11/3/06

Millions in credit to the world's poor

Muhammad Yunus founded the Grameen Bank in 1976, and the idea of reaching billions of the poor by achieving "scale" - a word invoked ceaselessly in the microfinance community- has enticed foundations, rich individuals, even investors into channeling millions into microfinance.

The $1.2-billion Michael and Susan Dell Foundation-established by the founder of one of the world's largest computer manufacturers-has begun making grants to microfinance institutions in India, a country of 1.1 billion people, most of whom have no access to financial services.

In October, 2005, Google established a philanthropic entity called Google.org, with seed money of about a billion dollars, to fight disease, global warming, and poverty; microfinance is expected to be a key component of its poverty portfolio.

And last April the Bill and Melinda Gates Foundation announced that it would devote an undisclosed amount of money to expanding financial services for the poor in developing countries. Dr. Rajiv Shah, who oversees the new Gates program, said of microfinance, "This can reach hundreds of millions of people, and do so in a way that helps them move out of poverty and that sustains over time."

[Excerpt of an article by Connie Bruck, The New Yorker]

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