15 Jun The Power of Microfinance: How It Ends Poverty & Changes Lives
One of the things we’re focusing on through Tricord Global is giving the bank we’ve been working with in Uganda more opportunities by loaning more money. We do this a few times a year by hosting a capital raise. During the capital raises, people often ask me about the power of microfinance – why do we choose to make a difference in this particular way?
Today I’d like to answer that question and tell you why I believe microfinance is so important.
Statistics tell us that one person passes away in the world every three seconds from poverty or the effects of poverty. In fact, one and a half billion people live below the poverty line. A lot of you are Kingdom-minded people like me. We give to great causes and sponsor organizations. That is good, don’t get me wrong. I believe in giving to and supporting charitable causes. But often we don’t realize that charitable giving alone does not affect long-lasting change.
Here’s the thing: over 70 billion dollars were put into the continent of Africa over a period of about 30 years. Poverty in Africa grew from 11% to 68% with all of that donation money given.
Charitable giving alone is not the answer.
We must be able to help create a healthy economy in developing nations. In Africa, the NGOs (non-governmental organizations), have unintentionally created, in some cases, a welfare mentality. This is where people aren’t expecting a hand up, because they’re expecting a handout. We must continue to change that mindset in Africa. And not just in Africa, but in any developing nation in the world.
Microfinance allows us to do that.
When I give someone a dollar in a developing economy, I have to come back to America and raise that dollar again. Some charities like doing that and it is how the whole organization is run. But I’d rather see the dollar be more effective. Microfinance is the way we do that.
When we lend a dollar, that dollar is paid back with an interest rate that allows the operation to be sustainable in the country. That same dollar can be lent over and over and over again and have a great impact in the city and that nation.
The Power of Microfinance
Now you may be thinking: what’s the difference between microfinance and microenterprise? One of the differences can be explained through the following example.
In America, I’ve seen people raise money for sewing machines. They buy the sewing machines, and give them to people in developing nations. They give the sewing machines and put people in business. Instead of giving them money, like with microfinance, they give the people work. That’s why it’s called microenterprise. They actually provide the sewing machines but come back a year later, and the sewing machines are either sitting in an extra room or they’ve been dismantled and sold for parts. There isn’t much, if any, training provided and there isn’t any followup to check in on the business.
With microfinance, because the loan must be repaid, there is ongoing business training and lifeskill training that happens when the client come back to pay their loan. They sit in training for several hours. While collecting the loan payment, they also receive lifeskill and business training. This makes a dramatic and life-long impact.
The people are empowered and, therefore, are able to truly change their lives around.
It’s also in those very same training groups where the gospel is preached and shared with them. Here at Tricord, we’ve had many conversions about the Kingdom of God that have happened because of something said in the training groups.
So, when we talk about microfinance, we’re talking about a different way of thinking. Charitable giving and donation is important. But it’s not the only thing we should be doing. We also should be taking our money and investing it.
Tricord Global is currently accepting investments. You’ll be a part of the microfinance process I just described – providing a hand-up instead of a hand-out, giving business training to the people, and sharing the gospel for ongoing heart transformation.
Check out this video for pictures of awesome things that have happened all because of investments like yours! People are transforming communities, businesses, schools, and markets AND learning valuable business skills in the process.
When people invest with us, we put that money into the third world – Uganda specifically. And with that money we see city and nation transformation by following the principles that I’ve shared with you.
If you’d like to participate, contact our office at lilly (at) billyepperhart (dot) com or click below:
We believe that God has given us this Kingdom strategy to see lives changes and nations transformed through microfinance. I believe that as we stand together, we can take what we say in Wealthbuilders – making sense of making money for making a difference – and make it come true.