Lending to empower
By: Laura Armstrong
Issue date: 11/13/09 Section: Opinions
My previous column argued that feminism and gender equality have a new meaning in the 21st century, which is holistic poverty relief. Several readers asked me how this poverty relief might take shape. Here are two ways: microfinance and empowerment.
Simplified, microfinance is lending small amounts of money to people of limited resources who have potential to create a small business or co-op. Impoverished microloan recipients must demonstrate a small savings and are given the loan at a high interest rate, usually ranging from 15 to 40 percent.
Microfinance is effective (though there are examples of ineffective investments) because it allows someone the freedom to invest his or her talents and limited resources. Last fall, I visited El Potrero, El Salvador, and met a woman who was skilled in weaving hammocks. While she used her skill well to weave hammocks for herself and her family, she possessed the untapped potential to sell hammocks to visitors like myself or to her neighbors. If she were to apply for a loan with a microloan organization like Kiva, she would have the money to buy materials to make more hammocks. With the sale of her hammocks, she could then repay the loan with interest, learn business skills and invest that money in her community.
While the economic strategy of microfinance is essential, the human development that it facilitates is equally critical.
Microfinance assists in empowering individuals (especially women), a value that is integral in alleviating poverty. Think of when you've accomplished a difficult feat like your first college final. After arduous hours of studying, you've learned of your grade and are content with it (hopefully). While the value of that grade may satisfy you, the most encouraging aspect is that you were successful; you set your mind on a task and completed it well. This is empowerment.
The backdrop of traditional feminism creates a negative connotation of "empowerment;" a word often linked to negative concepts like a power-trip, overpower or abuse of power. However, empowerment, as it relates to the 21st century definition of feminism, is simply the realization that "I am capable" and it allows one to feel ownership of his or her circumstances.
Simplified, microfinance is lending small amounts of money to people of limited resources who have potential to create a small business or co-op. Impoverished microloan recipients must demonstrate a small savings and are given the loan at a high interest rate, usually ranging from 15 to 40 percent.
Microfinance is effective (though there are examples of ineffective investments) because it allows someone the freedom to invest his or her talents and limited resources. Last fall, I visited El Potrero, El Salvador, and met a woman who was skilled in weaving hammocks. While she used her skill well to weave hammocks for herself and her family, she possessed the untapped potential to sell hammocks to visitors like myself or to her neighbors. If she were to apply for a loan with a microloan organization like Kiva, she would have the money to buy materials to make more hammocks. With the sale of her hammocks, she could then repay the loan with interest, learn business skills and invest that money in her community.
While the economic strategy of microfinance is essential, the human development that it facilitates is equally critical.
Microfinance assists in empowering individuals (especially women), a value that is integral in alleviating poverty. Think of when you've accomplished a difficult feat like your first college final. After arduous hours of studying, you've learned of your grade and are content with it (hopefully). While the value of that grade may satisfy you, the most encouraging aspect is that you were successful; you set your mind on a task and completed it well. This is empowerment.
The backdrop of traditional feminism creates a negative connotation of "empowerment;" a word often linked to negative concepts like a power-trip, overpower or abuse of power. However, empowerment, as it relates to the 21st century definition of feminism, is simply the realization that "I am capable" and it allows one to feel ownership of his or her circumstances.