Saving the World through Microfinance

One of the elements of my job is microfinance- small loans that help poor people who wish to start or expand their small businesses but, are not able to get banks to lend to them. Microfinance is an innovative way to reduce poverty in developing countries. Last year, Dr. Muhammad Yunus, a Bangladeshi banker and economist, won the Nobel Peace Prize, along with Grameen Bank, for “their efforts to create economic and social development from below.” Grameen Bank provides credit to the poorest of the poor in rural Bangladesh, without any collateral. Credit is a cost effective weapon to fight poverty and it serves as a catalyst in the overall development of socio-economic conditions of the poor who have been kept outside the banking orbit on the ground that they are poor and hence not bankable.

There are many ways that you too can be a microfinance “do-gooder” and help someone in an impoverished country develop as an entrepreneur. One site, whose motto is “Loans that change lives,” is Kiva.org. Kiva lets you connect with and loan money to unique small businesses in the developing world. By choosing a business on Kiva.org, you can “sponsor a business” and help the world’s working poor make great strides towards economic independence. Throughout the course of the loan (usually 6-12 months), you can receive email journal updates from the business you’ve sponsored. As loans are repaid, you get your loan money back. You can loan as little as $25 to help entrepreneurs in places like Uganda, Tanzania, and Mexico.

Unitus.com is another nonprofit organization whose mission is to fight global poverty by increasing access to microfinance. To get involved with Unitus, you can host an event to educate your family and friends about poverty, microfinance, and Unitus. Or you can make a financial contribution to Unitus and help the organization continue to fight poverty through microfinance.