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The Portland Trust is committed to promoting peace and stability between Palestinians and Israelis through economic development.

MicroFinance in the Palestinian Territories

The Portland Trust aims to contribute to alleviating poverty in the West Bank and Gaza by developing the microfinance sector. Microfinance has proved to be one of the most effective instruments in helping to stimulate entrepreneurship, create jobs and generate income for the poor.

In the Palestinian Territories, The Portland Trust, in partnership with PlaNet Finance, is working with the Palestinian Network for Small and Micro Finance (PNSMF) to support the sector and to provide technical assistance. The strengthening of the PNSMF is a priority for the Palestinian MicroFinance Insitutions (MFIs) in order to integrate the microfinance sector as an effective component for poverty alleviation and to channel and coordinate the assistance to Palestinian MFIs and to poor Palestinians. We are helping build the capacities of PNSMF and its members to give access to Palestinian poor people to the services needed to develop their microenterprises, services that include financial services as well as vocational training and business development schemes.

In 2007, we secured a grant from the EU of €750,000 to develop a three year action plan to build capacity in the microfinance sector. Together with PlaNet Finance we are providing an additional €550,000 in support of the Palestinian Network for Small and Microfinance Institutions.

We are also researching other initiatives in the microfinance sector including potential projects with individual Palestinian MFIs such as PARC and Al Rafah Bank.

Our main objectives in encouraging MicroFinance in the Palestinian Territories are:

• To improve the living conditions of poor Palestinians: In the Palestinian Territories, 53% of the population lives today under the poverty line (a large part of the middle class having fallen into poverty in the past 5 years). Our project with PlaNet Finance will allow 70000 poor Palestinians – the micro-entrepreneurs and their families - to increase their revenues and thus secure better health, education or housing.
• To instil the sense of entrepreneurial drive, ambition and hope for the future in Palestinian Territories: Microfinance is recognized as a key tool in poverty alleviation as it gives to poor people the means to rely on their own capacities and develop their own business, improve employment prospects and create sounder economic environments. This project will foster an active development in the Palestinian Territories and contribute to a shift towards an entrepreneurship mindset.
• To increase employment opportunities: The project will enable Palestinian micro-entrepreneurs to develop and upgrade their micro-enterprises and thus to stabilize and create new employment opportunities. In the Palestinian Territories, the unemployment rate is estimated between 26 to 50% of the population. The project will increase employment opportunities, especially for women (60% of the total number of active clients).

For more information on PlaNet Finance, please visit the PlaNet Finance web site.

Winners of the first ever Palestine Best Micro Entrepreneur Award announced (October 2008)