Tag Archives: microfinance

Beyond Microfinance: Opportunities for Change

Another Track in the upcoming ForSE 2008: Forum for Social Entrepreneurs

Beyond Microfinance: Opportunities for Change

Microfinance, as demonstrated by Nobel Laureate Mohammad Yunus, provides disadvantaged entrepreneurs with small loans to run their businesses and eventually help lift them out of poverty. This has become a wide spread phenomenon all over the world encouraging millions of families out of poverty.

What’s next? There is a huge business opportunity for both, investment in the MFIs and providing other business services to these micro-enterprises at the bottom of the pyramid.

While commercial banks are satisfying the demand for capital to the MFIs , the social entrepreneurs with social business ideas will hopefully fill the gap by providing services to the poor entrepreneurs to run and scale their businesses successfully. Prof. Yunus’ has exemplified this concept of a social business with a collaborative effort with Dannon in Bangladesh, that brings low cost nutritious meals to the poor while employing local farmers and citizens. This is a win-win situation where the commercial banks, MFIs, social businesses and the aspiring entrepreneurs all profit!

Registration Opens for ForSE 2008-Forum for Social Entrepreneurs

In 2007, I helped found an annual conference on Social Entrepreneurship in partnership with Boston University and the Deshpande Foundation called the Forum for Social Entrepreneurship or ForSE for short. ForSE brings together social innovators with leading business professionals, investors, donors, government officials, academics, and students to facilitate the sharing of new technology and business ideas along with hard-earned management learnings to foster informed discussion and action on new social venture concepts. Continue reading

Tapan Parikh – Technology Review’s Humanitarian of the Year 2007

I had the pleasure of meeting Tapan Parikh a few weeks ago when he presented on a panel at a conference to celebrate the Golden Jubilee of my alma mater, IIT Bombay. The panel focused on the latest trends in technology with the rest of the panelists discussing emerging areas in nanotechnology, biomedicine and energy. Tapan provided a refreshingly different viewpoint that emphasized the needs of the end user in developing countries. By harnessing technology to make things simpler, Tapan has provided platforms that make the daily grind of field workers in rural parts of the world a lot easier. Continue reading

Gates Foundation gets into Microsavings

The Gates Foundation has made some major investments in the area of finance over the past few years. Now, based on their findings and experiments, they are making a big push into the area of micro-savings. Traditionally rural finance has focused on providing micro-credit services to the poor. Only recently have some of the micro-finance organizations started extending their services to include savings and insurance. In most cases the issue has been local regulations and banking controls.

In a recent article in the Wall Street Journal – Giving a Lot for Saving a Little – the author points out several issues why savings schemes for the rural poor have not taken off. Among the issues identified:

  • Strict regulations on entities that hold deposits
  • Lack of remote branches that allow easy access to money
  • Too costly for traditional banks to provide services for the size of accounts Continue reading

Prof. Muhammad Yunus, Social Business and the Future of Capitalism

Earlier this year, Nobel laureate Prof. Muhammad Yunus was the invited guest speaker at MIT’s 142nd commencement. In his prepared remarks to the students he outlined how he started microcredit thirty plus years ago from a simple desire to free villagers near his university in Chittagong from the penalizing interest that they paid to moneylenders.

Today his organization, Grameen Bank, has grown to cover 7.5 million borrowers in Bangladesh, 97 percent of them women. From this beginning he has expanded to provide services and products in a number of areas ranging from health insurance, to affordable cell phone service with Grameen Phone to renewable energy solutions through Grameen Shakti.

Drawing from his successes with these businesses, Prof. Yunus has refined an overarching social business philosophy that he recently published in his latest book “Creating a World Without Poverty – Social Business and the Future of Capitalism“. Continue reading