Microcredit

Basics

• An emerging humanitarian effort approach
• Consists of giving small loans with little intrest typically, to people with little collatoral, employment, etc
• Similar in part to the "Teach Someone to Fish" metaphor
• Typically done to allow them to buy equipment, and start a business/service
• Is UN recomended to help aleviate poverty in developing areas (post sources later)
• Solves the The "Poor Can Only Afford to Buy A Tool Once" Issue to a certain extent
• Also goes well with Job Training and Entrepreneurial Training , and Business Plans + Business Drop Kits (forget if "drop kit" was the right term? Essentially all the paperwork, plans, and even machine parts etc in one "package" ) to promote success
• CAN be done in a corrupt/exploative manner, but assuming various watchdog organisations are involved etc, it tends to be very helpful in the serviced areas
  • Biggest issues seems to:
    • Large Intrest Rates (which is almost against the purpose OF microcredit)
    • Debt Traps
    • Paperwork etc (Can be solved with simplification, and "down to earth" education on the concept
    • Making sure the money is "spent right" (mainly solved via proper guidance, training, and follow ups etc)
• OSE Application could be a sort of "adopt a makerspace" type fundraiser program

Internal Links

• Social Business

External Links

• The Wikipedia Page on Microcredit
• A Vox Article with a more general overview of the subject, and summaries and sources of studies on the subject (Quote (of quote...) on a metanalysis (right word right?) on 6 studies “We note a consistent pattern of modestly positive, but not transformative, effects”) so not magical, but this does negate arguements of it causing harm (outside of the for profit corrupt microloan banks which have started to scam the target population)
• A 2012 TEDx Talk on Microfinance by Muhammad Yunus They Founded the Grameen Bank a group which nearly started the modern microfinance movement
• A 2016 Ted Talk On the Subject by Shivani Siroya