Microfinance club sponsors LA venture
Microfinance has gone from global to local. The club’s most recent lending partner, instead another anonymous global business, is a pair of Los Angeles entrepreneurs.
Co-founder and president of the Face of Microfinance, Pepperdine’s microfinance club, Rebecca Faulkner, explained microfinance as “basically providing opportunities in the form of a micro loan for people in poverty.”
To be eligible for the loan, the borrower has “got to be poor, got to be a good person, and got to be trustworthy,” Faulkner said.
The club supports entrepreneurs who have solid business plans but unsteady financial statements over a full year. This club has raised more than $10,000 in the past two years. Through websites that connect microfinance clubs and organizations to borrowers, such as the organization Kiva, Face of Microfinance quickly went international.
Businesses the club has previously helped were in places such as Argentina and Bangladesh. The relationships between the club and the entrepreneurs were never personal and could only be measured by the amount of money going back and forth. The plans from these foreign business owners were only known through resumes posted online.
The work with the LA borrowers, however, is much more personal. Not only does the club actually know where the business they work with comes from, but the club also gets to meet these entrepreneurs in person. Working with people so close to home also means the club gets to be more hands-on with the business plans.
The Face of Microfinance is no longer seen as just a bank in a country halfway around the world.
Professor of Finance Scott Miller, works with the Al J. Wooten Center, an after-school center for kids. The two entrepreneurs are from the Inglewood area and are affiliated with the center.
The club, along with its adviser, Miller, is paired up with the student leadership class to work together on the entrepreneurs’ business and financial plans. The student leadership class drew up a potential plan and presented the ideas to the entrepreneurs for their agreement. The entrepreneurs then came to campus, and the deal was sealed.
Students both in the leadership class and the microfinance club were able to see a business plan unfold into a successful, up-and-running business. The loan was set up so that every two weeks, the men are expected to return a part of the loan plus interest.
“Before it was very far away. This was a unique experience. We sat down with them and they told us all their ideas. It is cool to work with them every step of the way rather than them just being on the other side of a computer screen,” Faulkner said.
The next project the club is working on is a documentary about microfinance and how it’s working in Argentina. This documentary, “Banking On Trust,” will premiere on March 29 in Elkins. The club meets every two weeks in CCB 310 at 6:30 p.m.
Category: Payday loans