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I am excited about the concept of micro-loans or micro-credit. It’s moved to the center of my radar recently and so I’ve been reading up about the concept and how it works.

The KeyMuhammad Yunus, a Bangladeshi economist, won the Nobel Peace prize in 2006 for pioneering this new type of banking known as micro-credit, which grants small loans to poor people who have no collateral and who don’t usually qualify for conventional bank loans. His program enables millions of Bangladeshis, almost all women, to buy everything from cows to cell phones in order to start and run their own businesses. Similar micro-credit projects have helped millions around the world lift themselves out of poverty.

I find this grassroots effort exciting because it speaks to the belief that when given a hand, we can all succeed, and especially when in a supportive and encouraging setting. The idea has expanded from its roots in places like Bangladesh to dozens of countries, including the USA. It’s about empowering people to help themselves; very much like the concept of teaching someone to fish so they can feed themselves. You know the one.

One article I read at The Huffington Post written by Premal Shah, the president of Kiva.org, is entitled Americans Can Help Each Other a Lot by Lending a Little.  The statistics are enlightening:

In 2009, the 27.5 million small businesses in the United States represented more than 99 percent of the nation’s workplaces, ranging from the traditional family owned dry cleaner, to the hip new gourmet food truck. According to a new study of businesses with nine or fewer employees commissioned by Kiva.org and Visa, nearly 51 thousand small businesses were lost nationwide between 2006 and 2008.

It makes me believe that small businesses are vital in our road to economic recovery and greater stability in the US.  And the ability to access these smaller micro-loans are particularly vital in countries where seemingly small amounts can make an even bigger difference between making it or not.

KivaToday is International Women’s Day and there’s a unique offer on the Kiva website to try the idea of providing a micro-loan to a woman who needs the help in creating a new business or venture. I am a fan of Kiva. I hope you’ll give it a read and maybe decide to make an investment too.

— Debbie Hindman

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