Monday, November 1, 2010


Simply, microfinance is the idea of banking to the poor. As many know, especially in developing nations, the poor are not even given loans by banks let alone let into banks.  Because of this, they are never able to grow and have capital.  The main problem with this is that if people are never given the chance to grow they will always stay the same, and in some cases they will continue to live in poverty.  A seemingly simple solution to this problem is to start giving trust and support to the poor.  In reality, throwing supplies and money at a situation will only get people so far, empowerment is the key.  Mohammed Yunus the creator of microfinance and the founder of the Grameen Bank found how a small loan made a disproportionate difference to a poor person.  With this new realization, Yunus got money from the Bangladesh government to loan to women.  He found this was incredibly successful and now, over 6.55 billion US dollars have been distributed with a 98% loan recovery rate.  This bank specifically loans to 97% women in order to empower them to build a better life despite the male dominated world they live in.

As I was recently watching a TED video by Jessica Jackley , co-founder of Kiva, a microfinance organization, it suddenly dawned on me that we shouldn't look down on the poor because they aren't less human than us, we should find a way to empower them because in reality they are hard working entrepreneurs that need something to grow on.  Of course there are some who are beyond this stage of poverty, but for those who have skills to make something of their lives, microlending seems like the perfect solution.  I think the reason I am so drawn to the idea of microlending is because the fact that banks won't lend the poor because of lack of security, trust and societies rules seems petty.  The reality is that these incredibly small loans to us could be the jump start to another's life. 
Jackley also highlights a lesson she learned that I think is important to understand.  She alludes to the fact that everyone has their own customs whether they are religious or social they mean something.  These customs affect not only the way they think but also what they do.  She points out its not about changing peoples' views or customs, but rather about helping them grow in their own way.  Jackley believes in the potential of others and I don't think she is over idealistic.  She knows that its not about all the fancy economic terms and the loads of money being pushed around, its about trusting and believing in each others potential to be great. 

"This belief in each other, knowing that without a doubt and practicing that everyday in what ever you do, that, is what I believe will change the world and make tomorrow better than today."
                                                            - Jessica Jackley

Jessica Jackley's TED talk

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