loans to women

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We are borrowing an idea that was originated by the founder of Ebay, Pierre Omidyar, and carried forward by the Grameen Bank in India, that of offering small loans in what is called "micro-financing" to people who otherwise could not obtain the most valuable assist in starting a new or expanding an existing small business, CREDIT.  This idea was originally intended to be implemented after the death of our Founder because the administrative time and/or the funds would not be available until then.  However, should this Foundation obtain sufficient volunteers now who can carry the workload until the Founder dies, he has promised initial funding even prior to his death.  [[[Note as of 10/17/07 - some volunteers have stepped forward and we are progressing with early attempts to move this program along. However, we will still need local organizations to serve as "holders and administrators of the loan pools" (which we will fund) for this to continue.]]]  [[[Note as of 2/20/10 - although we spent countless time (many weeks) obtaining and training volunteers, we finally gave up on this --- although we came so close to making this happen, in the end, this turned out to be our biggest failure and biggest disappointment.  However, after the founder's death, he has no objection to the then current Trustees reinvigorating this project and starting a very needed "loans to local women" project once again.]]]  [[[Note as of 4/16/10-it has come to my attention that a group MAY BE offering no- or low-interest loans here in SMA - the contact information is currently "Contact Ezequiel Mojica. He does good work with small loans. Apoyo's web page is: www.apoyoemprendedores.weebly. com".  The Founder went to their web-site and realized that this was the local plan that existed at the 2007 time that we were trying to launch our "Loans to Women" project.  While we reached out to them by sending an email to (I think) Ezequiel, he never responded.  We did state in the email that we were willing to fund them (or donate funds to them) but no response was received.  So, the Founder gives permission to future Trustees to reach out to them again after his death, but the following must be verified in more than merely words:  they must be offering no-interest (or interest of less than 5% annual rates - that is not 1% each month, which is much higher than 5% annually), they must meet our "same as other grantees" requirements of transparancy completely (including in their case, reasonable - this must not be a scheme - compensation to their group's insiders and employees and volunteers) and continuity generally. And they must continue to do so during any period where we make (at first, small grants of us$1,000 a year, and later grants of higher amounts of as much as either us$5,000 to maybe even us$10,000 a year) grants to them.   And lastly, we must make any grants to this organization ONLY AFTER we have satisfied our own financial needs for grants to our regular and already "approved" (by the Founder) grantees.

[[[[ March 21 2012  Be sure that you read and understand and consider the implications for your organization of the new fact that we are going to dissolve this Foundation a short time after the Founder's death, whether or not you have met all of our requirements WELL BEFORE his death.  Your share of the endowment will be decided by him before he dies AND it will be based upon your cumulative input year after year.  You have been provided guidance on this in the table at the top of subsequent changes -- However, the idea of the Loans to Woman is still one that the Foundation, even in terminated form, believes in.  We would hope that one of our grantees - preferably Mujares en Cambio, but any other one would be acceptable - just pick up the reins and use whatever you find on this web-site - see links at the top of this page, too - and do what you can to help the women of this town obtain credit, such a huge help in starting any business.  Obviously, the following paragraph, written prior to the "dissolution of this Foundation" decision, is now somewhat changed but the principles still apply.]]]]

Some time after the Founder's Trust enables this Foundation to obtain all of its promised endowment (which will be something in excess of us$2,900,000), the Founder would like the Foundation's Trustees to implement all of the following, presented below in current sketched-out form:

Put aside a small portion of the Endowment (perhaps us$10,000 for starters) for this program.  If it is successful and runs well, the Endowment can increase somewhat as needed.
Write up the principles under which this Loan Program will operate.  As a start, the following ideas should be considered:
The individual loans should be around us$100 to us$500.   Perhaps us$100 to us$200 is a good starting point.
Each recipient should have some sort of written idea and written plan, and if not written, at least formulated sufficiently so that the Foundation's overseer can write up something to both see that the plan has a good chance of working and also to measure results against the original plan.
The re-payment schedule must be part of this plan.
Interest on the loan must be charged, but an extremely low rate should be used (anywhere from 1% to 4% annually).
so as to NOT compete with local banks, each applicant should demonstrate that she could not get a loan from such banks.
if possible, "loan pools" can be utilized wherein each member of the pool is encouraged to pressure each other member of the pool to repay on time. This idea is new to us and therefore sketchy and details should be pursued on the internet with searches made on words like microfinance, "loan pools", collections, etc.
Although there should be an effort to collect all loans, I think that this program should not expect more than maybe 75% to 90% return of loans and therefore may really be considered, in sum, as a separate "grant" program of this Foundation.
As a result of the above point, the initial us$10,000 or so will have to be reviewed from time to time and, if the program is considered a success, probably increased based upon results.
this program will require more supervision than the time required for the original programs of  grants, investments, etc., but it has the best long-term possibility of causing positive economic change here in town.  Credit causes businesses to grow and prosper and create new jobs and improve the economic situation of many people surrounding the originator of each business.
Perhaps personnel from Mujares en Cambio (or Rotary, or others close to this concept of helping local women) may be enlisted to aid us in the process of spreading the word of availability of credit which aids us in obtaining responsible recipients of loans.  We also could use additional personnel to help us in training people in how to run a business (in ways other than just making a product). All are quite necessary to make this program work.
Be careful to make sure that this is not merely a giveaway, but in reality is a REAL attempt to make credit work in this town.  And, if successful, this becomes a real attempt to build more local businesses and work opportunities.  In the attempt to make this program succeed, attempts should be made to enlist as many of our other grantees in small parts of the overall process.  For instance, those grantees who provide scholarships can be encouraged to provide volunteers (from among their graduates) to work in any part of the process, either in the acquisition of women for loans, or administration of the various parts of the  loan process, or even the training in how to run a business.  Skills acquired in scholar's education could certainly be utilized in the ongoing needs of the various start-up businesses and later these same businesses may need additional graduates in full or part-time paid employment.

It should be revealed here that we made an attempt to start the Loans to Women project in late 2007.  We got sufficient volunteers and other people interested in the project and moved ahead with it.  We found a stumbling block at the point of needing a unmanned "desk" at some permanent public location where we could tell applicants to apply for (and later repay) their loans. This was a place where we also intended to give periodic lectures and answer questions on how to run a business.  We had interest from DIF but no follow-up from them.  We asked for but received no help from the Biblioteca, Mujeres en Cambio, and other obvious organizations. The results of our planning of the processes and procedures, "ready to roll" on this, are still available on this web-site (see LINKS at top and left side of this page). [[Note as of 12/10/10-it has come to my attention that our idea of having a central meeting place does not work.  The women in question can not travel into town as easily as I expected.  We would have to arrange small groups to convene in the campos and use these groups for both collections and training and answering their questions.

Although I can't substantiate this, I think we had opposition from locals who, themselves, provided loans at much higher (possibly 20% to 50% or even higher) interest rates and did not wish our lower rate competition.  A thought occurs to me here, though.  We might wish to contact the local banks (who certainly would not be upset at our low principal loans, with the thought that the banks would later prosper by the businesses that we finance succeeding and later becoming larger principal borrowers themselves, not to forget that the entire town prospers economically by the success of the women who succeed and the bank, again, prospers as a result).

Some links to other web-sites that may prove to have useful information:

http://www.GrameenFoundation.org

http://www.grameen-info.org/

en.wikipedia.org/wiki/Grameen_Bank

en.wikipedia.org/wiki/Microfinance

http://kiva.org/

http://www.socialedge.org/blogs/kiva-chronicles

http://www.spbd.ws/

http://usinfo.state.gov/journals/ites/0204/ijee/casagrande.htm

http://www.promujer.org/

 

“Underpromise and Overdeliver”

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