WHY THE GRAMEEN FOUNDATION? The reasons that led me to decide to support the Grameen Foundation rather than any other microcredit organization are still the same as they were when I posted “Grameen (1): Apology for a nomination” 7 years ago. http://boards.fool.com/Message.asp?mid=13570649&sort=recommendations Even though the rules for Foolanthropy have changed I believe those reasons are as valid today as they were then. If you are thinking of donating to a microcredit agency please click the link and give it a read. (Most of the links in that post are outdated. You will also see thatthere has been a change in the name from Grameen Foundation USA to Grameen Foundation.)The changes in the rules for this year’s Foolanthropy are 1) a focus on financial literacy (rather than a broad range of causes), 2) a long term commitment to that goal, 3) a concentration that will lead to greater impact, and 4) opportunities to use the knowledge and talents of Foolanthropists in addition to our financial donations.(Carrie. . . . David. . . . Tom. . . . did I get that right?)I believe all of these changes give us good reason to make Grameen one of this year’s Foolanthropies. This is how I see it. Let me know if you agree:Muhammad Yunus was a professor of economics. He was interviewing poor people in a village near his university as part of his research in economics. He was studying the finances of households. It was at one of those homes that he met the woman whose situation led him to make his first loans. Thus, the Grameen Bank began with education. With the education of its founder in the household and business finances of a poor entrepreneur in rural Bangladesh. In many senses, Yunus’ research, and, consequently, his self-education have continued ever since. And that striving for self-education through research continues at the bank and many of the organizations it has inspired throughout the world.The Grameen Foundation is continually doing and encouraging research on its operations so that they can improve their results. Two samplings of what this research has produced and is derived from are at the Foundation’s web site.http://www.grameenfoundation.org/resource_center/books_and_publications/And http://www.grameenfoundation.org/resource_center/books_and_publications/microfinance_study_links/Much of this research is used to train people in local microfinance institutions and to try to educate bankers, banking regulators, other bureaucrats, and politicians to work with and support lending to the poor. For example see:http://www.grameenfoundation.org/what_we_do/microfinance_support/technical_assistance/program_details/and http://www.grameenfoundation.org/what_we_do/microfinance_support/technical_assistance/toolbox/Training borrowers in the finances of business has long been part of Grameen’s work. Much of this is done by bringing borrowers together so each can tell the others what has worked for them. However, in developed countries, manyborrowers need more formal training. Grameen affiliates are providing that training and are continually improving it. Grameen encourages borrowers to have their children educated. The Grameen Bank has education awards for its branches. Branch banks can get one of those awards if “If all the children of the borrowers are in school or [have] completed at-least primary school.” The bank encourages children to stay in school and get university degrees. It is increasingly granting scholarships for undergraduate and graduate work. In Seattle, Washington, the Grameen Foundation has a technology center. http://www.grameenfoundation.org/what_we_do/technology_programs/There it is developing software to enable local microfinance agencies to improve their financial information and to reduce their back office costs. This should allow them to improve their operations and get more loans to poor people at lower cost. Using this software properly will require substantial training in advanced user-level computer literacy and advanced financial literacy.http://www.grameenfoundation.org/what_we_do/technology_programs/mifos_initiative/The people of the Grameen Foundation and its affiliates study for themselves and provide to others a wide variety of courses in financial literacy:1. School-boys and school-girls helping their illiterate mothers read their passbooks and loan repayment schedules. 2. Borrowers teaching each other how to be successful in their businesses3. Quick courses in the finances of businesses for borrowers4. Regular schooling which Grameen encourages for all the children of clients and which it helps make possible through the increased income families earn by borrowing for their businesses and through scholarships5. Encouragement and sponsorship of research by academics, NGOs, and governments5A. Research done by Grameen and its affiliates6. Training of finance specialists at micro-finance agencies to become skilled users of financial software, 7. Lots of stuff I’ve missed. (8. Perhaps some amazingly innovative training in financial literacy that some Foolanthropistswill volunteer to create and help deliver if the Grameen Foundation is again chosen as one of Foolanthropy’s charities.)JohnOn a personal note, although two of my favorite cousins* and their families live in Texas where one of this year’s nominees (The Plan Fund) does its work, I will still be contributing to Grameen. Mostly because Grameen covers the world – even Texas. *(All of Shakespeare's cousins are favorites. Nary an Iago nor a Lady Macbeth among them. Cordelias and Edgars all.)
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