What Is Microfinance?
Here’s a post from the archives. I had saved it and never got around to actually publishing it!
Who the hell is Mohammed Yunis and why on earth did he win the Nobel Peace Prize?
Well he pioneered the use of micro-loans to poor entrepreneurs in Bangladesh. Dubbed as the “Banker to the Poor”, he began fighting poverty during a 1974 famine in Bangladesh with a loan of $27 out of his own money to help 42 women buy weaving tools to save them from the clutches of the usurious moneylenders.(Yeah, back in the day, $27 was actually worth something).
So whats so revolutionary about microfinance that he deserves the Nobel Prize?
Apparently people think that it will become a catalyst to eradicating poverty. Even the Economist had an article about some guy who was giving out micro-loans to poor tea plantation workers in Assam, India to buy Solar powered headlamps(made by his own company!) but the economics made sense and it was a win-win for everyone.
So how do you benefit? You can become a lender yourself through and offer micro-loans to other people starting with as little as $50. And thus you can do your part to eradicate poverty. Yeah!
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July 16th, 2007 at 10:18 pm
Never know there is such a great idea of microfinance. In Malaysia, poor people have no choice but to borrow from loan shark at interest rate of 4% per month!