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Smart Man and Smart Woman Online: Introducing the Grameen Foundation

Dear Readers, Jane has an especially important and marvelous interview session for you today. You may notice that our blog has a blogad for the Grameen Foundation, a group that exists to empower poor women in underdeveloped countries. We are proud to have this ad on our blog.

Imagine our delight when Ken Liffiton, who wrote to us to tell us about Grameen, agreed to be a Smart Man Online, and then introduced us to his colleague, Chandni Ohri, the Smart Woman half of this interview today.

As you read about this, we hope you will reflect on the joys of your life, and on how the world is shrinking--making us all neighbors. We would like to think that, like all good neighbors, you will click on the Grameen ad or the link in this interview, not only to see what it's all about, but to join in supporting the hard work that goes into a charity such as this. And, we hope that you will take Ken's and Chandni's words to heart. Because it's that time of the year-- when sharing is the better part of caring.

Lip-sticking: We’re proud to be able to bring this important message about Grameen Foundation USA to our readers during this holiday season. After all, someone famous once said, “It is better to give than to receive,” and we agree. While your web site gives a fine explanation of “Microfinance,” and how it benefits women all over the world by giving them improved status, can you tell us, in your own words, how it does that and what makes it so effective?

Chandni: Banks in developing countries are pretty much similar to banks in the US to the extent that they require you to fill out lots of papers and provide collateral before giving you a loan. In the developing world this system deems ‘ineligible’ a majority of the population.

If you are a poor woman who is illiterate and has no assets – so you cannot complete paperwork or offer collateral – then the only way you can get capital for your business is to go to a moneylender who charges such high interest rates that you will only be able to eke out your daily subsistence with your income.

Microfinance is a concept that turns traditional banking on its head. You are usually eligible to receive microfinance services only if you are poor and have no assets. This concept was pioneered by Prof. Muhammad Yunus, an economics professor in Bangladesh and the founder of Grameen Bank, one of the largest microfinance institutions in the world, which serves almost 4 million clients (more than 95% of them women) in Bangladesh.  At Grameen Foundation USA, we’re helping microfinance take root around the world.Womanbankbook_grameen_foundation

In the Grameen methodology, women form groups of five and jointly guarantee each other’s loans. Loans are usually about $100 and are repayable (with interest) in small, weekly installments over the course of a year. Poor women invest this money in an income generating activity – a borrower may buy a cow to sell milk or a sewing machine to make clothes to sell or use the money to buy stock for trading. Income, thus generated, is used partly to pay off the loan and partly for household expenses.

Microfinance is a simple yet powerful concept. It provides credit to the people who need it the most. It provides credit to them on terms suited to their needs, not needs of the bank or shareholders. Microfinance institutions are effective because they do not dole out grants – they give loans and charge interest so people who access these loans utilize them in the best manner possible. Microfinance institutions themselves can become self-sustaining through the income they earn as interest so they in turn do not remain dependent on grants from donors or government support.

There have been hundreds of research papers written on microfinance and there is sufficient evidence that it not only helps the poor increase their incomes but also has spillover positive effects in women’s empowerment, and children’s health and education.

It’s an ideal time to recognize and support the spread of this concept – the UN has named 2005 as the ‘Year of Microcredit’.

Lip-sticking: We’re especially interested in your work in India, since we have friends here in the states who come from India. We cherish their friendship--- which makes us eager to hear about your work in their native country.

Chandni: India is a very important country for Grameen Foundation USA – in fact, I’ll be leaving this afternoon to spend a month there working with our partners.

India has a large population that is poor, with microfinance institutions that are expanding rapidly to serve them. We currently partner with five microfinance institutions in India with a collective outreach of 480,000 clients.  They range from SHARE – which is the biggest with more than 300,000 clients (and targeting a million by 2008) – to Grameen Koota, which has about 14,000 clients and is fairly young. We support these organizations by providing them technical assistance and funding to expand their operations.

We’re involved in many innovative projects in India; the two most notable are:

* Grameen Capital India (GCI): This is an independent organization that we’re setting up in partnership with Citibank and ICICI Bank – two major banks in India. GCI will develop innovative financing deals that will provide funding to microfinance institutions to rapidly expand their operations. Lack of funding is the most critical hurdle that microfinance institutions face. GCI will work to reduce this hurdle to enable these institutions to serve millions of poor.

* The Village Computing Project: Our Grameen Technology Center initiative has set up a pilot project in Tamil Nadu where microfinance members receive loans to purchase computer equipment and set up a kiosk.  Kiosks are equipped with a computer, scanner, printer, and digital camera. They provide e-governance services, agricultural information, computer education and other critical information and services to their local communities.

Lip-sticking: For some time now, we’ve been touting blogging as a great charity and non-profit tool, locally. It looks like you’re catching the blog-bug. How did that come about?

Ken: Our first contact with blogs as an organization was when Fred Wilson  started Google AdSense advertising on his site and decided to send the proceeds to us. Since then, blogs have played a few different roles. First, as a research tool, keeping tabs on what people are saying about microfinance – I e-mail a monthly blog compilation to the staff to keep everybody informed.

Next, the blogosphere has been a great resource to explore new things. My background isn’t in marketing but I needed some ideas in that area, so this year I gave myself a “crash course” that included a healthy dose of blogs. For example, I found Seth Godin’s blog and then read some of his books; he generously provided a spot at one of his seminars to help generate ideas as well. 

This holiday season we decided to try placing some BlogAds. Hopefully it will be a more efficient way to reach new supporters than traditional offline approaches – and especially to expose people to a new idea and start conversations like we’re having right now.

Lip-sticking: In our conversation, you mentioned American businesswomen getting involved. Tell us about that…and how our readers can also participate.

Ken: Last year, a group of Dallas businesswomen formed an initiative to raise funds for our partner in Chiapas, Mexico’s poorest state. So far, they have brought in nearly $600,000 for that effort, well on their way to their $790,000 goal. We have another group in Miami that saw that and decided to raise funds for another partner; they’re just now getting started on their own fundraising project. [We hope you are seeing an important trend here, dear readers. Women helping Women. It's a concept Lip-sticking has been touting since we first began writing. Are you part of this growing movement?]

Next year, we will be upgrading our website to allow our supporters to run their own giving campaigns online, which will make it possible for more groups to join in. It’s a fun, collaborative way for people to interact and raise funds together – and it’s cost-effective, which is important to make sure that our donors’ contributions have the maximum possible impact on poverty. 

Lip-sticking: We noticed on your Web site that “The Honorable Tarja Halonen, President of the Republic of Finland, is the recipient of the 2004 Grameen Foundation USA-Deutsche Bank Humanitarian Award.” Can you tell us more about this award, and about the partners who work with you to bring your important message to the world?

Ken: Each year, we present three awards – a Humanitarian Award to an individual who has significantly impacted the lives of the world’s poor, and two microfinance practitioner awards. One of those goes to an established microfinance institution that has distinguished itself as an industry leader, while the other is presented to an up-and-coming, innovative organization.

This year’s ceremony was held in Berlin, at the headquarters of lead sponsor Deutsche Bank. The Humanitarian Award was presented to Finnish President Tarja Halonen, Finland’s first female head of state and a champion of empowering women and the poor.

Chandni: The awards program has been very successful and all past recipients have continued to provide outstanding services to the poor in their respective countries. The 2004 Award Winners were Al Amana, a microfinance institution based in Morocco, and Integrated Development Foundation (IDF), which serves remote populations in the hills of Bangladesh.

Lip-sticking: Ken, tell us about Viet Nam. As a flower-child, I remember the conflict well, but I’m woefully uninformed about today’s Viet Nam. Did being there prepare you for your role in the Grameen Foundation?

Ken: Today, Vietnam is still a poor country, but it’s developing rapidly.  Americans are greeted as friends, and in fact more than half the population was born after the war ended in 1975. On the fifth of my trips there (ranging from one to four months long), I married a lovely future CEO – just ask her! We lived in Da Nang for a year after, and well before our wedding we had been involved with a local street children’s home. I also got the opportunity to help build one of the first Habitat for Humanity homes in Vietnam, which was a great experience.

When we came back to spend some time in the US, I was interested in working with an international poverty-focused organization, and one day stumbled upon Grameen Foundation USA. I’m pleased to be helping connect a powerful solution with the now-familiar problem of poverty in developing nations.

Lip-sticking: Tell us about the Charity Navigator. We see Grameen is rated highly for organizational efficiency, capacity, and financial health. Do we thank you and Chandni for that, or someone else in the organization? It’s quite extraordinary to see such a young foundation doing so well, so quickly.

Chandni: The credit goes to all Grameen Foundation USA staff and supporters, past and present. Our staff is very dedicated to the cause of poverty alleviation, and we try to maximize the impact of our resources.

Ken: Charity Navigator is an independent rater providing objective analysis of non-profits’ financials. We’re pleased to have recently been added to their listings, with a 4-star rating, the highest possible. You can view key financial indicators in our profile; donors increasingly value transparency in the organizations they give to, so this is a great resource.

We’re growing quite rapidly, nearly doubling in size over the past two years. It’s estimated that only 10% of the world’s poor who need microfinance services currently have access to them, so we still have a lot of growing to do.

Lip-sticking: We usually ask a shopping question…so, what we’d like to ask, of both of you is: are there ways our readers can help by “shopping” at your Web site…what we mean is, can we donate online and if so, what other ways can we use our shopping dollars or time to further aid in your work?

Ken: Of course! We’re glad to accept donations online – with apologies for our slightly kludgy donation form, which we’re working to upgrade. In addition, you can use our website to tell your friends about microfinance, and sign up for our upcoming e-newsletter to keep track of what we’re up to. For the more technically-minded, we have an RSS feed of our latest news available, and hope to expand our RSS offerings in the future. Have a look at the link I've provided here!

Lip-sticking: Tell us what hopes you have for 2005, and how blogging might impact the future of what you’re doing.

Chandni: We have major hopes AND plans for 2005 and beyond. We have recently launched our 5-year strategic plan, which has ambitious goals of reaching 5 million new borrowers, ensuring that at least half of them escape poverty within five years, and championing new innovations.

Grameen Foundation USA is just completing a very successful first year of the strategic plan and hopes to make greater progress towards its goal in 2005. Among other things, we are expanding our programs in the Middle East and North Africa region as well as in Pakistan.Kenportrait2

Ken: Blogs are a great conversational medium, and I think that conversation in all its forms will be key to our future success. A form letter can’t teach what a circle of friends can. With the development of blogs, individuals now have the potential to have a greater voice than ever before, and can spread powerful ideas like microfinance through their conversations. We look forward to participating in more of those conversations.

Building conversation into collaboration is the next step. For example, the Omidyar Network, co-founded by eBay founder Pierre Omidyar and his wife Pam, is working to develop its own collaborative medium to help “more and more people discover their own power to make good things happen.” We’re proud to be among their partners, and as I mentioned earlier, we’re planning to implement collaborative tools of our own. 

Lip-sticking: May we check back in a few months to see how things are going?Chandniportrait2

Chandni: Absolutely – we’re involved in a variety of new initiatives and we’ll have some breakthroughs to share with you in a few months. Thanks for having us!

Ken: Chandni is off to India now, but I’ll stick around to answer any questions readers might have about anything we’ve discussed – thanks for reading and see you in the comments section.


This is one interview Lip-sticking is going to brazenly request you send to ALL of your friends, dear readers. We don't have to tell you why. We also encourage you to visit the Grameen Foundation USA at the various links here, and to send any questions to Ken and Chandni through our comments section. Watch for updates on this important charity in the months to come. Surely, supporting women in need is a win-win situation.

What's not to like about that?


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Wayne Hurlbert

What a wonderful interview about a tremendous organization. I am especially impressed with the micro-loan concept. Not only does the loan assist in starting a small revenue producing business, but empowers the women in so many other ways. The sense of achievement definitely is reflected in the many other aspects of the woman's life.

The enhanced feeling of personal accomplishment and recognition of one's ability to overcome life's obstacles is powerful. More such personally empowering organizations are needed everywhere.

Evelyn Rodriguez

Thanks so much Yvonne for this Grameen interview. Well done. Funny, I have been thinking about Grameen myself lately and blogged about it last week. I was very impressed that they contacted me via email immediately after my post was published and they asked if I needed any more information, etc.

I will definitely link to this article on my next post, and it's already on my del.icio.us bookmarks on my blog.

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