The Creating Sanitation Markets or Alternative Pro-poor Sanitation Solutions (APSS) in Peru Initiative has reached a new milestone, allocating over US$150,000 in credit towards improved sanitation for people otherwise ineligible for commercial loans.
A recent Water and Sanitation Program (WSP) market research poll discovered many potential sanitation customers in Peru are ineligible for a sanitation credit since their income is above the limit to receive support from governmental programs, but below the expected salary to be eligible for a commercial loan (US$50 to US$170 per month). Recognizing the growing demand for sanitation products among these customers, small local businesses affiliated with the Initiative, such as hardware stores, have begun accepting payment in installments. This allows people who do not qualify for a loan, or who feel more confident dealing with their local storekeeper, to have a viable opportunity to invest in a new bathroom for their homes.
The local business owners assume the risk for the loan, which is provided to customers who have a working relationship with the business owner. Typically the loans do not bear interest or additional charges.
APSS is a public-private alliance headed by the Peruvian Government through the Vice Ministry of Construction and Sanitation of Peru (VMCS), Lima’s public water utility (SEDAPAL), the National Direction of Environmental Health (DIGESA) of the Ministry of Health, the World Bank, the Swiss Agency for Development and Cooperation (SDC), the United States Agency for International Development (USAID), the Americas Fund (FONDAM), the Ensemble Foundation and the Water and Sanitation Program (WSP) administrated by the World Bank (WSP). APSS is implementing in five pilot zones of Peru. These localities are representative of the diverse cultural, geographical and social conditions of the country: the urban marginal areas, rural areas, small towns; the coast, the highlands and the jungle regions.
Read a 2008 background paper on the APSS “Building inclusive sanitation markets for the poor” by Malva Rosa Baskovich.
Visit the Creating Sanitation Markets web site for more information.
Source: WSP Access, Dec 2009