Microcredit: Creative Capitalism

<p>The traditional banking system isn’t set up for the destitute. Though the poor in developing countries often need only $100 to become self-employed and self-sufficient, a large financial institution would, on the rare occasion when such a loan was granted, consider it a high-risk investment and charge an exorbitant interest rate. Banks involved in the microfinance movement, however, recognize that such small loans help eliminate poverty. These microcredit organizations — of which there are now more than 7,000, serving 16 million people — often target women living well below their country’s poverty line, reasoning that a woman’s economic status more directly affects children. Firms that extend microcredit have also modified the traditional banking by providing more client-centered services, supplementing loans with job training, facilities, and peer networking. They also encourage communities to pool their loans to ensure group repayment. In return, recipients have shown a higher propensity to repay the money than wealthier nations.</p>
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<strong>Go there >>
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<a href=”http://www.microcreditsummit.org/”>Microcredit Summit Campaign</a>
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<strong>Related Links:</strong>
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<a href=”http://en.wikipedia.org/wiki/Microcredit”>Microcredit Wikipedia Entry</a>
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<a href=”http://www.gdrc.org/icm/”>Virtual Library on Microcredit and Microfinance</a>
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<a href=”http://www.enterweb.org/microcre.htm”>Microfinance and Microcredit Directory</a>
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<strong>Related Links from the <em>Utne</em> Archive:</strong>
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<a href=”/web_special/web_specials_2004-10/articles/11405-1.html”>Time Banking</a>
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<a href=”/pub/2004_125/gleanings/11358-1.html”>Money and the Middle Way</a>
<strong>($$)</strong>
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<a href=”/pub/2003_118/promo/10640-1.html”>Bucking Economic Greed</a>
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