Tuesday, March 16, 2010


As some are aware, I have been dealing with some problems within my personal life that have limited my ability to write the next part in my series. I will be working on this through out the next week. With that in mind, I thought this would be a good time to add a thread for information pertaining to my first three articles and the subjects they cover. As such I will be posting relevant pieces within the comments section of this thread along with commentary as I feel it neccesary. I want to thank everyone who has offered support and prayers in what has been a trying season for my family and I.


  1. Smart cards and P D As to change the face of Indian Microfinance Sector

    Smart cards and P D As to change the face of Indian Microfinance Sector
    Business | April 3, 2009 | Share

    Perhaps the most amazing thing that happened to microfinance sector after Professor Mohd Younis won Noble Peace Prize was introduction of technology in this sector. All over the globe we see that new technologies are redefining financial services in innumerable ways. Even countries like Nigeria and other West African Nations have seen introduction of technologies in microfinance sector. Some institutes are already working with Automated Teller Machine networks, smart card operations and other computing technologies. It is unlikely that organizations that started in 1980’s would have imagined the use of such technologies.

    Need of automation

    Before we learn more about Smart Cards and the Personal Digital Assistant (PDA) lets learn about the need of automation in this sector. Almost all Microfinance Institutes are challenged to find a suitable way to serve low income clients in a most cost-effective way. Automating the operations would just lead to increase in cost in short run. The two most important reasons for automation are:

    Enhanced efficiency of the institute
    Satisfaction of the customer

    Automation can lead to efficiency improvements due to efficient systems and reduction in labour costs, which forms the largest expense in an MFI’s balance sheet. Technology can also accelerate service delivery and offer customers more flexibility and convenience. These improvements permit microfinance institutions to remain competitive in the industry. If implemented correctly, technology can be used to cut costs, expand outreach and provide better services.

    Use of PDA to Increase the efficiency of a loan officer

    PDA is a light weight hand held device. It looks like a tiny computer but performs other specific functions. The use of PDA gives the liberty to a loan officer who virtually brings the entire information system to the field near the clients. This reduces the burden of carrying papers and other sheets and subsequent entries to the information system of the organization.

    Advantages of PDA include:

    It support software that enables the loan officer to conduct quick meetings and collection from the clients
    Helps in collection of information, conducting loan analysis and disbursement of funds, therefore reducing the time taken for each activity.

    Reduction in chances of fraud and theft.

    However PDAs do not work in solitude. It has to be integrated with the management information system of the organization. Such integration allows loan officers to generate credit reports and other daily statements that directly from their PDA based software.
    Cost involved:

    An institute has to shed, on an average, USD 150 for this machine. Apart from this there are other charges for software development. This would come to around USD 200 per machine.


  2. cont.
    PDAs are currently being used extensively by Compartmos in Mexico where the loan officer brings customer information from the field. PDA is also used for doing credit analysis to make quick loan decisions.

    Use of Smart Cards

    A smart card looks like an ordinary credit and debit card. But unlike a credit card it has a microchip instead of magnetic strip. Such a microchip can hold information 800 times more then a magnetic strip and manages numerous personal information regarding different products taken by the clients (e.g. loan, savings, insurance). Smart card is even more secure then a credit card and the device get activated only by a retina scan or fingerprint. Smart cards are also enabled to hold and transfer currency. One important advantage of smart card is that it they can conduct transactions off-line. So no telephone lines are required to complete the transaction of money. All account information is stored in the chip.

    The main advantages of smart cards are:

    It is more secured then other cards and institutes can use it as an electronic passbook.
    Over the coming years the card would help in understanding the pattern that the consumer adopts in taking different products and as such would help the institute to innovate new products without any extra cost. For e.g. For example, if many customers use the smart card to buy products from a particular vendor, the MFI can form an alliance with the vendor in which customers get a discount on goods in exchange for the MFI’s promotion of the vendor. The vendor may even refer current customers to the MFI.
    Reduction in chances fraud and theft.
    Cost involved:

    The cost of the card would depend upon the features in contains. The least amount that an institute charges from clients is USD 3 per card.

    In India, SKS has been using the smart card with a slighter different version of PDA suited to guard information against rain and humidity. However the use has not been extended throughout the country by the organization.
    Smart card also works as an identification card of the client

    Whatever technology is used in this sector, the aim remains one, to extend service to poor and ultra poor is extreme areas of the country. Conversion from manual accounting to computerised accounting brought credibility in the eyes of the lenders who started to trust the Microfinance Institutes with the borrowed money.

    These latest technologies would help MFIs to work even more closely with the rural India and increase its outreach in a cost effective manner. One need to remember that MFI can only play a part in rural development only when it becomes profitable in itself.

    Implementation of technologies also involves cost and since its benefits are not achieved in short run most of the organizations try to avoid computerization and automation. However, if a microfinance institution has carefully implemented the project by conducting an analysis of current and future needs, a careful and methodical cost assessment, pilot tests, and suitable staff training and preparation, it is less likely to experience a money-losing venture in automation. Institutions that cut corners on analysis, testing, and training, are likely to make more profits in long run then they could have ever imagined without such automation.


  3. As part of the Earth Summit and the Earth Charter Initiative governments internationally adopted the Treaty on Alternative Economic Models. I will include the preamble below, but suggest reading this treaty in its entirety. Microcredit groups like Grameen, Kiva, Accion', as well as many other aspects of a cashless society have since been promoted under this treaty internationally.

    11. Treaty on Alternative Economic Models


    1. Today, the world is marked by an interrelated crisis of environment and development. This crisis is rooted in the dynamics of an economic model which is centered on the pursuit of profits rather than the promotion of the welfare of communities. This system assumes the consumption of infinite resources in a finite planet. This model of development is particularly manifested as follows:

    2. The free market/free trade model legitimizes an economic order in which unbelievable affluence is the privilege of a few and globalized poverty becomes the common condition of humanity. It has led to destructive consequences such as poverty, disease, the devastation of the environment and people's cultures, and spiritual misery.

    3. The social, cultural, political and economic injustices in the international system, support the elites of both North and the South, and widen the gaps among classes, races and sexes. 80% of the world's resources are consumed by 20% of the population and 80% of global environmental degradation is created by the same 20%. The disparity in wealth, power and resources is also increasing. The concentration of wealth within the richest 20% of the population has jumped from 70.2% in 1960 to 82.7% in 1989.

    4. The neo-liberal State uses its power and violence to enforce and expand this oppressive economic system under the coordination of the authoritarian Bretton Woods institutions, particularly the World Bank, International Monetary Fund (IMF) and the General Agreement on Tariffs and Trade (GATT), for the benefit of transnational corporations' growing monopoly and their control over the world resources. The Brundtland model of sustainable development will perpetuate this situation.

    5. Present expansions of the free-market/free trade ideology undermine the power of the States to formulate policies for the protection of natural resources and human livelihoods and transforms social relationships and eco-cultural and grassroots communities into mere economic variables.

    6. The patriarchal nature of the dominant industrial system has the effect of increasing the gap in power and income between men, on the one hand, and women and children on the other. For example, domestic work is not valued in the computation of Gross Domestic Product and data show a marked difference in the compensations of women and men for the same work done.

    7. We, the non-governmental organizations (NGOs) and social movements have drafted this treaty to define and establish alternatives to the dominant economic model and set forth the following principles, political commitment, action plan and follow-up mechanisms. In so doing, we declare our autonomy from both the market and the state.


    8. Our vision of the alternatives to the current economic model is grounded on the following principles:


  4. cont.
    9. The fundamental purpose of economic organization is to provide for the basic needs of a community, in terms of food, shelter, education, health, the enjoyment of culture, as opposed to a concentration on the generation of profit and on the growth of production for its own sake. Economic life must also be organized in such a way that it enhances rather than destroys the environment and safeguards natural resources for the use of future generations.

    10. An alternative to the current system must be based on indigenous, community-based, people-empowering models that are rooted in peoples' experiences, history and eco-cultural reality. This implies incorporating diversity of alternative production systems, decision-making processes and technologies, especially those drawn from indigenous peoples and peasant communities.

    11. An alternative economic model must recognize and institutionalize a central and equal role for women in shaping economic life.

    12. An alternative economic model should be based on the relative self-sufficiency of communities, regions and nations, rather than on free trade, the world market and large domestic and transnational corporations as the central institutions that determine production and distribution.

    13. Economic life must be informed by bottom-up development strategies, in which people and communities have the power to make economic decisions that affect their lives, in contrast with the dominant model which marginalizes grassroots communities and fosters international economic relations in which the center subjugates the periphery.

    14. One of the central ethical foundations of an alternative economic model is the interdependence of all peoples and the interdependence of peoples and communities and the non-human material world. This interdependence demands a system of sharing resources based on autonomy, equality, participatory democracy and solidarity. As members of a community, individuals must also take responsibility for living within the limits of the earth's resources, in contrast with the Northern model of excessive consumption.

    15. Human and economic development indicators should no longer exclusively or principally reflect material growth and technological advance but must take into account individual, social and environmental well-being. Such indicators would include health, gender equalities, unpaid family work, equalization in the distribution of income, better care of children and the maximization of human happiness with minimal use of resources and minimal generation of waste.


  5. 16. In an alternative economic system, the state will be transformed from being chiefly a facilitating agent of the present economic system that is dominated by domestic and transnational corporations, into a mechanism that genuinely represents and serves the people's will and promotes a strategy of relatively self-reliant, community-centered development.

    Political Commitment

    17. Based on the above strategic vision, we the under-signed representatives of NGOs and social movements at the NGO Forum of the June 1992 Global Forum, commit ourselves to:

    a. Return to and identify ourselves with our grassroots communities in order to realize community collective self-reliance and establish alternative community-based economic models.
    b. Build mutually empowering mechanisms and institutions to establish the alternative economic order.
    c. Participate in building a people's environment and development movement, starting from bio-regional networks' alliances to a global solidarity.
    Action Plan
    We will:

    18. Mobilize to counter and make democratically accountable the operations of the Bretton Woods institutions and the so-called "economic development models" dominated by transnational corporations. This includes the Brundtland model of sustainable development.

    19. Work to eliminate existing international debt and to dismantle the unjust system that perpetuates international debt creation.

    20. Reject the transfer of outdated technology and industrial complexes, as well as agricultural export projects which entail high environment and social costs. We demand the payment of the environmental debt which the rich countries have incurred with the poor countries. This payment will ensure that all society benefits from clean, environmentally sound technologies, to support ecological industrial transition policies for both the north and south, readdressing the existing industrial economic model.

    21. Pressure our governments to restructure and redirect the GATT to work toward creating a global trading system that is fair and serves the interests of all people, as well as promoting local self reliance and community-based enterprises.

    22. Mobilize for the reduction of military budgets in all countries, and for the abolition of the international sale of military weapons, and to transfer these budgetary resources into socially and environmentally appropriate purposes in both the North and the South.

    23. Work to establish a carbon emission tax in all nations where the average emission is one ton or more per person and apply the tax revenues to a fund for the development of alternative technologies to be shared worldwide.

    24. Mobilize for drastic reductions in energy consumption and excessive consumer lifestyles, while encouraging local-regional maintenance economies, centered on sufficiency and frugality.


  6. cont.
    25. Work to develop new socio-economic relationships that are non-exploitative and that regenerate cooperative customs which protect communities and their environments. These customs and institutions will be supported by the mobilization of voluntary exchange programs at all levels.

    26. Work to develop alliances that build and strengthen solidarity with and among workers (e.g. for better salaries and working conditions), urban poor (e.g. for drinking water and sewage facilities), rural laborers (e.g. land reform), women (e.g. equity and political participation) and indigenous communities which are threatened with displacement.

    27. Work in our respective communities to advocate for a development fund for the South in which Southern nations and people play a central role.

    28. Mobilize to make transparent all information about development projects and decision making processes that select and evaluate technologies.

    Follow-up Mechanisms

    29. The NGOs and Social Movements will organize in a decentralized, horizontal and democratic way at all levels: local, national, regional and international, where coordination should develop in the context of actions.

    30. Although the alternative models will be autonomous and self regulating at all levels, networking structures as suggested below are imperative to insure accountability and transformative impact and coordination with other treaty networks.

    31. Because the Alternative Economic Models Treaty process incorporates the alternative development model, it is important that the treaty be given a central place in the entire Global Forum alternative treaties follow-up process.

    32. The follow-up process for alternative economic models will be an open and porous networking which will:

    a. identify innovative experiences of developing alternative economic models, networks and networks of networks
    b. convene, in cooperation with these existing networks, working groups that pursue alternative experiential and theoretical models that can be diffused to and evaluated by community based groups
    c. sponsor, in cooperation with any interested group, national, regional and international forums, which promote, refine and actualize the Alternative Economic Models Treaty.
    33. In order to continuously represent the evolving alternative economic model treaty process at the international inter-treaty level, we need to develop mechanisms that keep this model before all of the other treaties. We therefore propose as a possible governance mechanism that:
    a. each treaty team will designate six representatives - one for each of the following regions: America Latina, Africa, Asia, North America, Europe and Australia and Pacific Isles - to a new NGO and Social Movements Assembly
    b. this assembly will elect from its membership an international coordinating committee, with representation from all regions
    c. a parallel interlocking network structure will be established at all levels


  7. NGO Documents on Indicators of Sustainable Development

    NGO Documents for the Earth Summit, 1992

    Non-Governmental Organization Alternative Treaties at the '92 Global Forum

    Treaty 11. Treaty on Alternative Economic Models

    15. Human and economic development indicators should no longer exclusively or principally reflect material growth and technological advance but must take into account individual, social and environmental well-being. Such indicators would include health, gender equalities, unpaid family work, equalization in the distribution of income, better care of children and the maximization of human happiness with minimal use of resources and minimal generation of waste.


    NGO Documents for the Earth Summit, 1992

    Non-Governmental Organization Alternative Treaties at the '92 Global Forum

    Treaty 17. Treaty on Consumption and Lifestyle

    25. Develop new concepts of wealth and associated indicators of development for individuals, communities and nations which support new models of socio-economic and human development which are equitable, environmentally sustainable and which recognize the full range of human aspirations


  8. Everyone remembers the role that Fannie May played in the current economic collapse. This piece may give an indicator as to why.

    Replicating Microfinance in the United States
    Edited by James H. Carr and Zhong Yi Tong

    Microfinance was pioneered in the developing world as the lending of small amounts of money to entrepreneurs who lacked the kinds of credentials and collateral demanded by banks. Similar practices spread from the developing to the developed world, reversing the usual direction of innovation, and today several hundred microfinance institutions are operating in the United States.

    Replicating Microfinance in the United States reviews experiences in both developing and industrialized countries and extends the applications of microlending beyond enterprise to consumer finance, housing finance, and community development finance.

    This book reviews experiences in both developing and industrial countries and extends the applications of microlending beyond enterprise to consumer finance, housing finance, and community development finance, concentrating especially on previously underserved households and their communities.

    Replicating Microfinance in the United States is based on papers commissioned by the Fannie Mae Foundation and findings from an October 2001 conference jointly held by the Fannie Mae Foundation and Woodrow Wilson International Center for Scholars in Washington, D.C.

    Contributors include Nitin Bhatt, Robert M. Buckley, Bruce Ferguson, Elinor Haider, Chi-kan Richard Hung, Sally R. Merrill, Jonathan Morduch, Gary Painter, Sohini Sarkar, Mark Schreiner, Lisa Servon, Ayşe Can Talen, Shui-Yan Tang, Kenneth Temkin, Andrés Vinelli, J. D. Von Pischke and Marc A. Weiss


  9. Is Microfinance Destined to be the next Subprime Mortgage Mess ...
    File Format: PDF/Adobe Acrobat - Quick View
    another subprime mortgage debacle in the microfinance sector. ...
    consumer to Wall Street, bypassing FHA, Freddie Mac, and Fannie Mae –
    the traditional ...


    CHF's Microfinance Expertise | CHF International
    Prior to joining CHF, Ms. Sarkar spent over five-years as program lead
    for the Fannie Mae Foundation's microfinance initiatives. ...
    www.chfinternational.org/node/21178 -

    The Importance of Microfinance - James H. Carr - Microenterprise ...
    File Format: PDF/Adobe Acrobat - Quick View
    The Importance of Microfinance to the U.S. Economy. James H. Carr.
    Senior Vice President. Fannie Mae Foundation. Presented to the Federal
    Reserve Bank ...
    Microenterprise Development Programs in the United States and in ...
    by M Schreiner - 2003 - Cited by 48 - Related articles
    In: J. Carr and Z.-Y. Tong, Editors, Replicating microfinance in the
    United States, Fannie Mae Foundation, Washington, DC (2001), pp.
    191–222. ...

    These pieces explore the role of Fannie and Freddie in changing the economic structure of the United States. As can be witnessed all is relative in this chaotic world.

  10. Nobel Peace Prize winner Muhammad Yunus on micro credit’s long shadow


    From changeobserver, a site promoting social ideals that are New Age at their core. This site could easily be described as internet promotion of the SPIN model.


    Muhamed Yunus to be awarded 2009 Presidential Medal of Freedom


    From Third Age, need I say more.

    Boosting a Business With a Microloan
    Posted January 27, 2010 12:55 AM
    Posted in entrepreneur, microloan, Muhammad Yunus. kiva.org
    By Dan Weil, Bankrate.com
    A microloan, typically an advance of under $100 made to an entrepreneur in an impoverished area, has become a more popular way in recent years for people to give, and received a big boost when microlending pioneer Muhammad Yunus won the Nobel Peace Prize in 2006.

    Investors and donors had committed a total of $14.8 billion to microlending as of December 2008, according to research organization CGAP, which is housed at the World Bank in Washington, D.C.

    Different ways to microlend
    There are a variety of ways for individuals to support microlending, through either microloans or donations. You can lend through Web sites including Kiva.org and MicroPlace.org, which is owned by eBay. Or you can donate to organizations that support microlenders, such as Grameen Foundation and ACCION International.


  11. From Global Envision:

    The Online Funding Revolution

    When Muhammad Yunus, founder of Grameen Bank, which revolutionised credit for the poor, won the 2006 Nobel Peace Prize, microfinance became a household concept. Now, online lending sites such as Kiva and NamasteDirect give everyone a chance to help fight global poverty and, in the words of one new investor, "teach people how to take a small investment, grow their business and eventually become self-sufficient."

    Kiva offers investment options that appear to revolutionise the interface between giver and receiver, lender and client. According to Jonathan Morduch, co-author of The Economics of Microfinance, "Kiva and the microfinance world are set up not just as a better way to fight banking but also an important way to rethink traditional modes of giving and global social justice."

    The founders of Kiva are bullishly promoting their new approach while experienced microfinancing institutions (MFI) remain cautious in their assessment and others critical. Nevertheless Yunus's prize and the arrival of online lending have prompted debate about the virtues of online microfinancing as well as the virtues of microfinance per se in addressing poverty.

    Kiva's lead has been followed by others. Internet giant eBay completed a complex regulatory process to launch the online microfinance service, MicroPlace on 24 October. MicroPlace differs from Kiva in that lenders are purchasing securities - investing in MFIs, not making loans to individuals - and are paid interest.

    Attacking Poverty through Loans

    One of the biggest challenges for the poor is gaining access to capital and formal financial institutions. According to the UN, about one billion people still live on less than a dollar a day - a poverty trap that is virtually impossible to escape. But in the past two decades, micro-credit has become accepted as a potentially successful development tool.

    "One of the great aspects of microfinance is that it smoothes the financial lives of the poor when they face sudden outgoings as a result of some catastrophe, disaster or just an expensive wedding."
    Now the microfinance sector is in the middle of a boom: "Microfinance will grow more and more," claims Nairobi-based director of Inclusive Financial Systems, Stephan Staschen. "More commercial entities will also get involved as they realise its profitability and the result will be that many poor people will be served." Micro-credit programmes extend small loans to the very poor, previously viewed as bad-credit risks, through rotating savings and credit circles, which take deposits and give loans at certain intervals and in strict amounts.


  12. cont.

    Such loans allow people to invest in the material, livestock, skills or machinery they need to generate income as well as pay for emergency needs such as medical expenses or death and marriage costs. "One of the great aspects of microfinance is that it smoothes the financial lives of the poor when they face sudden outgoings as a result of some catastrophe, disaster or just an expensive wedding," says Staschen. Although the definition of small loans varies, most are less than 200 USD.

    Most micro-loan programmes focus on women. Experience has shown that women are a good credit risk and invest their income in the wellbeing of their families. "Now 96 percent of our four million borrowers in Grameen Bank are women," said Yunus in 2004. Grameen was founded in 1976; by 2005, it had the equivalent of 678.28 million USD in total assets with 5.05 million active borrowers.

    The Consultative Group to Assist the Poor (CGAP) is a consortium of 31 public and private development agencies working to expand access to microfinance. In June 2004 they agreed 10 key guiding principles emphasising that MFI's core aim is to fight poverty by creating transparent, sustainable and lasting private financial services that should be rolled out to the largest number of low-income clients.

    "Loans that Change Lives"

    Kiva.org was co-founded in 2005 by Matt and Jessica Flannery as the "world's first and only online micro-lending opportunity", teaming up with international organisations working in low-income communities. It lists 61 partners in 37 countries that are responsible for deciding which borrowers will be posted on the website. The loans are disbursed to the partners - local MFIs - for ultimate disbursement to the borrowers.

    While browsing through the site, a potential lender sees brief descriptions of the borrowers, making it easier to create a connection with one or more entrepreneurs. By using the internet, Kiva claims to have reduced costs. "To date, our biggest growth restriction has been partnering fast enough to keep up with the growing demand by lenders to place more loans."

    It appears that many "ordinary" people are choosing this route, perhaps over more traditional methods of donating money. As of 13 November 2007, Kiva.org had raised 14 million USD from 142,000 people to fund 20,769 loans - and the count changes daily. That represents a sizeable amount of cash from a large number of people who, more likely than not, did not previously know about microfinance or MFIs.

    But with the support that Kiva.org has received from high-profile supporters such as former President Bill Clinton - who featured it in his new book, Giving: How Each of Us Can Change the World - Kiva will continue to serve as a conduit for those wanting to reach the poor.

    "Our biggest challenge has been keeping up with our growth," says Fiona Ramsey, Kiva's public relations director. "To date, our biggest growth restriction has been partnering fast enough to keep up with the growing demand by lenders to place more loans. We have been managing this challenge by expanding our partnerships team and bringing on microfinance experts."
    more at link


  13. More from Global Envision:

    Microfinance Part of a Bigger Picture

    Microloans" are all the rage these days, as more people embrace the theory that small loans to the poor can stamp out poverty everywhere.

    But even one of the main proponents of microfinance — the founder of the Internet microloan site Kiva — told the Council on Foreign Relations that microfinance is "just one factor" in economic growth:

    So my conclusion at this point is that microfinance is weakly associated with macroeconomic growth. It’s just one factor; it’s not necessarily going to cause a country’s GDP [gross domestic product] to increase. It has to be accompanied by things like good governance, infrastructure, transparency in economics, and all sorts of other things that microfinance cannot in and of itself to bring about.
    Flannery also points out that loans of $50 or $100 cannot build roads or schools. Microfinance certainly has its place, but Flannery provides a nice reminder that it's not a cure-all.


  14. There is ACORN involvement!!!!! ACORN IS AN INTERNATIONAL
    ORGANIZATION. I believe the overseas branch Acorn International
    L.L.C. is headed up by Wade Rathke's brother Dale. Dale was shipped
    over to ACORN International after embezzling $948,607.50 from the
    group and affiliated charitable organizations back in 1999 and 2000.(
    according to The New York Times report on July 9, 2008 ).

    Welcome to the Acorn Initiative!
    The Acorn Initiative is a 501(c)3 organization supporting individuals
    and ... We will seek opportunites primarily in education and
    microfinance as we ...

    Beginning in 2009, Acorn will donate funds to borrowers worldwide
    through known microfinance organizations, the Grameen Bank/Foundation
    and Kiva.com. ...

    Looks like they have a bank in Nigeria. Surprise, surpirse. LOL

    Central Bank of Nigeria:: Micro-Finance Banks
    14, Acorn Microfinance Bank Limited ... 35, Ahmadu Bello University
    Microfinance Bank Limited ... 92, Associated Investment Trust
    Microfinance Bank Limi ...

    Top Banks in the World. Banks Ranking. What is the best bank ...
    Acorn Microfinance Bank Limited, 3. ↑. ↓. 2183. ACR Retakaful SEA
    Berhad, 3 ... Acuity Microfinance Bank Limited, 3. ↑. ↓. 2191. Ada
    Rural Bank Ltd, 3 ...

    Welcome to the Acorn Initiative!
    ... Goals by offering poverty-stricken regions of the world a HandUp
    through education, health, and microfinance. ... All Rights Reserved.
    Acorn Initiative.

  15. JD,
    Firstly, you and your family remain in my prayers in your difficult times. This update is excellant, and I might say exhaustive to read, let alone research and write, keep up the fantastic work.After reading through your post (and reading between the lines) it occurs to me that the bottom line for them is "Old Tech" Elite are out and we "New Tech" Elite are in...."Trust us...". Both camps are equity stripping the human soul and devaluating human beings, hi tech just makes it more effective. To God every human soul is so valuable that He gave His uniquely born Son to redeem each and every one at Calvary, a stark contrast to the "value" the "compassonate" elite's view. Let us hope as more read your work that it becomes clearer to more people what that clear distinction is. Very, very fine work JD.


  16. Sustainable Development and the World Summit for Social ... (PDF)
    The Treaty on Alternative Economic Models that observes. that the disparities in wealth, ... demonstrated by the relative successes of the Grameen Bank in ...

    www.iisd.org/pdf/wssd.pdf - 154k

  17. Remedies to Global Crisis: "Allopathic" or "Homeopathic"?
    Metaphorical complementarity of "conventional" and "alternative" models

    Prepared on the occasion of World Homeopathy Awareness Week (April 2009)
    and the publication of the Global Financial Stability Report of the International Monetary Fund


    This is a very long, very indepth, very influential, very New Age study prepared for key institutions in our world. A MUST READ!!!!

  18. HK,

    Thank you very much. I thought this update was a neccesity for those still not seeing the bigger picture. I am still barely scratching the surface, and yet you are right it is exhaustive to read! I will be adding more over the next week or so, so check back frequently. Your prayers are very much appreciated and needed! I feel like I am in the cross hairs of the enemy, which I guess puts me on the right side of life!

  19. A pretty slick "plan", eh?

    Out with the old, in with the new. But first you have to denigrate, collapse and destroy the old. JD, everything you have posted so far about RFID, Earth Summit, Global Envision, resource control, the entire sustainable green agenda, even the micro-fincance stuff, fits in nicely with what a certain man of Indian descent living in San Fransisco has been preaching. The fact that one man can hold ALL these concepts in his head and communicate them in a way "common" people can understand and be led to accept, well, that takes a special talent.

    Yes, I know, he adamantly denies he is "the messiah". Of that, I am in total agreement.



  20. omots,

    Very slick indeed! The sad part is they have hornswoggled the people into thinking the chains of slavery are truly charities. Reminds me of Huxley. That Patel is capable of promoting these principles in common language is interesting indeed. I like many am watching as events unfold, reserving judgement until I can state my piece with absolute certainty. I do agree though, he is certainly not the Messiah.

  21. Grameen Healthcare
    Extending the Success of the Principles of Microcredit to Health Care Delivery

    Mission and Overview

    The Grameen Bank and other microcredit programs have proven that bottoms-up business models can enable the poor to lift themselves from poverty and are sustainable. The 2006 Nobel Peace Prize recognized the impact microcredit has had--and will continue to have--in enabling millions of families around the world to break the cycle of poverty once and for all. Many of the families of Grameen borrowers have gone from illiterate and poor to educated professionals in a single generation.

    In establishing Grameen Healthcare (GH), Grameen aims to extend the success microcredit to health care. The mission of GH is to establish sustainable best practices in a broad range of health care services for a broad market for the entire population but focusing on the poor and poorest.

    GH will enable the poor to be self sufficient in addressing their health care needs such that they can accept but not require outside assistance. This mission will be developed in a number of ways that complement one another:

    GH will design and develop a bottoms up health care infrastructure that can take lessons from successful efforts around the world and improve upon them to deliver the highest quality health care, in an efficient and sustainable manner, primarily to the poorest of the poor
    To achieve these goals, GH will build on the network of existing Grameen Clinics which are already providing primary healthcare at the village level in various locations of Bangladesh.
    What Grameen does now: Grameen Kalyan, Grameen Healthcare Services, Grameen Healthcare Trust

    GB began a health program in 1993 to provide care for Grameen borrowers and the rural poor in Bangladesh. The goal is to provide quality health services with qualified medical personnel at an affordable cost.

    An infrastructure was established that has grown to 51 Grameen Clinics (GCs) that include a pathological laboratory and pharmacy, and satellite camps along with community health outreach, and emergency services. Grameen Kalyan is implementing these health clinics.

    The GCs are led and managed by a licensed physician, who is assisted by one or two paramedics, a laboratory technician and six community health assistants. This network currently operates with 93% cost recovery.

    The GCs typically serve a population of 50,000 persons living within 8-10 kilometers of the clinic.


  22. cont.

    In 2001, GB established the Prevention of Cataract Blindness Project, which has now become the Grameen Eye Care Hospital in Bogra as a social business. A second Eye Care Hospital has now been built in Barisal, in southern Bangladesh which will begin operation in April 2009.

    A vital component of these health programs is the accompanying micro-health insurance scheme to encourage positive health seeking practices. This serves a dual purpose of enhancing utilization of health services and improvng cost-recovery to achieve sustainability. An integral part of the Grameen approach is the “sixteen decisions” which guide all GB borrowers and their families toward productive living. Indeed, more than half of these 16 decisions directly address the health and well being of borrowers and their families. Thus, the basic principles of learning organizations and an overall vision to support the well-being of the poor have been pillars of the Grameen approach.

    While initial evaluations of the GC network and its health impact are positive, continuous improvements in coverage, disease prevention, quality of care and sustainability remain as top priorities. Moreover, it is critical to identify and strengthen processes underpinning the success of this model, and promote the key principles of social entrepreneurship for health to create a sustainable and replicable model that will expand throughout Bangladesh and to other countries.

    Grameen Healthcare will continue to expand, strengthen and upgrade the network of Grameen clinics with the aim of transforming them into Grameen Health Management Centers with a focus on awareness, prevention, diagnosis and early detection.

    The following key elements form a foundation on which to build:

    An integrated health network which would include a hospital centre “hub” including a medical college and a teaching hospital, one or more nursing colleges, and a network of primary and specialist clinics such as a Mother and Child Clinic. These will provide care in a variety of critical focused areas and, as an extension of the primary and specialist clinics, rural clinics (both locally fixed and mobile) will bring health care to the doorsteps of patients. These clinics will be modular so that they can be built step by step once sustainability has been proven. All tiers of the healthcare system will be linked and facilitated by information and communications technology.
    Grameen plans to convert the Grameen Clinics into Grameen Health Management Centers which are focused not only on treatment but which become centers which focus on awareness, prevention, diagnosis and early detection rather than just treatment which is inevitably costlier especially for low income families. The Grameen Clinics will target all families in the area not only Grameen members. Its main focus will be children, adolescent girls and mothers. A primary goal of the Grameen Health Management Centers will be to dramatically reduce infant and maternal mortality rates in the catchment areas.
    Grameen Healthcare is working with world class diagnostic companies to develop simple customized hand held diagnostic equipment designed for easily diagnosis of breast lumps and pregnancy related problems.
    Within the Grameen Healthcare system, young women within the villages will be encouraged to become entrepreneurs who will go house-to-house and operate and sell the use of this equipment for the detection of lumps in the breast, incorrect positioning of foetus and other problems which can be detected with simple imaging device.


  23. cont.

    These young women will operate a self sustaining business of their own based on this equipment but will be linked closely to the Grameen Health Management Centers for referral purposes, which in turn will be linked to specialist doctors at the city level.

    An information architecture, including electronic medical records, telemedicine, decision support, and other IT tools for physicians, nurses, technicians, other health professionals, and patients at the point of care. This information architecture will feed into existing public health education programs, including formal health training and informal education opportunities designed like the regular weekly meetings between microfinance banks like Grameen and their borrowers. Several partner organizations are currently working with Grameen to upgrade the capabilities of the Grameen clinics including development of patient data system of Grameen clinics.
    A bottoms-up focus on understanding and meeting the health care and research needs of the poor as reported by the poor themselves and their local health providers. GH will focus on the needs of the poor, and their needs and solutions will probably be different from those in the developed world. They will, though, be of benefit to the developed world as well. User-generated content from disease-specific and other patient associations will help to gather and prioritize key needs and disseminate best practices.
    Everyone will pay something for their care at the point of service, but no one will be turned away because of inability to pay. Payment at the point of service is important because it establishes the value and sustainability of the service and affirms the rights and self-respect of patients and providers. Those who are unable to pay will be asked to promise some payment at a future date, but no one will be turned away. There will be tiered pay schemes, for several levels of income.
    Integrated Health Network

    A new Grameen medical college and hospital in Bangladesh will be an important focal point of the project. This medical college and teaching hospital will be developed into one of the most advanced in the country, treating patients from all strata of society with the best methods possible. Additionally, a strong research and training component will be part of the medical and teaching hospital system.

    Grameen is in the process of securing a large piece of land to build the medical college and hospital and associated institutes. It is negotiating with several world class hospitals to collaborate on the set up of the Grameen medical college and hospital.

    The Mother and Child Health Care Institute will be focussed exclusively on mothers and their children up to the age of 5. Services offered include pre-natal care, maternal and pediatrics. The Institute will also deal with anemia and malnutrition in children and ensure that the children receive the appropriate vaccines within the right period of time. Where home visits are not possible, E-Health and local Grameen Healthcare Management centres will ensure continued care of mother and child. The Grameen Healthcare system as a whole will be focused on the care of children, adolescent girls and mothers.

    Nursing Colleges will be another way to train and empower young women in rural areas, especially those who are daughters of Grameen borrower families. Currently Grameen Healthcare is planning on establishing two nursing colleges are being planned, one in Dhaka and one in Chittagong. Grameen Bank will offer education loans to young women to train at the nursing colleges. The colleges will provide both BSc and diploma courses in nursing. Once they are trained and qualified the nurses would enter both local and international market for nursing professionals. With their income they will repay their education loans and contribute to the local and national economy through remittances to their families.

  24. cont.

    The hospitals and clinics will collaborate closely on relevant areas of research with research institutions worldwide.

    A technician college will be established as a part of this project which will maintain medical equipment belonging to the Grameen medical system but also beyond.

    Information Technology Architecture

    GH will identify and expand best technology practices for sustainable health care delivery in developing countries, including the establishment of biobanks; cell-phone- and Internet-based treatment, decision support, and outcomes reporting; and the introduction of electronic medical records.

    Grameen Healthcare plans to build on the country wide mobile phone network to transmit critical medical information from remote locations to the medical centers in the towns and cities and work to fulfill the immense potential of e-healthcare in the country.

    By addressing information technology issues now, as the health care network is being established, GH will be able to institute an advanced electronic network that will make it much easier for health care professionals to share information and deliver better care. This health database centre will also greatly accelerate research. GH can and will design and deliver sustainable world-class technical capabilities and education to remote areas and will link to more centralized hospital and lab facilities necessary for the more specialized services to be cost-effective.

    Health-related social businessese

    Grameen is collaborating with multinational companies like Danone, Veolia and BASF to bring health related social businesses to the poor of Bangladesh.

    Grameen Danone and BASF Grameen address malnutrion among the rural population through the production and sale and fortified yogurt in the case of the former, and multiple micronutrient sachets in the case of the latter which address deficiencies in the diet especially among children and pregnant/lactating mothers.

    In addition, BASF Grameen will produce and sell long lasting treated mosquito nets to combat mosquito borne diseases such as malaria and dengue in Bangladesh.

    Grameen Veolia has developed a social business to bring clean drinking water to rural population in arsenic contaminated areas of Bangladesh. The first water treatment plant is in operation, and many more are planned across Bangladesh.

    Many more such social business collaborations which bring health benefits for rural population are being developed.

    Structure and Governance

    GH will be a social business which will draw upon the experience and advice of an advisory board, a network of subject matter experts, and partners at institutions worldwide.

    An important part of the governance will be the advisory board, which will include leaders from Bangladesh as well as other global leaders from highly ethical and patient-oriented organizations to ensure that the social goals are being met and the interests of the patients are respected.


  25. GS1 Healthcare reference book 2009/2010

    GS1 Standards in healthcare:
    raising the bar on patient safety and
    supply chain efficiency

    Patient safety, supply chain security, traceability and efficiency in
    Healthcare are currently at the forefront of government regulatory and
    industry concerns around the world. As a result, numerous, and often
    incompatible solutions are being (or have been) proposed to the national
    and international supply chain stakeholders and, in some cases, adopted
    in preference to global standards. The cost of diverse government
    regulations, proprietary services and incompatible solutions being offered
    to stakeholders has made it clear that there is a need to define and increase
    adoption of open, global standards. This is the mission of GS1 Healthcare.


    A lengthy read, but worth it. Goes a long way in explaining what we are seeing unfold in the United States healthcare debate.

  26. GS1 EPC Global

    What is EPCglobal?

    EPCglobal is leading the development of industry-driven standards for the Electronic Product Code™ (EPC) to support the use of Radio Frequency Identification (RFID) in today’s fast-moving, information rich, trading networks.
    We are a subscriber-driven organisation comprised of industry leaders and organisations focused on creating global standards for the EPCglobal Network™.

    Our goal is increased visibility and efficiency throughout the supply chain and higher quality information flow between companies and their key trading partners.

    What can we do for you?

    EPCglobal provides the following services to companies wishing to improve their supply chain management efficiency:

    Assignment, maintenance and registration of EPC Manager Numbers
    Participation in development of EPCglobal Standards via EPCglobal’s Action & Working Groups
    Access to the EPCglobal Standards, research and specifications
    Opportunity to influence the future direction of research by the Auto-ID Labs
    Access to the results of the EPCglobal Certification and Accreditation Program testing
    Links with other subscribers to create pilots and test cases
    Training and education on implementing and using EPC technology and the EPCglobal Network™ through more than 101 global agents


    EPC Global supplies RFID tags for the Department of Defense


    More from EPC Global


  27. You gotta love somebody who goes by the name "cryptohippie".

    Here's a ranking of countries based on "electronic police state" criteria.


    Supplemental pdf on the "taking of the internet":


  28. I just realized the link for the Treaty on Consumption and Lifestyle is broken. I am going to post the treaty as well as a new link.

    Treaty on Consumption and Lifestyle


    1. This treaty is meant to promote reflection and debate among social movements and non-government organizations (NGOs) leading to commitments for action within different local and regional contexts.


    2. The most serious global environment and development problems facing the world arise from a world economic order characterized by ever expanding consumption and production, which exhausts and contaminates our natural resources and creates and perpetuates gross inequalities between and within nations. We can no longer tolerate a situation which has brought us beyond the limits of the earth's carrying capacity and where twenty percent of the people consume eighty percent of the world's resources. We must act to balance ecological sustainability with equity between and within countries. It will be necessary to develop new cultural and ethical values, transform economic structures and reorient our lifestyles.


    3. Consumption and production patterns which are equitable and ecologically sustainable are consistent with six basic principles which apply to consumers and producers.


    4. We must reawaken to the reality that quality of life is based on the development of human relationships, creativity, cultural and artistic expression, spirituality, reverence for the natural world and celebration of life, and is not dependent upon increased consumption of non-basic material goods.


    5. The economic system should be restructured away from production and consumption of non-basic goods for a few to focus on production of goods to meet basic human needs (e.g. water, food, clothing, shelter, education, health care) for all persons.

    6. Macro-economic systems should be restructured to include ecological and social costs in the prices for all goods and services, including work in the unpaid and informal sector.

    7. Local communities must have full participation in the control and decision-making power over the management of the use of natural resources on which their economy depends to assure that these resources are used and consumed in an equitable and environmentally sustainable way.

    8. Continuation of the current economic order carries with it the threat of serious or irreversible environmental damage and associated social disruption. Therefore, lack of full scientific certainty regarding potential impacts of conversion should not be used as a reason to avoid immediate action.

    9. Because the industrialized countries consume the vast proportion of the world's natural resources and create the majority of the global pollution, they must bear the primary responsibility for restoring the natural environment and compensating the victims of environmental degradation.


  29. cont.


    10. The concept of environmental space, whereby all people have the right to equitable shares of water, food, air, land and other resources within the carrying capacity of the earth, should be the basis for equitable production and consumption.

    11. While overall population growth is a danger to the health of the planet, it must be recognized that population growth in the North, due to extremely high levels of per capita consumption, is a far greater immediate environmental threat than population growth in the South. Meeting basic needs is a prerequisite for stabilizing population growth.


    12. Overall consumption and production must be eased back to fit within the regenerative carrying capacity of the earth. Given the ecological and development crisis, this transition must be completed within a few decades in order to avoid irreversible damage to life on earth.

    13. The use of energy, especially fossil fuels, must be reduced significantly. Renewable sources which are less environmentally damaging should be promoted.

    14. Due to their destructive social and environmental impacts, production and use of military goods and weapons are not an acceptable part of an equitable and environmentally sustainable society.

    15. Production and consumption of products with built-in obsolescence should be stopped; consumption of products which are transported over long distances should be reduced; and production processes which create toxic, hazardous, or radioactive wastes should be halted.

    16. Reduction in consumption should have priority over reuse or recycling of products.


    17. Goods should be produced in closed cycles, whereby substances are continually reused to the greatest extent.

    18. Goods should be produced to have the least impact on the environment, with long durability, high efficiency and simple repairability.

    19. After reduction, reuse of goods should have priority over recycling.


    20. Industries and government must take full responsibility for proper treatment throughout the life cycle of the production process. If there are waste products, they should be treated where they are produced and not transported across national boundaries.

    21. Local decentralized recycling units should be a priority over large-scale centralized recycling units due to their greater employment creation and lower use in general of energy and transport.

    22. Incineration of waste should not be considered as an alternative to recycling.

    Action Plan. We, the undersigned, commit ourselves to the following actions:


  30. cont


    23. Conduct, first, a self-assessment of our own lifestyle choices in light of the elements of this treaty and make personal commitments towards change

    24. Participate with business and industry, government, academia, voluntary and community organizations, political groups and other personal affiliations to examine jointly the ways we can improve our consumption and production patterns to meet basic human needs around the world

    25. Develop new concepts of wealth and associated indicators of development for individuals, communities and nations which support new models of socio-economic and human development which are equitable, environmentally sustainable and which recognize the full range of human aspirations

    26. Create awareness and set an example in our organizations and the community of more balanced working environments which strengthen a sense of community, encourage human creativity and depth in personal relationships and meet the physical, mental and spiritual needs of people

    27. Recognize the things in life which truly bring joy and satisfaction. Notice, appreciate and care for the relationships that sustain us, whether with our fellow human beings or with the natural world of which we are a part, and spend time enjoying and enlivening them

    28. Commit ourselves to learn from communities which live in sustainable ways utilizing appropriate technologies

    29. Analyze resistance to change from within consumer societies and find ways to motivate people to accept new values and behavior.


  31. cont.

    Restructure and Redistribute

    30. Influence international and national fiscal, monetary and trade policies to include: integration of social and environmental costs into product prices, fair trade, land redistribution, debt alleviation, equitable tax systems, regulation of transnational corporations, an end to structural adjustment policies and changes in other structural forces which negatively impact equitable and environmentally sustainable production and consumption patterns

    31. Promote conversion to an equitable and ecologically sustainable economy, and take responsibility for the needs of those whose livelihoods are negatively affected. Strengthen local and regional economies as the basis for community self-reliance in meeting basic needs for all people and research and promote alternative investment and employment opportunities to assist those who are displaced when unsustainable industries are halted

    32. Support and participate in initiatives such as alternative trade markets, networks and cooperatives with environmentally and socially responsible services and products. Encourage local and regional consumer-producer networks such as community supported agriculture (CSA). Especially encourage linking Northern consumers with Southern producers to ensure fair payment and support environmentally sustainable production in the South

    33. Establish and publish a set of criteria for socially just and environmentally sustainable consuming and investing, appropriate to different regions

    34. Participate in the creation and monitoring of national eco-labelling systems, based on local and regional criteria set by NGOs and social movements, and share them internationally. Urge governments to reform their trade laws to cover misleading and inaccurate labelling on products

    35. Join and initiate campaigns to pressure companies to end policies and production processes which are socially and environmentally detrimental to communities around the world

    36. Support legislation to strengthen consumer rights, especially to ensure environmentally sustainable, safe and healthy products, and establish the "right to know" laws which enable people to make informed consumption choices

    37. Support, initiate and use "green" funds that make socially and environmentally responsible investments

    38. Influence governments to counter the disproportionate influence of commercial self-interests in government and the media

    39. Support responsible tourism and create awareness about the negative effects of air travel


  32. cont.

    40. Participate in and support educational efforts, both formal and informal, which aim to increase awareness of critical global issues and their root causes and interrelationships, develop new values and attitudes and motivate changes in consumption, production and lifestyle. Social movements and NGOs should:

    a. provide educational methodologies which focus on values clarification and moving beyond blame to constructive action

    b. provide training and assistance for leaders of business and industry, government, unions and others on consumption and production

    c. initiate and support the training and work of environmental counselors who provide responsible consumption and product information

    d. cooperate with media to initiate and strengthen educational programs on the social and environmental impacts of consumption and production and to build awareness of consumer responsibility and potential

    e. support school reform movements to ensure integration of lifestyle education for responsible consumption

    f. ensure that courses related to marketing, economics, development, environment, etc., adapt their content to the new realities

    g. ensure that equal access to consumption and lifestyle education -- living better with less -- be made available to all.

    Reduce and Reuse

    41. Reduce impacts from "industrialized agriculture" by consuming foods which are locally grown by organic methods, low on the food chain, minimally processed and sold in bulk

    42. Reduce energy consumption through use reduction, conversion to renewable sources and utilization of efficient energy systems

    43. Reduce the waste and polluting effects of automobiles and aircraft through the alternative use of railroads, bicycles and public transportation

    44. Join coalitions and sponsor campaigns to pressure business and industry to eliminate built-in obsolescence, promote longer durability of products, reduce production of disposables and alter production processes which create toxic, hazardous or radioactive wastes

    45. Promote product maintenance and repair systems and second-hand markets

    46. Reduce wasteful and energy intensive long distance transport of products by encouraging consumption of local and regional products.


  33. cont.


    47. Promote, create and participate in local resource recovery systems, such as reuse and recycling centers, which involve separation at source. Pressure government and industry to financially support such local centers

    48. Urge packaging and distributing companies to implement an effective deposit-return system for containers and other packaging

    49. Pressure industry and government to organize "cradle to cradle" production processes

    50. Urge Northern governments, international financial institutions and aid agencies to give financial and technical support for resource recovery systems and management, particularly in the South

    51. Encourage industry to use recycled, before virgin, materials.

    Coordination, Monitoring And Evaluation

    52. Facilitate collaboration between grassroots, national and international social movements and NGOs and strengthen our networks to:

    53. Utilize national and international conferences of social movements and NGOs to monitor and evaluate progress on this treaty. Social movements and NGOs in the industrialized regions should bear primary responsibility for implementation of this agreement

    54. Build participation in and among social movements and NGOs at the national level to participate in the implementation of the treaty. National networks should appoint staff to coordinate the action plan

    55. Set measures of and evaluate progress of sustainable consumption and production patterns

    56. Operate information clearinghouses (including a database) to facilitate the sharing of lessons learned about consumer campaigns, research and actions of communities, government and industry

    57. Publish action alerts and sustain local and international campaigns by social movements, NGOs and consumer groups

    58. Research and publicize environmentally and socially sound initiatives

    59. Organize recognition programs for responsible and successful initiatives of social movements, governments, businesses, NGOs and others

    60. Monitor government and industry actions on these issues

    61. Strengthen our networks to monitor global economic systems and the transnational actions of government and industry. Pressure the new United Nations Commission on Sustainable Development (CSD) to assist networks of social movements and NGOs in their work

    62. Demand the significant involvement of social movements and NGOs in government efforts and international bodies.


  34. cont.

    Groups To Be Involved

    63. Social movements and NGOs will work to involve the widest number of organizations, especially women's and consumer organizations, which agree to the principles of this treaty.

    Resources. Signatories and supporters of this treaty will:

    64. Urge NGO networks to commit staff time and administrative resources to the implementation of the coordination, monitoring and evaluation

    65. Commit significant material, financial and human resources to carrying out the action plan and encourage the widest participation

    66. Demand that companies provide part of their budgets, personnel and training time to support positive change in consumption and production patterns

    67. Encourage funding agencies to support the activities in the treaty

    68. Encourage the United Nations, governments and funding agencies to support the actions of this treaty.


  35. To be successful, microfinance programs in China had to work within existing networks. (Deb Agrin)

    The most famous microfinance institution, the Grameen Bank, grew strong in the unregulated markets of Bangladesh. Nimble and flexible, the model built by the Grameen Bank proved to be an effective agent against poverty. It cut its teeth around the world, flourishing in Egypt, Bolivia, Uganda, Pakistan, and East Timor. But China was a different matter entirely. Would microfinance achieve new heights, or perish in the seemingly inhospitable market climate of China?

    The world’s most populous nation, China is home to 200 million people living in poverty. This is 17% of all the world’s poor. If people hope to solve global poverty, China cannot be ignored. However, the existing social organization in China posed steep challenges. Tight government regulations threatened to bog down microfinance’s trademark strategies. Moreover, microfinance was born entirely from a principle of capitalism: namely that wealth is grown, not distributed. This is at odds with China’s purported socialism. While China had some effective means of combating poverty, many of these strategies were not helping the poorest of the poor. How, then, did microfinance find its way through uncharted territory?

    In a word, microfinance adapted. For instance, the proven practice of forming groups of five clients, a hallmark of the Grameen Bank’s strategy, was difficult in both rural and urban areas of China. In many cases, both rural and urban areas were already organized into hierarchical units under the central government. People were not used to working outside of these groups. Therefore, microfinance institutions had to create groups that more closely resembled existing organizations. In some villages for instance, there were compulsory weekly meetings for almost the entire populations. These replaced smaller leadership meetings that were seen as central to microfinance’s success elsewhere. Microfinance institutions also bent the rules and allowed relatives to be members of the same group. They also relaxed their policy of having all-male or all-female group members.

    Perhaps the greatest obstacle facing microfinance in China was and remains strict governmental regulations. China prohibits non-financial institutions from offering financial services to the public.To solve this problem, governments and microfinance donors are granted temporary legal exemption for their projects. There was a price, however: these organizations are not allowed to operate as independent institutions. They receive funding from the Chinese government and must accept the strings that are attached. For instance, if the government wants to target some people with loans and not others, the institutions must comply.

    more at link


  36. The Economics of Microfinance
    By Bowman, Chakriya
    Publication: Economic Record
    Date: Friday, December 1 2006

    The Economics of Microfinance, by Beatriz Armend?riz de Aghion and Jonathan Morduch (MIT Press, Cambridge, Massachusetts, 2005), pp. 352.

    Microfinance is a topic prone to hyperbole. Beloved of capitalist politicians and socialist activists alike, microfinance purports to help the poor by providing access to previously unobtainable capital. Books filled with heartfelt case studies of impoverished women whose lives were transformed when they started their home business with the help of a loan merely create the impression of an industry geared to providing photo opportunities for visiting celebrities. These books tend to portray money lenders as the bad guys, out to exploit the vulnerable within the community, while the founders of microfinance institutions ride in like benevolent knights on white horses to transform the lives of the poor through commerce.

    This is not one of those books.

    The Economics of Microfinance provides a comprehensive overview of the current state of the microfinance industry. Commencing with the motivations for microfinance, it outlines the theory behind the stories and the arguments both for and against microbanking. There is no doubt that microfinance is an effective tool for development, and one that has been remarkably successful. When it was introduced, it represented a paradigm shift: it demonstrated that capital could be effectively managed by those whom many believed were incapable of using it. It countered common prejudices and resulted in some surprising developments. All of these aspects are discussed in this book.


  37. Microfinance the ‘Third Way’?

    A recent article in Time magazine, while covering the recent presidential races in Latin America, positions it as a battle between the statist policies of the Latin American left and Washington’s agenda of globalization. Given Latin America’s history of swinging between oligarchy and populist socialism, they place an argument for a ‘third way’ åö a European style mix of socialist and capitalist policymaking, something that will address the needs of the poor while not bleeding the nations dry.

    And the example Time cites, and it is the only example provided, is microfinance.



    Commissioner-General's address on the occasion of the AGFUND International Prize for Pioneering Development Projects, held under the patronage of His Royal Highness Prince Talal Bin Abdel Aziz, President of the Arab Gulf Programme for United Nations Development Organisations

    15 February 2000, UN HQ Geneva

    Your Royal Highness, Excellencies, ladies and gentlemen, colleagues. It is with great honour and deep appreciation that I accept the AGFUND Prize for International Pioneer Projects in the field of "Poverty Eradication and Alleviation" on behalf of UNRWA, the United Nations Relief and Works Agency for Palestine Refugees in the Near East.

    It is especially gratifying for UNRWA to be chosen for this award by so prestigious a committee; composed of such distinguished individuals as Dr. Ahmed Mohammed Ali, Dr. Fredrico Mayor, Ms. Rigoberta Menchu Tum, Dr. Seyyid Adbduali and Professor Mohammed Yunis. Not only have they played important roles in raising international awareness about the poor and marginalised. They have each actively contributed to the development of poverty alleviation strategies based on the humanitarian principle that the poor must be empowered through "resources of hope" to enable them to change their life circumstances. It is this shared principle that we in UNRWA have used in the development of our microfinance activities.

    I know that the staff of UNRWA's microfinance programme are especially proud that Professor Yunis is among those who selected their project. To them (and us) he is the Guru of microfinance. They have followed with awe the achievements of the GRAMEEN Bank, which has done so much to improve the lives of millions of poor in Bangladesh. From him they have learnt that credit is a basic human right; a right that allows poor and marginalised people to improve the lot of their children and families through their own endeavours and entreprenuership.

    more at link


  39. Reinforce the Microfinance Securitization in Palestine with priority to the Gaza Strip.
    By , The Palestinian Network for Small and Microfinance

    The Palestinian Network for Small and Microfinance (hereinafter: Sharakeh) is a non-profit non-governmental organization. Established in 2002, Sharakeh represents a forum of micro finance non-profit institutions and programs (hereinafter: MFIs) that aim at providing financial services to small enterprises, and focuses its efforts on the growth of microfinance industry in the West Bank and Gaza Strip; particularly that micro financing is considered one of the strongest tools for economic development consistent with Palestinian economy needs.

    Sharakeh represented nine active members when established, but expanded its representation of the sector with four additional associate members; Currently, the 13 Micro Finance programs and Institutions members of Sharakeh serve approximately 30,000 micro-entrepreneurs, with a portfolio of over 37 million US Dollars. (As of September 2008).

    Microfinance in the Gaza Strip

    Historically, the microfinance activity in the Gaza Strip (GS) exceeded similar activities in the West Bank (WB). Poverty rates were higher, resources were fewer and the continuous political aggression and siege against the GS contributed profoundly in increasing poverty rates and reducing potential opportunities for economic advancement.

    Since 2006, the microfinance sector in general and in the GS in particular, faced a huge drop in size of activities and considerable increase in PAR.. Due to post elections donors’ decision to seize injection of financial aid to the public sector, and the political pressure imposed on Palestinians; microfinance institutions (MFIs) were forced to reduce activities in the GS while increase it in the WB. Although this shift was witnessed, MFIs focused on client retention in the GS using different methodologies; re-scheduling, re-financing and other.

    On December 27, 2008, an Israeli operations against Hammas in the Gaza Strip started, causing extreme infrastructure destruction, as well as severe human losses.

    Despite the continuous need, the Israeli Siege on GS starting 2006 and following the Palestinian Legislative Council elections and the public servants salary crisis, and the following political and economical obstacles imposed on both individuals and microfinance institutions in GS, a significant drop of activities there were anticipated.


  40. cont

    At the end of 2007, only 20% of the microfinance activities in the oPT was within the Gaza Strip. With continuous efforts from MFIs to survive the crisis, by re-scheduling, writing off loans, and client retention efforts, MFIs in the Gaza Strip managed to slightly raise the percentage of activities in Gaza to 25% in the first quarter. Although number of loans in the strip slightly increased during the first three quarters of 2008, (819 in Q1, 998 in Q2, and 1250 in Q3) their percentage of total loans disbursed in the oPT dropped to 18% at the end of September 2008.

    MFIs suffered a great deal of losses while struggling the continuous deterioration on the political situation and the intensive aggression of the Israeli forces, throughout the past three years. Sharakeh has been examining the potential and possibilities to provide assistance to the MFIs in order to (1) Maintain their outstanding portfolio in the Gaza Strip, (2) Retain quality relationship with clients, and (3) contribute to the national poverty reduction efforts.

    A Credit Guarantee Scheme to address Contextual Risk for Microfinance

    Contextual risk has become structural for Palestinian MFIs as they are under a tremendous pressure whereby the effects of the violent, illegal and illegitimate occupation of West Bank and the permanent locking of GAZA make it difficult for MFIs to implement their mission to promote financial services in a normal manner. This risk is broadly known.

    In order to address this specific risk, SIDI (Solidarité Internationale pour le Développement & l’Investissement, France) and ACAD (The Arab Center for Agricultural Development) have been designing a Credit Guarantee Scheme (CGS) which has been operational since January 1st 2008 in order to secure ACAD’s loan portfolio. The scheme, endowed already with 200,000 Euros by SIDI (France) and Caixa Catalunya (Spain) has just received the commitment of the French Development Agency for another 100,000 €, is about to be opened up to other Palestinian MFI’s.

    SIDI and ACAD decided to open up the scheme for all MFI’s and the instrument to be institutionalized under SHARAKEH as a substantial input for the sector.

    Appeal to the donor community

    Sharakeh’s appeal to the donor community revolves around the preservation of the role of microfinance for economic development in structural crisis. Where it is in fact the goal is to create Credit Guarantee Scheme to serve the microfinance industry in general, relying on the tested Scheme.

    Sharakeh aims at establishing a three (3) million Euro scheme to initiate the fund and support MFIs, with a priority of Gaza Strip. Currently secured is the total amount of 300,000 Euros.


  41. Special thanks goes to Dorothy for these articles pertaining to microcredit in Gaza.

  42. How UNRWA Supports Hamas

    Palestinians in the new Islamic State of Gaza, crying out for more aid from the United Nations, are turning to United Nations Relief and Works Agency (UNRWA) for help. Their reliance upon UNRWA comes as no surprise. The organization has been providing food, medicine, and social services to the Palestinian people for 57 years. Unfortunately, UNRWA has never taken steps to withhold assistance to extremist groups. In some cases, it has cooperated openly with terrorists. Today, as UNRWA provides assistance in Gaza, it is directly providing financial and material support to the Hamas terrorist organization.

    A Mutually Beneficial Relationship
    According to the U.N. aid agency for Palestinian refugees, up to 825,000 of Gaza's 1.5 million inhabitants claim refugee status. These Gazans receive food rations and other assistance through the United Nations, including medicine, education, and even jobs via UNRWA.

    While the refugees benefit from UNRWA, the organization benefits more from the refugees. These refugees are the organization's raison d'etre. Accordingly, UNRWA has zero incentive to resolve the Palestinian refugee problem; ending the refugee problem would render the agency obsolete.

    The interests of the refugees and UNRWA are so intertwined that UNRWA is staffed in situ mainly by local Palestinians—more than 23,000 of them—with only about 100 international United Nations professionals. While the U.N. High Commission on Refugees (UNHCR) and UNICEF (United Nations International Children's Fund) avoid employing locals who are also recipients of agency services, UNRWA does not make this distinction.

    Thus, in the interest of self-perpetuation, UNRWA seeks to maintain the violent status quo in the Middle East, even if it means turning a blind eye to terror.

    Helping Hamas Govern Gaza
    Supporting the status quo means that UNRWA can be counted on to support the new Hamas government, so long as Hamas enables UNRWA's continued existence. UNRWA is only too eager to provide the services that Hamas does not, cannot, or chooses not to. Hamas can continue to divert international monies that should be earmarked for food or electricity to the stockpiling of weapons and the creation of anti-Israel or anti-American propaganda as long as UNRWA provides the services that the negligent Hamas government should fulfill. In this way, UNRWA is undermining the Western strategy of weakening the Hamas government in Gaza to encourage the return of Palestinian Authority rule under President Mahmoud Abbas.

    UNRWA does not hide this. As Commissioner General Karen AbuZayd states, UNRWA's goal "is to reconstruct houses, create jobs, and micro-financing." It has been filling this role since 1991, when UNRWA launched its micro-finance and micro-enterprise program (MMP) in the West Bank and Gaza Strip. Indeed, UNRWA provides services that the Palestinian economic ministry or treasury should handle. UNRWA, originally conceived as a temporary apparatus to ease the refugees' economic plight more than a half-century ago, has been providing the Palestinians of Gaza (as well as the West Bank, Lebanon, Syria, and Jordan) with critical economic services for a decade so that the Palestinian government, whether Hamas or the Palestinian Authority, can continue to concentrate on "resistance."

    more at link


  43. Here are some of Dorothy's commentary:

    The very same United Nations Relief and Works Agency (UNRWA) welcomed the Code Pink "peace" delegation to Gaza last year.

    Recall that the self-confessed witch named Starhawk is a co-founder of Code Pink and an associate with former "Green Jobs Czar," Van Jones. Both sit on a board of the Institute of Noetic Sciences. Starhawk was among the "peaceniks" during Code Pink's last visit......as were Obama's pals Bernardine Dohrn and William Ayers.

    .....Hamas, Code Pink, Bill Ayers, Bernardine Dohrn, Jodie Evans and Barack Obama. Quite a witches brew. And Huffington Post and Politico wonder why Americans doubt Obama’s commitment to win the war on terror.

    Oh, and speaking of witches, Code Pink’s Wiccan co-founder (Starhawk) took time off from her ‘dirt worship’ and made a rare visit to the front lines with he Code Pink partners to help Hamas from Cairo. You can read her reports which feature her Baby-Boomer angst and her disdain for protest chanting and fasting here....


  44. (UNRWA) Head John Ging, welcomes Code Pink Peace Delegation to Gaza


    UNRWA official web site
    The delegation was organised by the U.S based women's peace group CODEPINK and came at the invitation of UNRWA's 'Equality in Action' programme, ...


    Bank For the Poor
    Muhammad Yunus, Managing Director, Grameen Bank; o Dr. Alex Pollock, Director of Microfinance and Microenterprise Programme at UNRWA, representing AGFUND ...


  45. These above pieces should go a long way toward showing just how related all of these issues are. I have much more that I want to incorporate into a article showing a three way connection between microcredit, GS1 initiatives, and the middle east peace process. The above pieces should make for a good teaser.

  46. I realized I attributed some above commentary to Dorothy, when in fact the commentary belongs to Susanna. This is a mistake that can be made when carrying on a three way conversation through email.

  47. More on RFID:


  48. Here is an article speaking about everything JD and company are researching about plus more.


    Within the article is a link that everyone should go to regarding the Smart Grid and much more....


  49. JD:

    What's your take on Van Jones. Obama, and their colleagues. Are they Maxists, new age / mystic, or both? We often write them off for political reasons but are they all working toward a new spiritual world?

    Dave in CA

  50. Dave in CA,

    Van Jones is involved across a few of the aspects I have been investigating, expect his name to come up in my next couple articles. Biden and his family are pretty involved as well. Obama literally embodies many of the thoughts and principles at work, while pushing forward the New Age/UN agenda. If I had to tag them all with something I believe New Age is the most accurate, with leanings in some of the other descriptors directions. I don't know if I could safely call any of them mystics, at least they are not in public. Although a case could be made that they lean toward pantheism or panentheism. They are definitely working toward the advancement of the New Age, and are doing so with a uniformity that I have a hard time believing is coincidence. My next couple of articles will be dedicated to this group and their projects, which I hope will give you a better idea of what I am talking about.

  51. I listened to a program entitled Radio Warrior last night (April 1) from 11:00 p.m. to midnight, CDT on the Republic Broadcasting Network (RBN). The host Chris Hinkley analyzed how the recently passed Healthcare law could facilitate the implantation of RFID chips into the population, and the relationship of this to players who would be beneficiaries of the law or stand to profit from it. I know Newt Gingrich has stated the need for digital health records in order to achieve cost saving efficiency in the U.S. healthcare system. I noticed on the RBN website that they have a free trial offer where their archives of past programs may be listened to. I will say I have noticed a bias against the state of Israel or against Zionism in the RBN programming. All I am saying here is that I found last night's Road Warrior program with Chris Hinkley on RBN fascinating. And since it directly pertained to the subject of this TDINTD Blog, I post this comment. Finally, an established nexus between tracking or controlling the population and the passage of the healthcare legislation, and I use the word "healthcare", advisedly, might go a long way in explaining why it was so critical for the powers that be to get it passed, i.e., if their aim is control. Eric, AKA: nicenter

  52. Eric,

    Thanks for the heads up. I have more than my share of concerns about RBN. Any group that would promote Ted Pike or David Duke as RBN has should be taken under extreme scrutiny. I am glad to see someone is picking up on it, I just wish it were not a group that I could now be marginalized for covering similar information as. I have seen enough to know that this is the way it works, look at the recent Huratree militia pieces. Now anyone with a speculative view of the EU(which I also hold) or a disenting view of the current workings of the US can be lumped into a similar category and declared dangerous. RBN could end up in a similar way as all of this plays out, since they espouse beliefs that are not diverse and would not hold up to AoC standards.

    I am working on more info as it pertains to this subject and yet more showing how this is ultimately a push into Sustainable Development and adherence to the Millenium Development Goals. My next piece (which I am working on) will deal with the current administration and show that for many of the members these ideas and agendas were ingrained well before they took public office.

    If you don't mind me asking, from what end was RBN suggesting this? I have seen postulation about the sub section dealing with Class II implantable devices, which in truth is a wash as it simply requires a registry for said devices and does not require anyone to be chipped.

  53. http://worlduin.homestead.com/

    Here is a new website about the world unique id number, linked to Discerning the
    Times Online website.

  54. Hi, JD

    Just found this and thought you might want to check it out: THE EU AND SUSTAINABLE DEVELOPMENT


    Prayers for you on whatever personal situation is lurking for you.


  55. Don't be surprised at anything Newt Gingrich does. He is a HARD CORE NEW AGER and I have been observing his serpentine trajectory since 1982.


  56. Constance,

    Thanks for the link. While some are still lingering, most of the personal issues I have been dealing with are getting resolved. I am working on my next piece, but I am still gathering new information pertaining to it, including some showing how members of the current administration may have had a predetermined role to play or at least a previous exposure to the agenda from a very young age.

  57. JD, Re: Chris Hinkley and his comments on the Healthcare law on his
    Radio Warrior program the night of April 1 on the Republic Broadcasting Network (RBN), I cannot remember the specifics as to the basis for his comments. I have not read the Healthcare bill/law. However, Mr. Hinkley spent the duration of his hour long show discussing the Healthcare law and its ramifications, including the roles of those who benefited or will benefit from its passage, i.e., "Follow the money." After reading the comments of Economist Thomas Sowell in WorldNetDaily, it has seemed curious to me the seeming urgency of its passage even though it won't take effect until
    four years later? Kind regards, Eric, AKA: nicenter,

  58. Eric,

    Some sections will not take effect for four years, such as the parts that could be beneficial. However the taxation will start within a year, the creation of the National Health Information Network and digital medical records is already underway, and a insurance companies ability to refuse enrollment was immediately ceased. As you said follow the money and you see why.

  59. Hi JD,

    My prayers are with you and your family. Very big story today in NY Times on Microfinance crises including evident profiteering at exorbitant interest rates. Front page and almost all of another page.


  60. Constance,

    Thanks, Susanna passed the story on to me, which I intend to post here. It fits with many things we have already discovered about this form of lending, most notably the fradulent repayment numbers and the fact that most loans are only possible due to support of philanthropies and third parties. My next piece will contain much more information on microcredit as it pertains to our leaders as well as information pertaining to RFID and the ever unfolding traceability system.

  61. Banks Making Big Profits From Tiny Loans

    In recent years, the idea of giving small loans to poor people became the darling of the development world, hailed as the long elusive formula to propel even the most destitute into better lives.

    Actors like Natalie Portman and Michael Douglas lent their boldface names to the cause. Muhammad Yunus, the economist who pioneered the practice by lending small amounts to basket weavers in Bangladesh, won a Nobel Peace Prize for it in 2006. The idea even got its very own United Nations year in 2005.

    But the phenomenon has grown so popular that some of its biggest proponents are now wringing their hands over the direction it has taken. Drawn by the prospect of hefty profits from even the smallest of loans, a raft of banks and financial institutions now dominate the field, with some charging interest rates of 100 percent or more.

    “We created microcredit to fight the loan sharks; we didn’t create microcredit to encourage new loan sharks,” Mr. Yunus recently said at a gathering of financial officials at the United Nations. “Microcredit should be seen as an opportunity to help people get out of poverty in a business way, but not as an opportunity to make money out of poor people.”

    The fracas over preserving the field’s saintly aura centers on the question of how much interest and profit is acceptable, and what constitutes exploitation. The noisy interest rate fight has even attracted Congressional scrutiny, with the House Financial Services Committee holding hearings this year focused in part on whether some microcredit institutions are scamming the poor.

    Rates vary widely across the globe, but the ones that draw the most concern tend to occur in countries like Nigeria and Mexico, where the demand for small loans from a large population cannot be met by existing lenders.

    Unlike virtually every Web page trumpeting the accomplishments of microcredit institutions around the world, the page for Te Creemos, a Mexican lender, lacks even one testimonial from a thriving customer — no beaming woman earning her first income by growing a soap business out of her kitchen, for example. Te Creemos has some of the highest interest rates and fees in the world of microfinance, analysts say, a whopping 125 percent average annual rate.


  62. cont.

    The average in Mexico itself is around 70 percent, compared with a global average of about 37 percent in interest and fees, analysts say. Mexican microfinance institutions charge such high rates simply because they can get away with it, said Emmanuelle Javoy, the managing director of Planet Rating, an independent Paris-based firm that evaluates microlenders.

    “They could do better; they could do a lot better,” she said. “If the ones that are very big and have the margins don’t set the pace, then the rest of the market follows.”

    Manuel Ramírez, director of risk and internal control at Te Creemos, reached by telephone in Mexico City, initially said there had been some unspecified “misunderstanding” about the numbers and asked for more time to clarify, but then stopped responding.

    Unwitting individuals, who can make loans of $20 or more through Web sites like Kiva or Microplace, may also end up participating in practices some consider exploitative. These Web sites admit that they cannot guarantee every interest rate they quote. Indeed, the real rate can prove to be markedly higher.

    Debating Microloans’ Effects

    Underlying the issue is a fierce debate over whether microloans actually lift people out of poverty, as their promoters so often claim. The recent conclusion of some researchers is that not every poor person is an entrepreneur waiting to be discovered, but that the loans do help cushion some of the worst blows of poverty.

    “The lesson is simply that it didn’t save the world,” Dean S. Karlan, a professor of economics at Yale University, said about microlending. “It is not the single transformative tool that proponents have been selling it as, but there are positive benefits.”

    Still, its earliest proponents do not want its reputation tarnished by new investors seeking profits on the backs of the poor, though they recognize that the days of just earning enough to cover costs are over.

    “They call it ‘social investing,’ but nobody has a definition for social investing, nobody is saying, for example, that you have to make less than 10 percent profit,” said Chuck Waterfield, who runs mftransparency.org, a Web site that promotes transparency and is financed by big microfinance investors.

    Making pots of money from microfinance is certainly not illegal. CARE, the Atlanta-based humanitarian organization, was the force behind a microfinance institution it started in Peru in 1997. The initial investment was around $3.5 million, including $450,000 of taxpayer money. But last fall, Banco de Credito, one of Peru’s largest banks, bought the business for $96 million, of which CARE pocketed $74 million

  63. cont.

    “Here was a sale that was good for Peru, that was good for our broad social mission and advertising the price of the sale wasn’t the point of the announcement,” Helene Gayle, CARE’s president, said. Ms. Gayle described the new owners as committed to the same social mission of alleviating poverty and said CARE expected to use the money to extend its own reach in other countries.

    The microfinance industry, with over $60 billion in assets, has unquestionably outgrown its charitable roots. Elisabeth Rhyne, who runs the Center for Financial Inclusion, said in Congressional testimony this year that banks and finance firms served 60 percent of all clients. Nongovernmental organizations served 35 percent of the clients, she said, while credit unions and rural banks had 5 percent of the clients.

    Private capital first began entering the microfinance arena about a decade ago, but it was not until Compartamos, a Mexican firm that began life as a tiny nonprofit organization, generated $458 million through a public stock sale in 2007, that investors fully recognized the potential for a windfall, experts said.

    Although the Compartamos founders pledged to plow the money back into development, analysts say the high interest rates and healthy profits of Compartamos, the largest microfinance institution in the Western Hemisphere with 1.2 million active borrowers, push up interest rates all across Mexico.

    According to the Microfinance Information Exchange, a Web site known as the Mix, where more than 1,000 microfinance companies worldwide report their own numbers, Compartamos charges an average of nearly 82 percent in interest and fees. The site’s global data comes from 2008.

    But poor borrowers are often too inexperienced and too harried to understand what they are being charged, experts said. In Mexico City, Maria Vargas has borrowed larger and larger amounts from Compartamos over 20 years to expand her T-shirt factory to 25 sewing machines from 5. She is hazy about what interest rate she actually pays, though she considers it high.

    “The interest rate is important, but to be honest, you can get so caught up in work that there is no time to go fill out paperwork in another place,” she said. After several loans, now a simple phone call to Compartamos gets her a check the next day, she said. Occasionally, interest rates spur political intervention. In Nicaragua, President Daniel Ortega, outraged that interest rates there were hovering around 35 percent in 2008, announced that he would back a microfinance institution that would charge 8 to 10 percent, using Venezuelan money.

    There were scattered episodes of setting aflame microfinance branches before a national “We’re not paying” campaign erupted, which was widely believed to be mounted secretly by the Sandinista government. After the courts stopped forcing small borrowers to repay, making international financial institutions hesitant to work with Nicaragua, the campaign evaporated.

    A Push for More Transparency

    The microfinance industry is pushing for greater transparency among its members, but says that most microlenders are honest, with experts putting the number of dubious institutions anywhere from less than 1 percent to more than 10 percent. Given that competition has a pattern of lowering interest rates worldwide, the industry prefers that approach to government intervention. Part of the problem, however, is that all kinds of institutions making loans plaster them with the “microfinance” label because of its do-good reputation.

    Damian von Stauffenberg, who founded an independent rating agency called Microrate, said that local conditions had to be taken into account, but that any firm charging 20 to 30 percent above the market was “unconscionable” and that profit rates above 30 percent should be considered high.


  64. cont.

    Mr. Yunus says interest rates should be 10 to 15 percent above the cost of raising the money, with anything beyond a “red zone” of loan sharking. “We need to draw a line between genuine and abuse,” he said. “You will never see the situation of poor people if you look at it through the glasses of profit-making.”

    Yet by that measure, 75 percent of microfinance institutions would fall into Mr. Yunus’s “red zone,” according to a March analysis of 1,008 microlenders by Adrian Gonzalez, lead researcher at the Mix. His study found that much of the money from interest rates was used to cover operating expenses, and argued that tackling costs, as opposed to profits, could prove the most efficient way to lower interest rates.

    Many experts label Mr. Yunus’s formula overly simplistic and too low, a route to certain bankruptcy in countries with high operating expenses. Costs of doing business in Asia and the sheer size of the Grameen Bank he founded in Bangladesh allow for economies of scale that keep costs down, analysts say. “Globally interest rates have been going down as a general trend,” said Ms. Javoy of Planet Rating.

    Many companies say the highest rates reflect the costs of reaching the poorest, most inaccessible borrowers. It costs more to handle 10 loans of $100 than one loan of $1,000. Some analysts fear that a pronounced backlash against high interest rates will prompt lenders to retreat from the poorest customers.

    But experts also acknowledge that banks and others who dominate the industry are slow to address problems.

    Added Scrutiny for Lenders

    Like Mexico, Nigeria attracts scrutiny for high interest rates. One firm, LAPO, Lift Above Poverty Organization, has raised questions, particularly since it was backed by prominent investors like Deutsche Bank and the Calvert Foundation.

    LAPO, considered the leading microfinance institution in Nigeria, engages in a contentious industry practice sometimes referred to as “forced savings.” Under it, the lender keeps a portion of the loan. Proponents argue that it helps the poor learn to save, while critics call it exploitation since borrowers do not get the entire amount up front but pay interest on the full loan.

    LAPO collected these so-called savings from its borrowers without a legal permit to do so, according to a Planet Rating report. “It was known to everybody that they did not have the right license,” Ms. Javoy said.

    Under outside pressure, LAPO announced in 2009 that it was decreasing its monthly interest rate, Planet Rating noted, but at the same time compulsory savings were quietly raised to 20 percent of the loan from 10 percent. So, the effective interest rate for some clients actually leapt to nearly 126 percent annually from 114 percent, the report said. The average for all LAPO clients was nearly 74 percent in interest and fees, the report found.


  65. cont.

    Anita Edward says she has borrowed money three times from LAPO for her hair salon, Amazing Collections, in Benin City, Nigeria. The money comes cheaper than other microloans, and commercial banks are virtually impossible, she said, but she resents the fact that LAPO demanded that she keep $100 of her roughly $666 10-month loan in a savings account while she paid interest on the full amount.

    “That is not O.K. by me,” she said. “It is not fair. They should give you the full money.”

    The loans from LAPO helped her expand from one shop to two, but when she started she thought she would have more money to put into the business.

    “It has improved my life, but not changed it,” said Ms. Edward, 30.

    Godwin Ehigiamusoe, LAPO’s founding executive director, defended his company’s high interest rates, saying they reflected the high cost of doing business in Nigeria. For example, he said, each of the company’s more than 200 branches needed its own generator and fuel to run it.

    Until recently, Microplace, which is part of eBay, was promoting LAPO to individual investors, even though the Web site says the lenders it features have interest rates between 18 and 60 percent, considerably less than what LAPO customers typically pay.

    As recently as February, Microplace also said that LAPO had a strong rating from Microrate, yet the rating agency had suspended LAPO the previous August, six months earlier. Microplace then removed the rating after The New York Times called to inquire why it was still being used and has since taken LAPO investments off the Web site.

    At Kiva, which promises on its Web site that it “will not partner with an organization that charges exorbitant interest rates,” the interest rate and fees for LAPO was recently advertised as 57 percent, the average rate from 2007. After The Times called to inquire, Kiva changed it to 83 percent.

    Premal Shah, Kiva’s president, said it was a question of outdated information rather than deception. “I would argue that the information is stale as opposed to misleading,” he said. “It could have been a tad better.”

    While analysts characterize such microfinance Web sites as well-meaning, they question whether the sites sufficiently vetted the organizations they promoted.

    Questions had already been raised about Kiva because the Web site once promised that loans would go to specific borrowers identified on the site, but later backtracked, clarifying that the money went to organizations rather than individuals.

    Promotion aside, the overriding question facing the industry, analysts say, remains how much money investors should make from lending to poor people, mostly women, often at interest rates that are hidden.

  66. cont.

    “You can make money from the poorest people in the world — is that a bad thing, or is that just a business?” asked Mr. Waterfield of mftransparency.org. “At what point do we say we have gone too far?”


  67. JD,

    I just posted this over at Constance's blog, but I thought it also belonged here.


    The World Tourism Organization (WTO) is vested by the United Nations with a central and decisive role in promoting the development of responsible, sustainable and universally accessible tourism, with the aim of contributing to economic development, international understanding, peace, prosperity and universal respect for, and observance of, human rights and fundamental freedoms. In pursuing this aim, the Organization pays particular attention to the interests of the developing countries in the field of tourism.

    By Eugenio Yunis, Head of Department and Philippe Lemaistre, Programme Officer, Sustainable Development of Tourism

    Tourism has undeniably become one of the major economic activities worldwide. According to data collected by WTO, the number of international tourist arrivals have exceeded 700 million every year since 2000. These international movements generate annual receipts approaching US$ 500 billion, plus an estimated US$ 100 billion in international transport fare receipts. WTO forecasting studies, regularly updated to take into account changing factors and crisis (like terrorist attacks and epidemics), indicate that international tourist arrivals are expected to reach 1 billion by the year 2010, and just over 1.5 billion by the year 2020. These data do not take into account domestic tourist movements in each country, which often exceed the number of international tourist arrivals.

    Tourism and poverty alleviation

    Tourism can be harnessed as a significant force for the alleviation of poverty, as well as for the protection of the environment and traditional cultures, giving economic value to natural and cultural heritage, creating employment and generating foreign exchange earnings. WTO is already taking a number of strategic steps to improve the contribution of tourism to poverty alleviation, including engagement in world trade negotiations, promoting the concept of sustainable tourism to all policy makers and establishing a special initiative on poverty, called Sustainable Tourism – Eliminating Poverty (ST-EP), in partnership with others.

    There is much evidence to suggest that tourism is already important and keeps growing in many of the countries that suffer from poverty. In 2001, for example, international tourism receipts for developing countries amounted to US$ 142,306 million while between 1990 and 2000, the export value of tourism grew by 154% in these countries.

    Besides, tourism is composed of a wide network of micro, small and medium sized enterprises (SMEs) and can create further opportunities for many small entrepreneurs in an industry in which start-up costs and barriers to entry are generally low or can easily be lowered. Indeed, in the hotel sector for example, it is estimated that 80% of the bed capacity worldwide correspond to small and independent, non-chain establishments, including many family-owned enterprises, which are more labour intensive than big resorts. Similarly, small entrepreneurs provide many other tourism services, especially in developing countries.

    Tourism is also a more diverse industry than many others: it has the potential to support other economic activities, both through providing flexible, part time jobs that can complement other livelihood options, and by creating income throughout a complex supply chain of goods and services: furniture and furnishings, handicrafts, food items, agricultural products, guiding services, etc. Most of these are also produced and provided by small entrepreneurs.

    Also, leaving aside economics, it can bring non-material benefits such as pride in local culture and a valorisation of the surrounding natural environment in the eyes of local communities.


  68. cont...

    Microcredit and tourism

    Nevertheless, it is often difficult for small entrepreneurs to borrow the relatively small amount of money needed to start their activity and to sustain it with the necessary operational funding. In developing countries in particular, there is usually a lack of opportunities for SMEs to borrow from the banking system, especially for young people and women.

    This is particularly visible in rural areas where most of the poor live and where there are very few development options other than tourism. The development of a microcredit system for tourism SMEs both for venture capital and operating costs, could be one of the missing links to allow tourism to bring more prosperity in many regions worldwide, principally in the poorest.

    The speed with which tourism SMEs can access loans is also essential in an activity often characterised by seasonality. For instance, if a tourism entrepreneur is not financially ready for the tourist season, he will probably suffer the loss of most of his year’s receipts.

    On the occasion of the International Year of Microcredit, awareness campaigns addressed to different stakeholders, in support of actions linking tourism and microcredit, should be put in place to allow tourism to fully develop its potential as an economic driving force in favor of the poor. These campaigns should intend to:

    allow the banking system to realise the economic potential, stability and profitability of tourism, even at a small scale;
    encourage governments, especially the ministries in charge of tourism, to provide technical support to SMEs and to act as guarantors of tourism SMEs
    inform poor communities of the potential of business opportunities in tourism to provide complementary income, and to encourage them to consider microcredit to develop their activities;
    help NGOs guide communities in their contacts with the banking system.
    In the framework of the Year of Microcredit, the World Tourism Organization will reinforce its efforts and further pursue its actions to reduce poverty through tourism. At the same time, WTO is encouraging the National Tourism Administrations of its Member States to establish links with the Year National Committees in each country, so as to ensure that the different national and international initiatives address the issues of sustainable development of tourism and poverty alleviation in a synergistic way.

    For more information on the World Tourism Organization, visit:



  69. Susanna,

    I'm shaking my head in disbelief. Tourism to solve poverty. Who would even put in their heads the idea? And this comes from places that apparently have better educational systems than here in America?

    If it involved roller-coasters, then I could buy into that.

  70. David and Susanna,

    You can't fix poverty with tourism, it is not a substitute for solid revenue, just ask the state of Florida. At best tourism in any given area is seasonal, and desires to see certain places and do certain things change with the wind. Look at Disney, they have spent millions revamping their parks and still can't draw flies. If these people truly wanted to help the poor and destitute, they would help them build an industry where they could produce something tangible, something people actually need. I personally watched as the state of Florida was systematicly destroyed by changing the focus from producing agricultural products like oranges, tomatoes, bannanas, beef, seafood, etc, to housing based in location and tourism. This was all done in the name of Sustainable Development and was my first taste of the hypocrisy involved as it is based in models that are not sustainable. I watched as they moved wetlands from acerage spread over private property, to the same amount of acerage spread out in the middle of medians on busy highways. Ask another true Floridian (not a transplant or snowbird) what they think of what has been done to their state.

  71. JD and David,

    I was shaking my own head in disbelief when I first read the article.

    However, I don't think the microcredit is about "helping the poor." It is about controlling people.

    JD, you are right. Tourism is a passing seasonal thing and depends on what is "the cool thing to do" at any given time.

    People always have to eat. They do not always have to go to Disney World!

  72. Here in Michigan there's been this hope that tourism would pull us out of the financial bottom. And I think there are a lot of fun things to do in Michigan. I haven't seen a great financial turn-around because of it.

    The World Tourism Organization is taking this to a whole different level, though. Helping the poor through tourism--I don't get it. It's just some scheme to encourage microcredit lenders. I wonder what's in it for them. Control?

  73. Control is EXACTLY what is in it for them!

    Do you remember the song by the late Tennessee Ernie Ford? ( a.k.a. "the old peapicker himself?" ) I am into old time music from this era and the refrain of this song called "SIXTEEN TONS" fits the wickets in terms of describing the scamming that frequently goes tandem with microcredit.

    The chorus of "Sixteen Tons" is:

    You load sixteen tons, what do you get?
    Another day older and deeper in debt.
    Saint Peter, don't you call me, 'cause I can't go;
    I owe my soul to the company store.


    In those times the coal miners were often forced to shop at the "company store."




    According to (Merle) Travis,( who first recorded this song) the line from the chorus "another day older and deeper in debt" was a phrase often used by his father, a coal miner himself. This and the line "I owe my soul to the company store" is a reference to the truck system and to debt bondage. Under this system workers were not paid cash; rather they were paid with unexchangeable credit vouchers for goods at the company store, usually referred to as scrip. This made it impossible for workers to store up cash savings. Workers also usually lived in company-owned dormitories or houses, the rent for which was automatically deducted from their pay. In the United States the truck system and associated debt bondage persisted until the strikes of the newly-formed United Mine Workers and affiliated unions forced an end to such practices.


    Some of the Muhammad Yunus lending enterprises force borrowers to buy things they need to start up their businesses from companies in which the lenders have a financial stake.

    Moreover, some of these same microcredit enterprises are charging interest rates that are only a tiny little bit less usurious than the local loan sharks from whom whom Yunus claims to be "rescuing" people.

    As you said, David, microcredit is often more about control than it is about "lifting the poor out of their impoverished circumstances."

  74. Is using cash becoming more and more 'evil'?


  75. Dawn,

    While it is plain to see that the move away from cash transactions has been slow and building, I do suspect there will be a final reasoning for it's final removal. This will be a drastic step, so a couple of catalysts combined may be used. I suspect it in part will have to do with combinations of currencies, forgery, lack of costs to mint, etc. and most likely a desire to trace all transactions, resulting from a yet unknown catastrophe. The cash transaction has been villified in media and law enforcement due to it's privacy. All that is really needed now is to get the public thinking in a similar fashion, the right amount of fear ought to accomplish this, after all not too many people rely heavily on the paper stuff anymore.