Quote:
Originally Posted by Robert-TG";p="
While I agree it is a good idea...I have to laugh that the Major banks have never thought of lending money to the POOR. When you have money the banks fall all over you to get you to borrow money from them. But when you have no money the banks don't want to know you.
So Muhammed gets the Prize for, INVENTING the concept of loaning money to the poor.
Sorry, I'm still laughing, that this "concept" needed to be invented. LOL 
I sure hope his theory works. He has put his theory into practice and good on him for doing so. I sincerely wish him every success.  
I can only hope the major banks learn the new radical concept that poor people need money to get started! |
This is not about the poor in America and Western Europe (though the principles may still apply) but for third world villagers with no collateral and no money who are initially seeking EXTREMELY small profits off something like, say, a couple bamboo chairs.
The theory works as a way to jumpstart third world craftsmen... but it is very difficult to make profit off of. That leads to the microcredit banks often being dependent on contributions.
Alos note that banks' "efforts to help the poor" in the US tend to revolve aroud geting them to pay waaaaaaay more in the long-run. Microcredit is essentially a charity based on long-term improvement on poverty rather than long-term debt. Yusun encourages the third world poor to use their profits to educate their children and make good future investments... while banks loaning to the poor in the West tend to focus on convincing the poor to live beyond their means and pay for it later.
As much as micro-credit uses free market forces, it is a charity concept overall.