microfinance

Microfinance - a form of financial services for entrepreneurs and small businesses lacking access to banking and related services

Microloan - a small loan given to individuals who might not have access to typical banking services, usually to start or expand small, self-sufficient businesses

One of the best-known lenders is Kiva.org

• As of November 26, 2013, Kiva has distributed $498,939,550 in loans from 1,015,823 lenders to 1,177,248 borrowers
• A total of 637,003 loans have been funded through Kiva
• The average loan size is $410.89
• The average Kiva user has made 10.06 loans
• Kiva's current repayment rate for all its partners is 99.01% !

microentrepreneurs who are trying to start (or kickstart!) a small business

villagers needing to fund a clinic, hospital, or other health care facility (malaria treatment, drugs, hypos, refrigerators, sanitation)

teachers trying to run a school (buying anything from books and pencils to desks and chairs)

students wanting to further their education (college tuition)

high interest rates

sometimes as high as 23%

The cost of providing banking services to those living in

poverty is high.  Being the company that provides tiny

loans can be expensive.

What’s harder and more time-consuming to process:

one $500,000 loan, or five hundred $1000 loans?   

banking services are often unavailable to poor people -

microloans fill a gap

it’s not just loans, but also insurance, legal representation,

and help with financial planning that become available

these are all important to people who are trying to break

the cycle of poverty

but poverty is a huge problem with no easy solutions

there are many challenges faced by developing nations

some of these can be alleviated through microloans

• substandard education ($ can help purchase supplies, buy books, pay teachers)
• poor health care ($ can help buy supplies, construct new/better buildings, deal with malaria)

speaking of malaria...

• It’s a mosquito-borne infectious disease
• humans and animals can be infected through the bite of a female mosquito
• no vaccine exists   :(
• it kills around 665,000 people

a year, many of them children

in sub-Saharan Africa

• mosquito nets can be effective
• (Thank you, Bill Gates)

philanthropy is the generous donation of money to good causes, and Bill and Melinda Gates are the second greatest philanthropists in history ($28 billion, ⅓ of their wealth)