Sweet Success

     This document has been made available in electronic format 
          by the International Co-operative Alliance ICA 
                         October 1995

                       Sweet Success
             Sri Lankan woman opens candy store

                 Special Report from WOCCU

When Alice Pallewela of Sri Lanka needed money to support her
family, she turned to what she knew~candy and her credit union.
This unlikely combination changed her life and her village~s
perception of its credit union.

A sticky situation
After Pallewela married, her husband, a government employee,
transferred to Yodagama, which was once an ancient village during
the time when kings ruled Sri Lanka. Today, this tiny hamlet, in
the Ratnapura District, attracts Sri Lankans from the south, who
have settled in Yodagama under the government's agricultural
colony scheme.

"Not everyone can be a farmer. Some have to be artisans and
microentrepreneurs. I knew I needed to start my own business to
supplement my husband's small salary," explained Pallewela.

After she decided to go into business for herself, Pallewela
needed to choose what type of business. She said that choice was
easy. It had to be candy. "I've always loved sweets. I especially
enjoy the traditional preparations done during the festival

It proved to be the right niche; the closest candy seller was 50
miles away. 

Recipe for a business
After six months of data collection, Pallewela said she decided
to sell only a few varieties of candy, those that could be
produced using the raw materials available locally.

She now needed to purchase some equipment. Pallewela's credit
union granted her request for a loan of US$100. "The credit union
was there for me from the beginning, offering me both technical
advice and the credit necessary to build my candy business."

Sri Lanka's credit union movement
Credit unions first appeared in Sri Lanka in 1906. Since that
time, the number has grown to almost 7,000, which serve close to
700,000 people, accounting for a six percent market penetration
rate. Working with SANASA (the Sri Lanka Credit Union
Federation), the World Council of Credit Unions over the last 10
years has used U.S. Agency for International Development funds to
strengthen that country's credit unions so they can provide
needed services to members like Pallewela. The efforts are paying
off as members saved about US$31 million and received US$23.5
million in loans by year-end 1994.

Taste of success
Pallewela's business now draws enough profit for her to save
regularly, allowing her credit union to lend to other
entrepreneurs. In fact, since first helping Pallewela, the credit
union's membership has grown; nothing is more powerful than
word-of-mouth endorsements.

As for Pallewela's business, she now employs six young women, all
of whom have become partners, and her product is recognized as
one of good quality in the market. "I own a business~something
many only dream of doing. But I no longer have to dream thanks to
my credit union."