Gromada Credit Union was the first agricultural credit cooperative Oikocredit financed in Ukraine. In 1996, four women started the cooperative with the aim of providing small consumer and trade loans to market traders. Unable to approach traditional banks, farmers also began to turn to the women for support with their agricultural projects. Today, the cooperative Gromada Credit Union serves more than 5000 members, in the rural sea-side regions of Kherson and Mykolaiv. Gromada continues to support its members both financially and socially, through savings, loans, training, advisory services and youth programmes.

Emergency loan gets Alexander through the winter

Alexander Dodonov has now been farming for a decade, and was anxious at the thought of taking out a loan to support his farm. It was only after he found he could the make repayments that he grew confident and saw the benefits of being a cooperative member and microfinance borrower. Approaching traditional banks was never an option for Alexander, who says interest rates are higher, and conditions of the loans less flexible than those of Gromada Credit Union. Now, Alexander is on his fifth loan cycle, and has used Gromada loans to pave the way to farming success.

Alexander and his family own around 25 acres of land, which they received from the government after the ‘collective farming’ regime, part of the Soviet Union’s system was disbanded. Today, most of their land is leased to a larger farm. Alexander relies on three greenhouses to grow tomatoes, cucumbers and cauliflower, and an irrigation system. He aims to harvest his vegetables twice a year, and relies on the greenhouses – heated by a wood-run stove – to deliver the first harvest in spring. An unusually cold spring stuck two years ago, meaning Alexander drew on more wood supplies than usual. Realizing he was short on fuel for the months ahead, Alexander applied for a short-term emergency loan with Gromada. The loan was approved and disbursed within two days; delivered on the day he ran out of fuel.

With the combination of his hard work, knowledge and loans from Gromada, Alexander has built up his farm and become a source of advice for many of his fellow members. “People come to me for advice because I have a good feel for what the plants need. I give them tips on what seeds and fertilizers to buy, and send them to the shop,” Alexander says. “

But in future, I want to own a store for them to get what they need. When I can manage to save half the money to open a store, I will borrow the remaining half from Gromada.”

Oikocredit in Ukraine

During the 1990s, Oikocredit realized the need to support Ukraine’s microentrepreneurs by financing credit cooperatives, microfinance institutions and agricultural farms. Today, with an Oikocredit subsidiary office in Lviv that can operate more effectively in the country, the strategy for Oikocredit in Ukraine remains the same; support microentrepreneurs via agricultural partners.