Lessons From Microfinance

July 27, 2015 

This morning’s post comes to us from CARE for AIDS summer intern, Katie Nunner. 

Natalia gets up again at 5:00 a.m. to prepare the morning meal for the family, get together her supplies for selling sweets at the schools, and steal a little time for weaving her latest mat. As the sun peeks over the horizon, she thinks about her three-year old grandson, Hernan, curious about the world and the kind of life he will have. She moves across the grimy dirt floor to prepare breakfast. She picks up some sticky corn dough and slaps the gummy mixture back and forth as it coats her palms. Finally it becomes smooth—morphing to the texture of her hands. A familiar task, one that seems mundane as she crafts the flawlessly round ball of dough again and again.

She can make a perfect tortilla—impeccably round, with precise depth and consistency. I watch her and she motions for me to try. I pick up the ball of dough and take it to the well-used iron press to construct my tortilla, but to my surprise, my creation looks like a childish version of Natalia’s perfect creation.

Natalia doesn’t say a word, she merely grins and gestures to grant me a few more attempts at the press. I begin to notice little nuances in her construction of the tortilla like the way she carefully pats the dough with the press and then lightly picks it up to bring it over the open fire. I gradually begin to get better and better at creating the tortilla, but I takes some time to completely understand.

In college I had the opportunity to spend time with and learn from a host family in Mexico. I’ve always been intrigued learning from others and their stories—so much so that the experience prompted a journey of research for the next year at school, looking into the microfinance industry.

The World Bank estimates there are about 2.5 billion financially excluded adults in our world today, with almost 80 percent of those individuals living on under $2 a day.

Similar to other families in their community, my host family made money, but their income wasn’t stable. It fluctuated depending on the kind of project they were working on, not to mention their health and the state of their animals. This provokes the question: is there something that could make a difference in their lives and of poorer people in even more isolated locations? Simply, what can be done to help the poor?

Microfinance seeks to offer a solution by combining the talent and skills of poor individuals to harness their entrepreneurial and creative spirit in order to “help them help themselves” by creating economic opportunities.

Nobel Peace Prize winner, Muhammad Yunus was wildly successful with implementing modern microfinance in Bangladesh, sparking new initiatives of hope for investing in untapped opportunities around the world.

Because the results of microfinance have created opportunity, in recent years there has been skepticism around the topic and concerns with the structure of microfinance institutions because of loosely defined goals in a for-profit structure—exploiting clients with high interest rates while making a large return for shareholders prompting the question: is it ok to make money off the poor?

Peter Greer of HOPE International, a network of microfinance institutions and savings and credit associations operating in 17 countries around the world, wrote an insightful piece reflecting on recent critiques of the modern microfinance movement. He offers advice on using critiques as lessons on ways we can properly offer microfinance services.

Greer suggests the idea that institutions that are truly effective not only look at financial returns, but invest holistically in their clients by offering training, counseling, and community development programs. As with other poverty alleviation programs, microfinance is a tool that when applied in a particular context, can be very positive for communities. When we fail to remember why we are using this tool–to provide redemption and healing to communities–then we overlook its lasting impact.

Even though sometimes it seems like our goals of restoring communities can seem overwhelming, as stated in When Helping Hurts, we can’t become paralyzed. We aren’t perfect, but as we’ve discussed in our meetings about the culture of CARE for AIDS, we have a responsibility to “make it better” by using our God given talents to demonstrate God’s restorative healing both body and soul.

Natalia taught me to properly make a Mexican tortilla. She helped me see my mistakes, see where I needed to have a clearer understanding of the task I was trying to complete. I believe she has a lot more to teach me. I think we can find ways to work together to improve some of the gaps in both of our lives, both physically and spiritually.

At CARE for AIDS, we are working to partner with local churches to equip them to be the primary place for healing and restoration for the HIV+ population in Kenya. Our intentional ministry is always growing and learning from all aspects, in the local Kenyan community and in the US. Please continue to pray with us as we work together to restore human dignity and worth in Jesus Christ.