Village Enterprise Fund

Village Enterprise Fund's mission is to break the cycle of poverty in East Africa through training, seed capital and mentoring for income-generating small businesses. They have staff in Kenya, Tanzania, and Uganda, employing a grassroots model of economic development.

The organization combines education, finance and mentoring to create sustainable income-generating businesses. Their business training empowers groups of five or more to select, create and operate small businesses. The training covers:

• Assessing the market for the product or service
• Marketing skills
• Re-investing profits for growth
• Basic record keeping
• Group dynamics and decision making
• Confidence building

Seed capital grants of $100 or $150 go to trained groups with approved grant applications. The grants are provided in two installments. The first installment is for operation start up; the second upon approval based on a progress report showing profits and revenue. Rural start-up businesses include:

• Agriculture (maize, cassava, tomatoes, peanuts)
• Animal husbandry (goats, chickens, pigs)
• Skilled service and construction (tailoring, carpentry, welding, bicycle repair)
• Retail (vegetable kiosks, restaurants and cafes, household goods)

Village Enterprise Fund  provides personalized advice and encouragement for at least one year, as part of their on-going mentoring. This coaching helps new entrepreneurs gain confidence, overcome the typical challenges of a new venture, understand local market opportunities, become self-sufficient and grow their businesses.

Empowerment grants of $300 go to our most successful entrepreneurs. These incremental investments take an existing business to a new level. 

In the past year the organization has transformed 70,925 lives. For more information on how you can help, please visit Village Enterprise Fund's website.

Southern Bancorp

Southern Bancorp (Southern), a development bank holding company, was formed in 1986 as the brainchild of then Governor Bill Clinton and Winthrop Rockefeller Foundation to end decades of economic decline in rural Arkansas. They are committed to helping transform rural economics by creating new trends of investment in people, jobs, business, and property.

The organization combines the vision, passion, and creativity of nonprofit organizations with the fiscal discipline, financial capacity, and permanence of the FDIC- insured banks. Southern's family of companies include three commercial banks and three 501(c)3 nonprofit organizations.

"Because of the unique public-private partnership, Southern is able to access both the grassroots individuals most affected by regional change as well as the community leadership base of professional, civic, and governmental institutions that traditional nonprofit organizations are unable to reach. Southern's goal is to organize all of the above in a manner that promotes action and stimulates fundamental community change.

Southern believes that successful regional change must be initiated by communities and that such change will be driven by anchor communities in the region. Anchor communities maintain critical mass of business, industry, and population and have the potential to attract and promote economic activity and growth.  Anchor communities are an economic and cultural force within a 50-mile radius that support and transform smaller communities in their sphere of influence. Regional change is possible only when several anchor communities can combine to drive revitalization in the larger region."

Their methods include:

• Asset Building: Southern Good Faith Fund- established in 1988 as a microloan fund, modeled after Grameen Bank. Over time the mission has evolved to better meet the needs of Delta residents. This now includes asset building, business development center, career pathways, and public policy programming.
• Community Banking
• Community Planning
• Development Lending
• Partnerships
• Property Development

To date Southern Bancorp has:

• Funded more than $1.7 billion in development loans
• Created or saved 7,000 jobs
• Assisted 930 individuals in obtaining a certificate or degree with 88% landing a job upon graduation.
• Developed more than 175 high quality housing units throughout the Delta.

For more information on Southern Bancorp please visit their website. 

Unitus

Unitus, founded in 2000, is an international nonprofit organization working to reduce global poverty by increasing access to life-changing microfinance services.

In 2001, Unitus' founders traveled to Bangladesh to learn about Grameen Bank and meet its founder, Muhammad Yunus. The trip left the founders of Unitus convinced that microcredit was the key to large-scale poverty alleviation and they began their increased efforts to eliminate poverty.

Their goal is to reach the most people in need as quickly as possible. To do this, Unitus seeks out and partners with young, high-potential microfinance institutions (MFIs), helping them build capacity, attract capital, and achieve exponential growth. "Rather than directly providing microfinance services, Unitus connects the ambitious visionary social entrepreneurs  who lead our partner MFIs with the business expertise, capital investments, and innovative tools and services required to grow faster, dream bigger, and reach farther. Their success in turn provides hope and opportunity for thousands who would otherwise remain stuck in the downward cycle of poverty."

"Unitus believes in the inherent value of every global citizen. They see the potential of all individuals to change the world for the better, given the opportunity. They believe they can transform the future for million of the world's least fortunate by scaling up highly leverages, market-based approaches to fighting poverty using the power of microfinance. Once the working poor are no longer excluded from the resources and opportunities of the world's financial markets, they are empowered to realize their full potential, building stronger families, communities, and lives."

In just seven years the organization has helped their partners serve more than seven million clients. Unitus' goal is to help their partners extend their reach to 15 million families by 2010.

Unitus website is full of useful information about microfinance and their approach. For more information, including the various ways you can get involved please visit their website.

Micro-finance Week

Today kicks off Micro-finance Week. This week we'll be featuring a variety of organizations that use micro-credit and venture philanthropy to help the world's poorest citizens move towards a life of self-sufficiency. On a broader scale, micro-finance helps communities to get out of what economist Jeffrey Sachs calls the 'poverty trap,' by providing the assistance necessary to overcome poverty and create sustainable communities.  The organizations this week will should the wide range of projects you can support, regardless of how much you actually have invest. As you'll see, even an investment of $20 can make a world of difference to those who have nothing.

As an introduction to Micro-Finance week, what better place to start than where it began: Grameen Bank.

Grameen Bank first began in Jobra Bangladesh in 1976 as the Grameen Bank Project. In the Bangla language Grameen means 'rural' or 'village.' The project provided microcredit, (small loans to very poor people for self-employment projects that generate income, allowing them to care for themselves and their families), to the individuals in Jobra Bangladesh. By 1983 the success of Muhammad Yunus' project was evident. The project transformed to become a formal bank under a special law passed for its creation. 

Grameen Bank came into operation with the following objectives:

• Extend banking facilities to poor men and women
• Eliminate the exploitation of the poor by money lenders
• Create opportunities for self-employment for the vast multitude of unemployed people in rural Bangladesh.
• Bring the disadvantaged, mostly the women from the poorest households, within the fold of an organizational format which they can understand and manage by themselves
• Reverse the age-old vicious cycle of "low income, low savings and low investment," into virtuous cycle of "low income, injection of credit, investment, more income, more savings, more investment, more income"

GB's is a banking system based on mutual trust, accountability, participation, and creativity. The bank provides credit to the poorest of the poor in rural Bangladesh, without collateral. 'At GB, credit is a cost effective weapon to fight poverty and it serves as a catalyst in the over all development of socio-economic conditions of the poor who have been kept outside the banking orbit on the grounds that they are poor and hence not bankable. Professor Yunus, founder and Managing Director of GB, reasoned that  if financial resources can be made available to the poor people on terms and conditions that are appropriate and reasonable, "these millions of small people with their millions of small pursuits can add up to create the biggest development wonder.""

Yunus' theory proved correct. To date the total amount loaned since its inception is $7.68 billion, with $6.83 billion having been repaid. Grameen Bank can boast a loan recovery rate of 97.82%. It shows just how far trust and accountability can go.

In 1995, Grameen Bank decided is no longer would receive donor funds. In fact they had the money necessary to continue their work independently. Since 1998 the bank has been without donor funds or loans from local or external sources. Grameen Bank is owned by the poor borrowers (95%) and the government (5%).

In 2006, Professor Muhammad Yunus received the Noble Prize for his work with Grameen Bank.

As of February 2009, GB has 7.75 million borrowers, 97% of whom are women, with 2,545 branches. The bank provides services in 83,967 villages, covering more than 100% of the total villages in Bangladesh. 

Grameen Bank's website offers plenty of information on their initiatives, borrowers' successes, and a wonderful introduction into the world of micro-lending. I urge you all to visit Grameen Bank's website.

Also, if you are interested in learning more about Muhammad Yunus and Grameen Bank the following books are available:

Banker to the Poor: Micro-Lending and the Battle Against World Poverty by Muhammad Yunus

 Creating a World Without Poverty: Social Business and the Future of Capitalism by Muhammad Yunus

 The Price of a Dream: The Story of Grameen Bank by David Bornstein