Peter Carbonara just posted a great article to the Fast Company Blog how Muhammad Yunnus’ Microcredit Is Shrinking Poverty. Microcredit is giving tiny loans to poor entrepreneurs who otherwise would not qualify for loans. There is no collateral required and the loan is payed back in very small amounts. This has been very successful in helping to lift poverty in developing countries.
“Don’t just offer the poor charity, Yunus argues: give them access to credit. Don’t create incentives for villagers to head for the misery of the city; unleash engines of growth in the country.”
The Kevin and Debra Rollins Center for eBusiness has a program called eLeaven which focuses on helping impoverished countries rise above poverty. They have presented several times on the effectiveness on Microcredit.
I think microcredit is a wonderful thing. Does anyone know of a way to get involved so that more of this can happen in the world? It seems that most people in the U.S. would be able to afford to contribute to microlending, if there was an avenue to connect the lenders with the borrowers.