Nick Kristof on Nicaragua’s Savings Revolution

I just read an excellent column by Nick Kristof of the New York Times about savings programs in Nicaragua. It seems like a natural follow-up to the post I wrote about reasons to resist microfinance in Nicaragua, as it presents a productive solution to the problems of poverty and usurious lending practices.

Here’s part of it:

Right now, the world’s poor almost never have access to a bank account. Cash sits around and gets spent — and, frankly, often spent badly.

“We used to buy a three-liter bottle of Coke every day,” recalled Socorro Machado, a 49-year-old homemaker in a village here in northwestern Nicaragua. That was a bit less than a gallon, and the cost of $1.75 consumed a large share of the family’s budget.

Then Catholic Relief Services, an aid organization, arrived in the village with a new program to promote savings. It provided a wooden box with a padlock and organized savings groups of about 20 people who meet once or twice a month, typically bringing 50 cents or $1 to deposit in the box.

Some of the money is lent out to start a small business, but the greatest benefit of these programs seems to be that they provide a spur to save.

“Now we buy a bottle of Coke just once a week, and we put the money in savings,” Ms. Machado said. She saves about $5 a month in her own name and another $5 a month in her son’s name and has plans to buy a computer for him eventually. [more]

No Pago! Reasons to Resist Microfinance in Nicaragua

This post originally appeared on myKRO.org on November 16, 2009.  I highly recommend clicking through to read the excellent comments from people who know more about Nicaragua.

“Why would borrowers in Nicaragua protest against microfinance?” my friend Michael asked me a few days ago.

Michael and I both majored in Latin American Studies at Berkeley. His email re-ignited my excitement for microfinance in Latin America. When I was studying abroad in Chile I interned with an organization called Accion Emprendedora, which sparked my interest in the intersection between business and social good.

Michael sent me this fascinating article: “No Pago” Confronts Microfinance in Nicaragua by Elissa Pachico: more »

Cow Dung, Poverty and Microfinance in Inner Mongolia

This post originally appeared on the Wokai blog on January 27, 2009.

What does it mean to be green?  How do energy sources relate to poverty alleviation in developing countries?  Who should be making decisions about rural energy use?

I’ve been thinking more about these questions lately.  We recently posted some new borrowers on Wokai, whose businesses focus on selling cow dung to burn as fuel.  Here’s one such profile:

Several things stand out to me in Aodunsiqige’s profile: her daughter’s poetic name and musical ambitions, her family’s transition from selling millet to lending equipment to selling cow dung, her awareness of options and prices for winter heating materials… more »

Obama, Microfinance, and China

This post originally appeared on the Wokai blog on December 29, 2008.

Yes, there is at least one connection between these three words.  Her name is Nancy Barry.

A trailblazer in the field of Enterprise Solutions to Poverty, her current work focuses on creating pragmatic ways for large corporations in China, India, Mexico, and Colombia, to create opportunities for the working poor in these countries.  For many years she was the President of Women’s World Banking, an international microfinance network.

I just came across this article from an Indian finance website, describing her role as a close advisor to Barack Obama.

Named one of the most powerful women in the world, Nancy M. Barry, 59, the Founder and President of Enterprise Solutions to Poverty and former President of the New York-based Women’s World Banking, is no stranger to the limelight. Known to be a close confidant and friend of the Obama family, she is now expected to play a key role in shaping the new US regime’s relationship with India and Indians. President-elect Barack Obama’s mother, Ann Dunham, worked with her as the first policy change manager of Women’s World Banking, from 1992 to 1995.

Says Barry: I see in Obama many of the qualities of his mother: the capacity to get to the heart of the matter, the ability to get different factions to work for common cause, and a passion to work together in building economies that work for the majority. more »

China’s Development Policy Goes Rural

This I wrote for the Wokai blog, October 23, 2008.

I just came across this excellent clip from CCTV, highlighting how China has shifted the focus of its development to rural areas, with a focus on microfinance (hat tip to Rich Brubaker):

Last year, when I was working for the American Chamber of Commerce in Shanghai, I interviewed Wang Li from Citi, who appears in this clip.  She described how the Citi Microentrepreneurship Awards in October 2007 served as a stepping stone towards the broader expansion of microfinance in China.  I am impressed to see how quickly these changes have occurred.

China has also recently transformed its rural land policies, allowing farmers to trade or rent the land on which they work. more »