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USCB class aids developing nations through microlending
Published Tuesday April 24 2007
By JIM FABER
BLUFFTON -- A class at the University of South Carolina Beaufort might end up helping a welder in the West African nation of Togo make and sell school supplies in his village.
Or it might help a clothing-shop owner in the former Russian nation of Tajikistan take a trip to a wholesale market to buy better garments to sell.
Or it could help a Bulgarian improve his tavern to attract more business.
With just $400 to invest, the USCB class on the South Campus at Bluffton may end up helping those entrepreneurs, or others like them, using a process called "microlending" through Kiva.org.
Davis Folsom, professor of business administration and economics at USCB, received $200 from the Unitarian Universalist Fellowship of Beaufort and contributed $200 of his own money so four teams of students in his Business and Society class could each lend $100 to business people in developing nations.
The idea is to help the poor create or improve businesses to improve their society. Last year, the Nobel Peace Prize went to Muhammad Yunus, founder of Grameen Bank, a pioneering microlender in Bangladesh.
Since the money is a loan -- not a donation -- the USCB students had to balance wanting to help those who seemed the most desperate with those who actually had a good business, even placing more emphasis on the latter, said Erica Veit, a junior in the class.
"We wanted someone who would give back to the community and do more than just help their own family," said junior Fripp Cromer.
The lenders start by making a loan as small as $25 on a credit card. Kiva transfers the money to local partners in the nations -- partners who are also responsible for vetting entrepreneurs before they are listed on the Web site.
Over time, the local partners collect repayments, and usually over six to 12 months, the funds are returned to the lender for withdrawal or reinvestment.
When the class met Thursday, some of the students' choices had already been funded, even though their final decisions were made just hours before.
The class will meet again today to lend the money.
Folsom hopes the students' choices will lead to solid businesses -- that way the loans will be returned and reinvested by future USCB classes.
Copyright 2007 The Beaufort Gazette • May not be republished in any form without the express written permission of the publisher.