'Lending Promise' to fund Nepali women with microcredit

Press Release from SocialFunds.com (8th August 2006)

New Nonprofit, Lending Promise, to Lend Poor Women Dignity as Well as Money

Microcredit comprises tiny loans – often less than $25 per person – to people too poor to qualify for traditional financing. A loan goes to a group of co-signers, typically women. Although each one forms her own business such as a snack shop, farm, tour guide or handicrafts business, the women repay the loans as a group. Later, the groups often pool savings, making loans themselves to members who expand their businesses, Taylor explained.

According to Grameen Bank, the Bangladesh-based forebear of microcredit, although banks view poor people as bad credit risks, microloan borrowers have achieved an average repayment rate of 98 percent. That’s significantly higher than the 85 percent rate guaranteed by the U.S. Small Business Administration.

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Lending Promise will give its first loans this fall to Nepali women. The world’s fifth poorest nation, Nepal is ravaged by a Maoist conflict that has caused an estimated 12,000 deaths and a decline in tourism – a major revenue source. Taylor, who traveled there in March, met over 75 mothers whose homes are without electricity or running water. "I asked children what they want to be when they grow up," she said. "Because villagers spend their time on tasks like hauling water jugs, most kids don’t think about the future. I want them to have dreams – and live them."

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