Habitat Moves Into UKRAINE With Housing Microfinance Program
Habitat for Humanity and Ukraine’s HOPE International are joining forces to provide affordable home-improvement loans to low-income Ukrainian families. The partnership draws on the strengths of both organizations, Habitat as an internationally recognized leader in addressing substandard housing and HOPE as a microfinance network with well-established clients.
In its first year, the pilot program—in Transcarpathia in the west of the country—is expected to reach 200 families in need of better housing. Poor housing is prevalent in this region, where Soviet-era infrastructure is beginning to crumble and the economy remains weak.
Families who have a strong repayment history with HOPE and meet eligibility criteria will have access to loans ranging from $500 to $2,500 to fund home improvements such as roof repairs, plumbing projects and electrical work. Following the Habitat model, loan recipients will be expected to invest sweat equity in remodeling their homes. The below-market-rate loans require monthly payments, with installments deposited in a revolving fund to generate additional home-improvement loans for more families.
Habitat has been active in home-improvement lending to families in Eastern Europe and is eager to expand its work to Ukraine. “Habitat offers low-income families a hand up, not a handout,” says Lucija Popovska, program director for Habitat’s Europe/Central Asia operations. “We’re excited to work with HOPE on a project that will help many more families into simple, decent shelter in Ukraine.”
HOPE has been issuing microloans in western Ukraine for eight years, but in the past has restricted its loans to income-generating activities, such as small businesses. Over the years, however, HOPE has observed that the high cost of home improvements has prohibited many families from achieving their housing goals. “This new loan product will be very popular with our clients,” says Andre Barkov, HOPE’s Ukraine country director. “These home loans will be offered at low interest rates to the best clients, rewarding their loyalty and their commitment to loan repayment.”