a billion bootstraps
TRANSCRIPT
• Sweat equity
• Almost impossible without a loan
• The majority world has little access to capital or collateral
• There is little security for any capital that does exist
• Loan sharks are the only option
http://www.youtube.com/watch?v=FZblPaIXiTs
Levels of Poverty
• Living on less than $1/day: 1.2 billion
• Living on $1-2/day: 1.6 billion
Women & Children
• The majority of those in poverty
• Have a more difficult time making money
• Exploitation of Children
• More than 100 million children are at risk of being stunted physically & mentally due to
malnutrition
• Most people are donors
• The hugeness of the nonprofit sector – 2 million registered in the U.S. alone!
• The $900 billion black hole
• Cycle of aid-driven poverty
• Intelligent giving
• Alternatives to harmful aid
• Giving cautiously
• Have a bottom line
• Measure success
• Support what works
• Have expectations
• Ask questions
• Define success
• Ask more questions
• Figure out your objectives
• Figure out indicators of results
• Investigate
• Proactive rather than reactive
• What about foreign aid?
• Appropriate technology over advanced techniques
• Take the “searcher” approach
• “Development pornography”
Microcredit
• Cash only
• Microenterprise
• Both physical & abstract benefits
Barefoot Banking
• The Mao Zedong model
• Much more relaxed than the typical image of a bank
• Called community or village banks
How It Works
• Central bank with branches
• Travelling bankers
• Weekly meeting & finance lessons
• Establishing trust is establishing dignity
Best Community Banks
• Small loans
• Small groups
• Short terms
• Frequent payments
• Potential future, larger loans
Interest
• Interest is critical to the sustainability of the microcredit organization
• Microcredit organizations are far safer, more honest, and cheaper than commonplace loan
sharks
• Decapitalizing the system will lead to failure
Savings
• Savings may be the only safety net for the poor
• Not always capital
• Revolutionary idea of getting paid to save
Microcredit Plus
• Lagniappe
• More than just the experts – it’s the people
• Hunger & Nutrition
• Business Training
• Medical Care
• Preserving the Environment
• Women
How to Put Your Money to Work
• Put it in an underdeveloped country
• Use for short terms – faster turnover rates, more people have access to the same
money
• Give with caution
The Downside
• Clients don’t always pay back
• Local corrupt governments, organizations & loan officers
• The poorest of the poor are not eligible for loans
• Donors must know their own personal and financial resources
Donor Options
• Give to grassroots organizations
• The MicroCredit Solutions Fund
• Give to an International Organization
• Give your Skills & Money
• Give Your Time Along with Everything Else
• Start a Microcredit Program
What’s in it for you?
• Investment return
• Power to change countless lives with a small amount of money
• Joy!
Where do I start?• MicroCredit Solutions Fund (www.genevalglobal.com)
• Microcredit Clearinghouse (www.microcreditclearinghouse.org)• ACCION International (www.accion.org)
• ASA (www.asabd.org)• CARE (www.care.org)
• Esperanza (www.esperanza.org)• FINCA International (www.villagebanking.org)
• Fonkoze (www.fonkoze.org)• Freedom from Hunger (www.freefromhunger.org)
• Grammen Bank (www.grameen-info.org)• HOPE International (www.hopeinternational.org)
• MEDA (www.meda.org)• Opportunity International (www.opportunity.org)
• SKS Microfinance (www.sksindia.com)• Unitus (www.unitus.com)
• Women’s World Banking (www.swwb.org)• World Concern (www.worldconcern.org)
• World Relief (www.wr.org)• World Vision (www.worldvision.org)
Meet Some Borrowers
CesielynFarming
Philippines
Maria JuanaAgriculture
Ecuador
Shanaz’s GroupAgriculture/Animal Sales
Pakistan