TELLING YOU MORE
A good number of our readers by now have turned in their reactions to an article Faith in Families posted last 16 April 2010 about the Grameen Bank – a microfinance organisation and community de-velopment bank that makes small loans to the impoverished without requiring collateral. Many be-lieve it can work in New Zealand. But there are also a few who think it can’t.
We encourage the submission of opinions from all quarters because listening brings ideas back into the marketplace. It is ideas that spark innovation that influence service development. It pinpoints ways to get access to and attention from decision makers.
Different points-of-view jumpstart meaningful conversations. We believe that, by taking in your opinions and setting them free, by sharing them with everyone – to people in our and other organisations, this website’s audience base and to the wider community, this encourages them to talk about their own ideas and what they hear from the resulting conversations that arise. People will remem-ber and talk about fresh points-of-views that get other people to say, “Well that’s really interesting. Tell me more.” So here goes.
POOREST OF THE POOR
Social lending covers a broad swath – loans to nonprofits, affordable housing, anti-loan shark programmes, and small business development for minorities and women.
Today, we’re taking another leap of faith by sha-ring two more credible examples on the subject of why social lending works and why some of its proponents harbor the idea that banking and cre-dit does work for the poorest of the poor. This article focuses on ways social lending can be relevant by way of sharing even more examples of real life sto-ries.
In the United States, the nonprofit Center for Community Self-Help provides financing, technical support, consumer financial services, and advocacy for those left out of the economic mainstream. Since its founding in 1980, Self-Help has reached out to female, rural and minority communities across America.
What does it do?
- It helps borrowers build wealth through ownership of a home or busi-ness.
- It strengthens underserved communities by financing nonprofits, child-care centers, community health facilities, public charter schools, small businesses, first-time homebuyers and residential and commercial real estate projects. It also manages retail credit union branches providing responsible and fairly-priced accounts and services.
- It operates a secondary market program that enables private lenders to make more loans in low-wealth communities.
Over time Self-Help has learned, and demonstrated, that low-income borrowers pose no greater credit risk than others. Its borrowers have proven their deter-mination to repay their loans, build their businesses, improve their commun-ities, and build wealth through home equity.
As a 30-year old nonprofit “bank”, Self-Help has invested over US$ 5-billion in low-income and minority communities by making market rate loans. Considered one of the most effective nonprofits in the USA, Self-Help has also made 788 working capital, equipment and building loans to nonprofits and human services providers, totalling some US$ 206-million, creating or maintaining 8,832 jobs, and 47,470 child care, school and housing spaces.
We can probably tell you more about Self-Help’s time-tested proven model, but its success and meaningful outcomes would better be told if you read about it from the very people they serve.