"We live in a world that's interdependent, but insufficient, in three majors ways. It is first of all, profoundly unequal. Half the world's people still living on less than $2 a day. A billion people with no access to clean water. 2 and a half billion with no access to sanitation. A billion going to bed hungry every night. 1 in 4 deaths every year from AIDS, TB, Malaria, and the variety of infections associated with dirty water, 80% of them under 5 years of age.... When I think about the world I would like to leave to my daughter and the grandchildren I hope to have, it is a world that moves away from unequal, unstable, unsustainable interdependence to integrated communities."
-- Bill Clinton (2007)
The Challenges Facing the Poor[edit | edit source]
In Sub-Saharan Africa where Promote Africa works, the number of people living on less than $1 per day has grown from about 231 million to 318 million people. Extreme poverty persists as a major challenge for the world to face. A complex set of factors—lack of access to basic human health services, clean water, education, technology, among many others—weave what has become known as a “vicious poverty trap” preventing millions worldwide from breaking free of the cycle. Apart from the above factors there is wide spread political instability due to bloody ethnic clashes,dictators who consumed all the resources and private armies who control diamond trade popularly known as blood diamond.
However, leading development experts worldwide have come to identify that vital tool the impoverished need to break out of this cycle: access to credit, capital, and other essential financial services. Thus, was born the concept of Microfinance.
A Solution: What Is Microfinance?[edit | edit source]
In response to this need, creative and innovative individuals in the 1970s and 80s began experimenting with extending credit to the poor. These pioneers overcame many biases that had kept the poor from being included in the formal financial sector as they created a whole new arena of finance known as microfinance. Their success has culminated in the year 2005 being designated by the United Nations as the Year of Microcredit; the next year, one of the foremost microfinance pioneers, Muhammad Yunus, was awarded the Nobel Peace Prize for his work in Bangladesh and with the Grameen Bank.
+Micro-credit as loans would be used for income-generating, long-term productive purposes such as:
- starting and scaling-up a food-stand (investments in cookers, ingredients, utensils, the cart)
- starting a clothing repair/new clothing shop
- converting part of the home to a hotel
Microlending is a new emerging solution to economic development because it allows its recipients to in some creative way reinvent their lives; it is a bottom-up, grass-roots approach that recognizes the entrepreneurial and tenacious spirit of the poorest of the poor. It is a way to build infrastructure, save lives, create role models, unlock people's potential, and ultimately push a hurting economy forward. Many of these loans are being given to women, who have traditionally had a lot of trouble with social empowerment, and who are gaining necessary status and power to overcome inequality and domestic abuse. In addition, according to the World Bank, "Placing more resources in the hands of women results in greater spending on human capital goods: household services, health, education, and food." *
Remember that microlending is never simply about providing handouts to these individuals; it is about providing a hand up—a long-term source of income, livelihood, and lifestyle for people who will get to spur innovation, unlock their potential, create a microbusiness, and help provide for the needs of their families. Then, they'll pay their loan back, creating a sustainable system through which to give aid at minimal or no price, and magnified results, loan cycle after loan cycle.
- Engendering Development, A World Bank Policy Research Report, 2001.
How We Will Use Your Donations[edit | edit source]
To ensure that good will come of all tax-deductible donations this year, the very first thing we're doing is putting it toward our first cycle of loans to Project HOPE's Village Health Bank, consisting of 20 people: caregivers to the elderly, orphaned and vulnerable children, and at-risk young women. Once we've met their loan needs, we'll put money toward community development projects: Ongandjera Solar Ovens Project for elementary schools (which encourages nutrition and enrollment), BEN Namibia (bicycle transportation, income-generation, and even ambulances), and Yelula, an HIV/AIDS prevention and mentoring network. Then, when we think it's the right time to expand, we'll build that website which will allow you users to donate and lend money directly toward sustainable lifestyle and development initiatives. We'll even build a hedge fund to lower your risks of losing even a cent by 95%, to further encourage micro-lending.
The biggest goal of our microfinance project is to put in your hands the ability to lend and donate to these amazing causes directly, and even to have full choice in which projects your donation will support. Since this is year one of our Microfinance project, we don't yet have that website up yet--we don't have the funding. Once we do, we can and WILL extend our campaign to more than asking for donations However in order to start up, we need to ask for money once, to create something actually self-sustaining: a website that will give social investors like you, but around the entire world, the ability to directly donate and loan to the causes of your choice. If you invest in a cycles of loans, as soon as they are repayed (Project HOPE has had a 96% repayment rate, and 100% with the Village Health Bank), that money will be returned right back to you, to either buy that new laptop, or to reinvest it into another fulfilling project of your choosing. Your efforts toward this self-sustaining platform, once sustainability is achieved, will be echoed and echoed and echoed in its contributions to long term economic and individual development in communities and in people.
As it is, the entirety of microfinance has still only reached about 5% of the world’s poor living on less than $2 a day. There is much work to be done, especially in Africa where microfinance institutions (MFIs) are so significantly underrepresented; 70% of MFI are in Asia, 20% in Latin America, leaving only 10% to be shared between Africa and the rest of the world.* The volume that has flown through all microfinance platforms similar to the one we aim to build, where all five major sites were developed only in the last 3 years, is $55,800,00 USD! Imagine how much value will come out of your contribution to creating a site which will open up more channels into Sub-Saharan Africa.
- The MicroBanking Bulletin #15, Microfinance Information eXchange, 2007, pp. 30-31
Conclusions[edit | edit source]
Please do learn more about all we do at http://www.PromoteAfrica.org --there's a wealth of information here.
Here's the page for Micro-finance in general see: 
Feel free to contact me with any and all questions, I'd love to help you learn more.
Director of Operations
Promote Africa, Inc.