There’s been a lot of press over the last two years about the state of the world economy, and the corporate concept of ‘too big to fail’. I’d like to turn that statement on it’s head and propose that in today’s world, we need to focus on the fact that our critical thinking should address the concept of ‘too small to fail’. In other words, for the most stable and peaceful global economy in the future, we need to provide individuals with the tools to lift themselves out of poverty and to succeed. One of those tools is microfinance.

If you are familiar with some of the microfinance organizations like Kiva, their mission is focused on providing micro loans to adults in developing countries. There is a new movement, which takes it a step further and focuses on the next generation and their college level education – Vittana.

Did you know that in most countries student loans do not exist? Vittana provides the avenue for people like you and me to participate in the student loan process and fill that void. Vittana works in developing countries – Vietnam, Mongolia, Nicaragua, Paraguay and Peru – with local microfinance organizations who develop the selection criteria based on their knowledge of local culture and the job market.

Loans are given to students in their final year of college or those in short term vocational programs to assure the highest rate of success. It’s estimated that by finishing their education, they will improve their income earning potential by 200-300%.

Vittana’s business model is one of student loans, not scholarships. Once the student graduates, they begin a repayment schedule which is outlined on the website along with the profile of the student. As with all microfinance, this is a hand up, not a hand out.

The dignity that comes with the ability to make a living, support yourself and your family is invaluable and a currency that we all need to trade in for our successful future. I hope you will check out Vittana and make a student loan today.  Feel free to join the HarmonyWishes community and be a part of our lending team or create one of your own!

Good news!  Our die-hard leader here at HarmonyWishes, Meg, recently received word that she’s been accepted as a volunteer Team Leader with Kiva. Congratulations, Meg!  If you haven’t heard about the good work Kiva does to make a difference in the lives of fledgling entrepreneurs around the globe, then take a look here.

Kiva Lending Chart, by country

Or you can even join our lending team at Kiva here. Come help us make a difference in supporting equitable opportunities without borders.  A portion of our proceeds at HarmonyWishes, and your dollars as members (!),  goes to support the efforts of entrepreneurs around the world.  So, feel proud.

Meg’s new post with Kiva got me thinking about some of these “newer” systems of investing and giving.  Micro-lending has become a hot topic of late, especially with organizations like Kiva modeling new ways to help people who are already working to help themselves.  The idea behind micro-lending is to provide financial services to those with little access.  Traditionally, banks don’t often provide those services in poverty-stricken areas; thus, the poor often turn to local money lenders, whose interest rates can be astounding.  In many of the small villages I’ve visited around Oaxaca there are no banks to speak of at all.  People must travel hours away to the nearest city to access bank services.  However, small credit unions and lending companies (not regulated by the State) set up shop, setting very high interest rates on the money loaned.  It can be the only, and often oppressive, option many people have.

In answer to this very real need, organizations like Kiva, Pro Mujer and Grameen Bank are utilizing micro-lending systems to help bring opportunity and financial services to the doorsteps of the poor.

Muhammad Yunus, founder of Grameen Bank

They’ve got some unique ideas and practices.  I’ve heard arguments for and against lending of this kind.  I’m curious to know what you think.  We’ve all been on the receiving or giving ends of loans before, no?  How different would it be for you to lend that same money to a stranger?  Is it easier to lend the money, or just give it away? I’m curious.

I think it’s an exciting time to consider—or reconsider—the ways in which organizations and individuals look for funding assistance.  Micro-lending organizations are living examples that individuals can make a powerful difference with the small resources they have to lend.  I’m trying to put that lesson to the test with some of my work here in Oaxaca.

Oaxaca State

Over the last several months I have been working with a partner here in Oaxaca to build a youth radio workshop for teens in the indigenous and poverty-stricken villages of the state.  The kids we’re teaching come from some of the most marginalized populations in the country.  Access to the basic services (education, drinking water, electricity) is limited, let alone access to extracurricular educational activities like radio.  But my partner Kiado and I think it’s important that youth from these villages have a space where their voices, opinions and ideas are valued.

Of course one of the great challenges to our work has been funding. Traditionally projects like ours would start by looking for funding from foundations, government departments or big donors.  That source of funding can often take time, requires a formal entity (i.e. 501(c)(3) status, which costs money to set up) and is highly competitive.  So, we’ve decided to use a little something called crowdfunding to get our project off the ground.  Crowdfunding, or crowdsourcing, operates off the idea that you can tap into a font of money in small amounts, from lots and lots of sources.  Rather than one foundation or donor shouldering the cost of the project, it is shared by many people in an amount that’s reasonable for each of them.

Crowdfunding is not an unusual idea here in Oaxaca, where people have little access to credit and loans.  There’s a common practice called “tanda” here that’s very similar to the crowdfunding system.  Here’s how it works: I need a loan of 10,000 pesos (around $770) so I can go to my sister’s wedding next month.  I rally 10 friends.  We each draw a number 1-10 from a hat; I automatically get number 1 because I organized the tanda and my need is most immediate. Every two weeks each member of the tanda sets aside 1,000 pesos and that’s given to the first person on the list (10,000 pesos total).  Two weeks later the next person on the list gets his/her 10,000, and so on.  It’s a loan system amongst friends; there’s no interest, and people hardly ever default because it’s their own friends they would let down.

What I appreciate about crowdfunding, and even micro-lending is that in addition to the financial resources you gain, you also harness a great deal of enthusiasm and momentum for your work from those supporting you.  Politicians do it in their campaigns, so why not little efforts like ours!  It’s been a really energizing experiment.  I’ll keep you posted on how it goes.

I encourage you to think of the ways in which the support of the myriad people in your network could help you solve a problem. After all, crowdsourcing can be used for more than just funding issues. People all over the globe are opening up to the ideas and knowledge that the many can offer in small efforts. Just think of how things like Wikipedia have grown over the last few years. We here at HarmonyWishes could use your help, too. If you’re enjoying our blog and the services on our site, please help us spread the word. Or better yet, send the message on by using one of our e-cards! Help us grow our community of users and participants. Together we can make a huge impact.

Saludos,

Megan