.

(9)Equal access to both men and women as owners and users.

(10)Central Fund:

Sanadiq apex fund for

liquidity exchange and refinancing.

(11)Support from UNDP in the form of matching grant equal to minimum share capital of village fund.

(12) Support from Ministry of Agriculture and UNDP in the form of in-kind donations.

(13) Offering loans as Al Qard Al Hassan for disabled.

Financial products


Share value SL.1000 (20 US$) , as a shareholder can own maximally 50 share.

Any member can withdraw his share capital after at least 1 year of the date of his participation.

All the inhabitants of the village can buy shares regardless of their age.


Financial products


1. Loans type: according to repayment way:

*Seasonal loansrepaid as a lump sum at the end of the period, Monthly profit margin 1.25 %.

*Loans repaid by quarterly installments each 3 months, Monthly profit margin 1 %.

*Loans repaid bymonthly installments, Monthly profit margin 0.75 %

Loan term:

*It is specified according to the cash flow of the economic activity but it shouldn't exceed a 1year.

*Average loan term : 10 months.

Loan size:

*No more than US$ 1000 in the first loan cycle as it is increase gradually through building the client credit worthiness.

*The maximum loan size is US $ 3000.

*Average loan size : US $ 800

Loan collateral:

Two reputable grantors from the village.

Signing promising vouchers.

Total Value of disbursed loans: US $ 8.560 Million (11200 Loan)

%3 Service

%2 industrial

%10 trade

% 40 livestock

%45 farming

% Loan Purpose

Financial products


Non Financial services


/97/ training courses were conducted and beneficiaries' number (men and women) was 1688 .

literacy courses.

Non Financial services

Nursing courses

Non Financial services

  • Hand crafts

    • Sewing

    • Tailoring

Non Financial services

livestock and

honey bee keeping

Non Financial services

Food industry

Electronic devices maintenance

Electrical equipment repair

Hair dresser and barbers

Non Financial services


For the


women products

through fairs and

economic activities.

Village Funds Challenges

  • Legal frame work ( sanadiq legalization)

  • Link sanadiq with banks (for sufficient fund)

  • Independence self management through a sanadiq board from the local community.

  • Access sustainability levels.

  • Wide spread nationally and regionally.

  • Establish specialized links and unions in production and market income generating activities.

1-President of Syria issued in Feb 2007 the legislative Decree no. 15 which provides for permitting the Credit and Monetary Council to license the establishment of a social banking and financial institutions.

2-These institutions aim to offering small and Micro finance in addition to banking and financial services for certain section of peoples .

3-These institutions may be established by Syrian, Arab or foreign boards .

4- Minimum capital of this institutions is 5 Million US$

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