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Micro-Lending

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Micro-Lending What is micro-lending? Microcredit is the extension of very small loans (microloans) to those in poverty designed to spur entrepreneurship. – PowerPoint PPT presentation

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Title: 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
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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
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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 bonnie.sizer_at_gmail.com Res
ident Assistant Colorado State University
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