It seems we have some strong nay-sayeres in the camp.
I published a journal entry in my personal blog of our activities yesterday visiting the village and seeing first hand micro-finance in action.
Anonymous posted this comment a short while later:
“Anonymous has left a new comment on your post “breaking the cycle of poverty“:
This is quite frankly one of the most racist schemes I’ve come across in recent years. For years, western colonial and corporate interests have raped South Asia of its resources. The state you’re in….Andra Pradesh….has witnessed the highest number of farmer’s suicides since the onset of schemes like the micro-credit program. Do you have anything to say about that? Do you feel any sense of responsibility for even supporting such schemes? The poverty in India persists to fill the fat bellies of the west. And the saddest part in this whole matter is that now it’s our own people who have decided to feed on the carcas…..squeezing what blood there’s left of the world’s poor. The micro-credit program has been detrimental to the poor of South Asia. There has been no trickling down of wealth. People continue to die to find ways to pay off these loans, while big corporations continue to kill the competition and corner any given market.
When will we learn? Your paycheck tomorrow will not be a result of your hard work. You are sadly mistaken if you think it is. That claim to success is connected to the blood and sweat of millions around the world who continue to slave for pennies.“
Since I’m sure we all have our take on this issue, I decided to throw it out on this forum to stimulate some discussion.
To post your comments for our Anonymous friend, please visit http://starworld-ria.blogspot.com
by: Rehan Choudhry
Ria, here’s what I posted on your blog in response to the previous anonymous post:
The problem we’re seeing here is a blatant distrust for business. I completely sympathize with this individual’s views as I feel they are probably based on his/her own personal experiences. When corrupt organizations employ micro-lending as a business model solely for profit, the poor are obviously going to suffer. But looking at basic economic growth models, micro-lending (when executed ethically) is essential to spurring economic growth in impoverished communities. So, to discount the entire concept is counterproductive. I feel this responder should research the generic micro-lending model and analyze the benefits it provides to the poor. Then look at new organizations like Kiva.org, Unitus and the Grameen Bank as models for the way micro-lending should be conducted.
To chalk micro-lending and other forms of poverty alleviation up as a loss will not solve the problem. The purpose of Ria’s trip to India is to see what hasn’t worked and understand WHY it hasn’t worked. This is in an attempt to fix the broken models and finally do good in the world.
Business has done and continues to do a lot of damage to the world. But there as long as there are people like Ria trying to change business for the better, there’s still hope in the world.
- Rehan
by: ehofmann
Very well written, Rehan.
We had a discussion the other night about credit and lending in general. Who hasn’t been tempted to go after that big purchase because Mastercard says you can pay off it later? How many out there are saddled with a mortgage or a house payment, or hundreds of thousands in student loans because you are pursuing a dream? The people on the trip (and our classmates at home) have traded in our paychecks for debt, and one only has to look around (or turn on Oprah) to see the incredible amount of debt to credit cards, banks, payday lenders, or loan sharks.
To Anonymous: I was skeptical too. When my eating house at Davidson went to the president of the college to ask for a loan, he asked my roommate and me what we were going to do to fix the problem. He wasn’t giving us a bandaid. We had no answer for him. That has stuck with me for a long time. What we are doing is like charity with the stress of repayment. After all, these women have never taken Business Plan Development with Germain Boer. What if they don’t have marketable skills? Aren’t we just throwing them to the wolves?
SKS requires an intensive training program for all interested parties. The course charges nothing, and provides meals and other amenities for the women so they can focus on the project. There is no obligation or pressure to take loans, and as we found out, there are some businesses running fine without loans.
What really changed my mind was being there with the women. The feeling of empowerment pulsing through the village was palpable.
SKS is a first mover within many of these villages, and as others move in, the competition will grow and services will improve while costs drop. SKS gave up their NGO status and operates as a for-profit business, which they believe drives them to be better while answering to their books. Our dinner conversations have included ways to improve the system already.
Is this system perfect? No. But I do think it’s an improvement. And every little bit counts.