Micro-Lending

1
Micro-Lending
2
What is micro-lending?

• Microcredit is the extension of very small loans
  (microloans) to those in poverty designed to spur
  entrepreneurship. These individuals lack
  collateral, steady employment and a verifiable
  credit history and therefore cannot meet even the
  most minimal qualifications to gain access to
  traditional credit.

3
Why microcredit?

• Microcredit emphasizes building capacity of a
  micro-entrepreneur, employment generation, trust
  building, and help to the micro-entrepreneur on
  initiation and during difficult times.
• Microcredit is a tool for socioeconomic
  development.

4
Using the Web to micro-lend

• Multiple Internet-based organizations have
  developed platforms that facilitate a modified
  form of peer-to-peer lending where a loan is not
  made in the form of a single, direct loan, but as
  the aggregation of a number of smaller loans.
  There are several ways by which the general
  public can participate in alleviating poverty
  using Web platforms.

5
Small Loans. Big Impact.

• Can a 50 loan really make a significant impact
  on a persons life?
• Absolutely!
• While 50 may seem small, it is important to
  remember that the working poor typically live on
  less than 2 a day. To them, a 50 loan is
  roughly equivalent to an entire months income.
  With that extra income, they can buy supplies or
  equipment that can help them start new businesses
  or earn more income from their existing
  businesses.

6
Kiva's mission is to connect people, through
lending, for the sake of alleviating poverty.

• Kiva empowers individuals to lend to an
  entrepreneur across the globe. By combining
  microfinance with the Internet, Kiva is creating
  a global community of people connected through
  lending.
• As of November 2009, Kiva has facilitated over
  100 million in loans.

7
"Kiva" is a Swahili word which means "unity" or
"agreement". Kiva was co-founded by Matt and
Jessica Flannery, when they were 28 and 27
respectively. PayPal provides Kiva with free
payment processing. Kiva's is the first account
at PayPal with a free payment processing
agreement. Anyone with an email address can
create a Kiva Account. Anyone who can make
payments using a credit card or PayPal account
can be a Kiva Lender.
You can lend as part of any number of teams on
the Kiva website, such as the CSU team or the
Stuff You Should Know Podcast team
8
How Kiva Works
9

• Kiva was born of the following beliefs
• People are by nature generous, and will help
  others if given the opportunity to do so in a
  transparent, accountable way.
• The poor are highly motivated and can be very
  successful when given an opportunity.
• By connecting people Kiva hopes to create
  relationships beyond financial transactions, and
  build a global community expressing support and
  encouragement of one another.

10
How Works

• It all starts with our Field Partners, which are
  microfinance institutions operating around the
  world.
• 2) The Field Partner uploads the entrepreneurs
  profile to Kivas website.
• 3) Lenders like you browse the entrepreneurs
  profiles and choose someone to lend to, using
  PayPal or their credit cards (as little as 25!).
• 4) Kiva provides the funds to our Field Partners.
• 5) Over time, the entrepreneur repays her loan.
• 6) When lenders get their money back, they can
  re-lend to another entrepreneur, donate their
  funds to Kiva (to cover operational expenses), or
  withdraw their funds to their PayPal accounts.

11
Microloan is committed to helping the poorest of
the poor to help themselves in order to change
their lives for the better. 

• Microloans key objectives are the relief of
  poverty, the advancement of education and the
  relief of sickness in the developing world
  through the provision of microloans and grants. 
  The services are charitable and not-for-profit.
• Microloan provides small loans to groups of women
  across sub-Saharan Africa.

12
(No Transcript)
13
Our mission is to use micro-lending to promote
economic opportunity and political stability in
the Middle East.

• LendforPeace.org is a not-for-profit Internet
  platform that allows individuals like you to make
  small loans to specific micro-entrepreneurs in
  the Palestinian Territories.
• Using the site, you can make a loan directly to a
  vetted micro-entrepreneur in the West Bank. 
  LendforPeace work with US government-approved
  microfinance institutions on the ground to
  deliver your capital along with training and
  guidance to low-income individuals who are
  interested in starting or expanding their own
  small businesses.
• Founded by two Jews and two Palestinians,
  LendforPeace.org was created to enable people of
  all faiths and backgrounds to make a tangible
  difference in the Israeli-Palestinian conflict.

14
Pro Mujer provides poor women in Latin America
with the means to build livelihoods for
themselves and futures for their families through
microfinance, business training, and healthcare
support.

• Pro Mujer fights poverty by establishing
  sustainable microfinance organizations that
  provide an integrated package of financial and
  human development services that women require to
  build and improve their small businesses.
• With a steady income, good health, and improved
  self-esteem, women are empowered to become agents
  of change and lift themselves and their families
  out of poverty.
• Pro Mujer currently operates in Argentina,
  Bolivia, Mexico, Nicaragua and Peru, and has
  plans to expand into other countries in Latin
  America.
• US159 million in loans were disbursed in 2009.
• Currently serves 202,000 clients and
  approximately one million children and  extended
  family members.

15
(No Transcript)
16
MicroPlaces mission is to help alleviate global
poverty by enabling everyday people to make
investments in the worlds working poor.

• MicroPlace is a social business owned by eBay.
  MicroPlace wants to alleviate global poverty by
  offering investments that enable loans to
  hardworking poor people.
• What's a social business? It's a financially
  sustainable company that has a social mission.
• A loan of a 20 can allow a poor woman to start a
  business and work her way out of poverty. In many
  countries, organizations that function like banks
  make loans to the poor. These organizations need
  funds to lend to the poor. Your investment helps
  fund these organizations. You are paid a return
  for the funds you invest. You can fight poverty
  and get your money back with interest!

This website gives you back your money back with
interest, unlike the other sites which are
interest-free, which do you think is more helpful
to those in need?
17
Created by Bonnie Sizer Resident
Assistant Colorado State University
See slide notes for display tips and do not print
this page!