Monday, April 30, 2007

bankin' it new school

Who else gets just a little annoyed when the Red Cross decides to pull out of an area where they are needed? Ever wonder how much of your charitable donations get to the relief effort you support but are not sure how to get financial disclosures? Maybe you're like me and in awe of Muhammad Yunus for getting the Nobel Peace prize for his micro-credit work. There is now a way to get involved directly and loan small amounts of money yourself directly to entrepreneurs in developing countries. Kiva.org is offering a way of loaning money at 0% interest through their own portal to whichever business you choose on their site.

Naturally I'm waxing poetic about how amazing this is and how desirable it is to easily get money to a real person in a developing country rather than throwing cash at a charity and checking the news regularly. It is far more satisfying this way, with a more personal involvement in the lives of the people you are affecting.

Microfinancing is not a new concept. In Germany Friedrich Wilhelm Raiffeisen began a bank that reached 2 million rural farmers by 1901. Before that in feudal economies, often farmers would associate together to rent large equipment from the landowner and then took turns using it on their fields. Desjardins also began this way here in Quebec in 1897 (long before usury laws), when Alfonse Desjardins found an impoverished man to have been loaned 150$ and then sued for 5000$. Shorebank in Chicago was the first fully-incorporated bank to provide microfinancing.

There are naysayers at the moment. Many question whether or not this type of lending is taking away from other types of charity and studies are now being conducted to determine whether or not the poor in these programs are helped more than by more formal charities and government welfares.

My more cynical right-eye tells me that this is a simple way to keep poor people in poverty by expecting them to pay back loans to wealthy people who profit (indirectly) from their subsistence. It wonders at the oversight of this money and the protocols used for debt collection when the time comes. My left-eye sees people, the majority of them women, able to work together on their own development with the participation of other economies. It sees an activation of ideas, of implementation rather than the stoppage of welfare and food distribution.

Will any of the studies currently happening gauge the emotional effect this type of program has on the people who receive the help they need? Will it measure how empowered or not, how encouraged or not these people are? How will their spiritual status be measured in the study of a project's success?

There are tiny, simple everyday ways we can choose to help each other or not and this is one more. This is no time to fear big ideas, indeed it is only through innovation of all kinds that we will survive.

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