Microfinance Ends Poverty

Why is it so difficult, if not impossible, for the world’s working-poor to break through poverty?  They’re intelligent and hard-working; trying to realize their dreams for better lives.

Former-President Bill Clinton states, “The missing links are opportunities, investments, and infrastructure.”

Muhammad Yunus, Nobel Peace Prize Laureate and Grameen Bank’s Managing Director agrees — “Given the World Bank’s mission is to alleviate poverty, the Bank should provide increased funds for microfinance and make sure that half of those funds go to families living below $1 a day. If the Bank doesn’t do it, who else will? It’s the right thing to do.”

Both President Clinton and Dr. Yunus advocate microfinance; a proven and cost-effective tool to help the very poor lift themselves out of poverty and improve the lives of their families.

Here’s how the loan works:

1. Empower the working-poor — In many (developing) countries, the self-employed comprise more than 50 percent of the labor force.
2. Credits with affordable interest rates — small amounts of credit (averaging $130 U.S.) with reasonable interest rates allow the working-poor to move from small income-generating activities to small micro-enterprises.
3. End poverty with dignity — In most cases, microcredit programs offer a combination of services and resources to their clients including savings facilities, training, networking, and peer support.
4. Accountability — Repayment rates are often higher than conventional borrowers        (in Benin City, Nigeria, 97 percent of 20,000 loan recipients repaid their loans).

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