Latest Release of Open Source Software for Microfinance Includes Support for Spanish and Firefox 3.0 Browser and Interface for Banking Systems
SEATTLE, Jan. 20 /PRNewswire-USNewswire/ — Grameen Foundation announced today the latest release of Mifos, its award-winning open source software platform for microfinance. Mifos 1.4 is the first version available in Spanish and also provides support for Firefox 3.0 and integration with banking and other systems. This marks a significant step forward in extending an open platform that gives the entire microfinance industry cost-effective access to technology.
Engineers at Grameen Foundation’s Technology Center in Seattle worked closely with its global community including corporate volunteers from SunGard Technology Services, as well as individual technology contributors from the United States, Europe and Australia to build the new features and additional product scalability. (more…)
Microfinance has grown tremendously in the last decade, moving from little NGOs working in tiny villages to large institutions providing loans, savings accounts and insurance to hundreds of thousands of poor women and men. Grameen Bank in Bangladesh alone has more than seven million clients, while institutions like Grameen Koota in India serve more than 300,000. In fact, according to the Microcredit Summit Campaign there are more than 3,300 microfinance institutions (MFIs) providing services to more than 155 million poor people and their families globally.
As these MFIs have grown, so has their need for technology to help them manage their overall business operations. Technology plays a key role in Grameen Foundation’s mission to alleviate poverty. From equipping MFIs with the capacity to manage technology to building and delivering industry-wide solutions like the Mifos™ platform, our goal is to advance the use of technology so all MFIs can better serve more of the world’s poor.
We have seen a promising shift in technology use among MFIs over the past five years. Surveys by theConsultative Group to Assist the Poor (CGAP) show that the share of MFIs leveraging technology to manage their operations grew from less than 50 percent in 2004 to roughly 72 percent in 2009. Still, we believe the spread of technology can be accelerated in two significant ways…
The Hindu News
Washington (PTI): Two identical bills have been introduced in the
US Senate and the House of Representatives to award Congressional
Gold Medal to Bangladesh’s Nobel Laureate and Grameen Bank fame
Dr Muhammad Yunus.
Congressional Gold Medal is the highest award conferred by the US
Congress. So far only a few international personalities,
including the Dalai Lama, have been bestowed with this award.
The Senate Version of the Bill (S-846) has been sponsored by
Senator Richard Durbin and co-sponsored by 55 others, while the
House of Representative Bill (H R 2000) has been introduced by
Congressman Rush Holt and cosponsored by 29 others.
World Mag
Finance: Grameen Bank and microfinance guru Muhammad Yunus came to America just a year ago with ideas—an success stories—on how the poor can survive a credit crunch | Emily Belz
NEW YORK—There he was—silver-haired and in a Bengali tunic—arguably the most popular banker of the year in New York City. As soon as he stepped out on the street in Queens, vendors at an outdoor market abandoned their wares—necklaces, a cart of Italian ice, rice pudding, and yards and yards of saris—to get a picture with him and shake his hand. Muhammad Yunus, the 2006 Nobel Peace Prize winner for his development of a microfinance model that has spread around the world, is as famous as a rock star among Asians just about anywhere. He offered high fives and hugs in return.
Yunus, who turns 69 this month, brought his revolutionary model to New York just over a year ago. Grameen America, a microfinance bank that provides loans to low-income entrepreneurs, is “banking for the unbanked” as its slogan goes.
“And ka-ching I take your money . . .” boomed a stereo system out over the crowd playing “Paper Planes” by Sri Lankan rapper M.I.A.
This is not a good year to be in the credit industry—unless you are Yunus. His U.S. bank has distributed $1.5 million in loans to small business owners in its first year while enjoying a 99.5 percent repayment rate. Yunus has said “you need a dollar to earn a dollar,” and Grameen offers the first dollar—tiny loans that the poor can repay and build their own businesses, one week at a time. (more…)
Sun Microsystems
Best Java Technology for the Open Source Community
Competing amongst some of the most innovative and powerful Java technology-based applications, Mifos was selected by James Gosling, Vice President and Sun Fellow, as the 2009 Duke’s Choice Award winner for Best Java Technology for the Open Source Community. We will be accepting the award at the JavaOne 2009 Conference taking place in San Francisco, CA:
Listen to an interview with Sam Birney live on JavaOne Radio on Thurs June 4 at 12:00pm
Watch Van Mittal-Henkle accept the award on-stage and give a demo during James Gosling’ keynote session on Friday June 5 at 8:30am.
Read the full press release issued by Sun Microsystems. (more…)
The Daily Star
BEIRUT: The microfinance industry in Lebanon is considered to be relatively small and is estimated to have a potential of 190,000 active borrowers, Ziad Halabi, general manager of Ameen s.a.l said on Friday. “As of end 2008 the market consisted of 54,000 active clients, which means that only 28.4 percent of the market has been served, so we still have a gap of 71.6 percent in the market,” said Halabi during a conference held at Haigazian Univerisity in Beirut. The conference aims to discuss the importance of the microfinance industry in Lebanon and the challenges facing it in addition to the potential of its future growth.
Halabi based these figures on a study prepared by Grameen Jamee Foundation in 2008.
Ameen is a non-profit organization which provides small loans to very small merchants, farmers and industrialists.
He admitted that reaching the 140,000 potential clients target is not easy given the amount of work needed for this type of business. “It is very difficult to grow that much in a short period of time. So we are trying to build our internal capacity to be able to hire more people, manage them and outreach more clients,” he said. “Our business grew over 40 percent in 2008 so we needed to hire 35 more people and train them. Outreaching to the 140,000 clients might need an additional 1,000 staff members, that’s why we need to work on our internal capacity and this is one of the main challenges we are facing,” he added.
Microcapital
Latin America – Caribbean Regional Microcredit Summit, June 8-10, 2009, Cartagena, Colombia.
Summary of Event: This is the 13th Microcredit Summit since the first summit held in Washington DC in 1997. The summit will offer the opportunity for microcredit practitioners, advocates, investors, donors, non-government organizations, financial institutions and those committed to the summits’ goals to assess progress, address challenges and discuss strategies for achieving the 2015 goals. Delegates will also come together to share microfinance best practices and network. The conference will be in Spanish and English depending upon the workshop session.
See Our Comprehensive Event Calendar Here: http://microfinanceassociation.ning.com/events
Cost: Registrants from Latin America and the Caribbean USD 250; all other registrants USD 300. This excludes 16 percent tax and must be paid in USD. This includes all sessions (seating may be limited), closing dinner and all lunches. This does not include field visits and day-long courses post summit. (more…)
BBC News
By Salim Rizvi, New York.
Tahmina Maya is a 45-year-old New York woman of modest means.
But in the past 12 months, she has been able to get a loan to start a business and make the regular weekly repayments on time, while many Americans are struggling to pay off mortgages and credit card debts.
And she’s not the only one.
Despite the ravages of the global financial crisis, one bank in the Big Apple, Grameen America, has been making its mark with a business model that specifically aims to help the least fortunate. And while its rivals struggle with the consequences of sub-prime mortgage lending, Grameen America stands out with a loan repayment rate of more than 99%.
Tahmina came to the US from Bangladesh 11 years ago. After her husband died three years ago, she had to struggle to bring up her two children. A year ago, she took her first loan of $3,000 from Grameen America bank to start a small clothing and ornaments business. Now she has taken two loans of $3,000 and has been repaying the loan instalments on time every week, as well as taking care of the family. (more…)
CRI English.com
A microcredit program, aiming to give small loans to families in quake-hit Sichuan province, has started in Beijing.
Called ‘Danone Microcredit Foundation’, the project is a cooperative project between three parties, namely the State Council Leading Group Office of Poverty Alleviation and Development of China, the Grameen Trust and the Danone Group from France.
The project will help finance local people in the earthquake affected area to rebuild their ruined homes and restart businesses.
It was designed to replicate the famous Grameen Bank program, which has been practicing in Bangladesh for over 30 years and has released about 5 million Bangladeshi people from poverty.
The French Danone Group offered a total of 20 million RMB to establish a fund to support the project.
Grameen Trust, the sister agency of Grameen Bank, will help to supervise the operation of the fund.
Dr. Mumhammad Yunus, founder of the Grameen Bank attended the opening ceremony of the project in Beijing. (more…)
Miami Herald
Dear EarthTalk: What is “microfinance” and how does it help poor countries and preserve the environment?
- Eliza Clark, Seattle
The brainchild of Grameen Foundation founder Muhammad Yunus, microfinance is a form of banking whereby financial institutions offer small loans to the poor. The idea behind the concept, which originated in Bangladesh in the mid-1970s, is that motivated and disciplined poor people could climb out of poverty if they had access to funding – even small amounts – that help get businesses off the ground. With access to revolving loan funds, these “micro-entrepreneurs” can build businesses, pay back the borrowed money, and continue to provide for themselves and their families in a sustainable manner.
A classic example would be a woman who borrows $50 to buy chickens so she can sell eggs to other members of her community. As her chickens multiply, she can sell more eggs, and eventually she can sell chicks as well. She pays back the money and has climbed out of a perhaps desperate situation financially – and the community benefits from having a new source of nutritious food. (more…)
AD HOC News
Ludwigshafen, Germany – March 5, 2009 – BASF SE and Grameen Healthcare Trust have announced the establishment of a joint social business venture. Dr. Jürgen Hambrecht, Chairman of the Board of Executive Directors of BASF SE, and Dr. Muhammad Yunus, Nobel Peace Prize Laureate and Managing Director of Grameen Bank, signed an agreement in Ludwigshafen to establish a joint venture called BASF Grameen Ltd.
The purpose of the company is to improve the health and business opportunities of the poor of Bangladesh. BASF Grameen Ltd. will start by utilizing two products from BASF’s portfolio: dietary supplement sachets containing vitamins and micronutrients, and impregnated mosquito nets that offer protection against insect-borne disease.
Social commitment with an entrepreneurial twist
‘Our social business joint venture is intended to empower people to take part successfully in business life,’ said Hambrecht. ‘The more people who do so – be they business partners, customers or employees – the better the economic and social development of a country and its population. Investing in people’s entrepreneurial skills is therefore part of corporate responsibility.’ Social business is a new business model for BASF.
Today, Grameen Trust, international affiliation of Grameen Bank and Fundación Carlos Slim AC, announced the new alliance Grameen-Carso which will donate micro credits to the neediest people in Mexico. Grameen Trust and Fundación Carlos Slim will have equal investments in this alliance and will start operating in areas with higher rate of poverty in Mexico.
Fundación Carlos Slim will provide an initial assets of 5 million dollars and guarantee other 40 million dollars for credit lines of this strategic alliance. Grameen Trust will be the manager of this alliance with experienced people in micro credits brought from Grameen Back. In the long run, Green’s managers will capacitate local managers in order to be in charge of procedures in Mexico.
Grameen-Carso will confer micro credit lines with lower interest rates than other micro credit suppliers in Mexico. This project will be a social company; all the profits will be re-invested in order to increase its operations…{click this link to read the rest of the article}
WASHINGTON, DC, October 13, 2008 – The American Red Cross and Grameen Foundation are expanding their partnership to bring additional microfinance services to further alleviate poverty and revitalize communities in the tsunami-affected province of Aceh, Indonesia. This new initiative will enable YAMIDA, a Grameen Foundation partner microfinance institution, to open its first branch offices in the Aceh Jaya district, one of the poorest areas in Aceh.
“Our microfinance program will use loans and additional safety nets such as saving plans to help generate livelihoods and incomes for women, an essential component of sustainable recovery in tsunami-affected communities,” says Gerald Anderson, senior director of the Tsunami Recovery Program for the American Red Cross. “The expansion of this partnership will help increase income for women to provide housing, nutrition, healthcare, and education for their families…{click this link to read the rest of the article}
As financial markets struggle internationally, some microfinance institutions (MFIs) have begun to see downstream effects in the form of rising lending rates. Royston Braganza, chief executive officer of Grameen Capital India observed “the demand for funds is high because microfinanciers have drawn up aggressive growth plans” and “the cost of funds remains a concern due to the 2 percent increase in just the last quarter.” These factors could make fundraising very difficult for microfinance institutions in cases where they have not built up proper reserves according to K. Vinod Kumar, Assistant Vice-President of member services at SKS Microfinance.
Despite these calls for concern, some key microfinance practitioners and advocates are publicly voicing their support for microfinance as a stable alternative investment. Muhammad Yunus of the Grameen Foundation said, “The financial crisis has not hit the microfinance system” and that “in the middle of all these bad news: microfinance still works.” Bill Clinton said last week that investors should “consider the poor of developing nations as viable investment alternatives to today’s turbulent markets.”… [click this link to read the rest of the article]
BANGALORE: Nobel laureate and founder of micro-finance giant Grameen Bank in Bangladesh Muhammad Yunus today said borrowers of the bank were keen to pick up 20 per cent of the shares on offer in the initial public offering of his country’s biggest mobile phone operator Grameenphone.
Speaking at a function here, the Nobel Peace Prize winner said: “20 per cent should be reserved for borrowers of Grameen Bank.”
Grameenphone is a joint venture between Grameen Telecom, owned by the bank, and Norwegian telcom company Telenor.
He said the allotment can be made to a trust to be formed by the borrowers, who had the financial capability to buy the shares… [click here to read the rest of this article...]
The Grameen Bank is owned by the people who borrow from it. At a Microcredit summit, 11 groups have agreed to report their annual interest rates. A move that may help to keep with sectors charitable roots… [click here to read the rest of this article...]
BUSINESS STANDARD
Grameen, IndusInd, SKS, come together in India in $29milUS transfer
Press Trust Of India / Mumbai 2008
Three leading institutions, IndusInd Bank, Grameen Capital India and SKS Microfinance, today announced the closure…
This interview was undertaken in Cape Town, South Africa between the co-founders of The MiFi Report.
Nick: Could you describe Microfinance in one sentence?
James: Microfinance is the practice of providing the financial tools that you and I take for granted every day, such as credit, savings, insurance, etc., to those affected by extreme poverty.
Nick: Can you describe the tools you referred to for providing microfinance in a bit more detail?
James: We have seen in recent years that microfinance institutions have been popping up all around the world, providing loans to low income entrepreneurs that may have a good business venture but lack the access to funds that you or I would find at any bank on any street corner.
Nick: What is the history of microfinance?
James: Well, the history of microfinance isn’t a very long one. Many attribute the beginning of the formal practice to a man out of Bangladesh named Mohammad Yunus. Though others around the world had been using microfinance on a less formal scale, he began giving agricultural loans in the 1970’s and grew his “experiment” into one of the largest microfinance institutions in the world, the Grameen Bank. In fact, you may have heard that he won the Nobel Peace prize in 2006 for his work in the field of microfinance.
Nick: Wow, so it is that recent?
James: Actually, yes. The field is very young, and it has only been in the past few years that people around the world have started to become aware of the incredible potential that microfinance has in assisting the poor. Though it isn’t a panacea for the issues of the developing world, not by a long shot, many have pinpointed it as becoming the most efficient and effective tool in poverty alleviation. Of course, this is only the case when microfinance institutions around the world, known as MFIs, behave responsibly and remain socially aware of their economic impact.
Nick: How much is the typical interest rate that the client has to pay back?
James: These loans are quite costly for an institution to undertake, considering the logistics of loan disbursement, marketing in rural areas, and loan collecting. Also, as you can guess, microfinance institutions must deal with perceived risk when the access funding. The interest, as you can assume can be quite high due to these factors, with banks and funds, in many cases, requiring 25-45% interest back.
Nick: Wow, I guess I see why, but that is really high, don’t you think?
James: Well before working in the sector, like you, I thought it was highway robbery, but the truth is that just the overhead fees for making a $10,000 loan is the same for making a $200 loan. You still need the same amount of staff to make each loan. You still need the same technology and resource capacity to keep track of either loan and to transfer the funds. So lending a lot of small loans out, without even taking into account the risk involved, is expensive.
With regards to risk, the initial risk may be high as individuals may be unfamiliar with the practice and some do not understand the importance of not “killing the golden goose” by taking out a $500 loan that they never pay back, only to later realize that if they had paid it back, their venture could have had an infinite stream of credit.
So the most established and efficiently run MFIs are able to educate their clientele base and iron out the details of their operational costs in order to lower their interest rates significantly.
And here is the kicker… the well-run MFIs around the world have been able to post repayments rates between 95-97%! That rate is higher than credit card payments or student loans in the U.S.!!
Nick: That’s incredible! And to think, microfinance wasn’t even around 30 years ago!
James: I know. I think about how it has taken us so long to see the bottom rungs of society as a viable market, and I’m just glad we have stopped ignoring them.
The truth is economists have only recently started to widely recognize that one of the most integral factors in creating wealth is access to credit. It is now no secret that the “trans-generational” aspect of extreme poverty has existed because the poorest of the poor previously had no access to reasonable credit; meaning that the poor stayed poor because they never made enough money to save any of it for future investments. So, the risk of opening up a business was quadrupled by the fact that to do so, the person had to take out a loan from the ruthless loan shark up the block.
Nick: Well, you mentioned donations and aid… wouldn’t donations still be better than loans that the poor have to struggle to pay back?
James: That’s a very common question. Two things come to mind though. First, some estimates say that 4 billion people, out of a total of 6 billion total, live on less than $2 a day. That’s “billion” with a “b”! These people live in extreme poverty, and donations will never meet this immense demand.
The fact that donations or aid will never meet that demand, is not an entirely negative thing. Through working in microfinance here in South Africa and in Nicaragua, I have seen firsthand, that loans for revenue generating businesses are often more effective than donations because they encourage financial responsibility and the loan comes with market-driven incentives to invest the money in their business instead of using it for consumptive purposes.
Furthermore, the loan, if used to generate income through some venture or another, will be worth more than the immediate value. Meaning that a $100 loan that is used to buy a toaster for a sandwich shop in Chiapas, Mexico, will add value to the client’s products, since now they are toasted, and in turn may generate, say $500, of extra income for that year.
Nick: I think I understand, but can you explain that a little more?
James: So, when I say that with a loan comes responsibility and added incentive, I mean that Juanita in Chiapas will use the money more responsibly if she knows that she will need to pay that loan back; that is, if she ever wants a loan from that microfinance bank in Chiapas again. She will be less likely to spend it on immediate consumption if she knows that she will need to start making installment payments on her outstanding loan soon. Also, there will be added incentive for her to really put that money to work because she understands that if she doesn’t pay that loan back, then the MFI servicing her village in Chiapas will not give her the next loan she is already planning on getting to get a second toaster in order to satisfy the masses that have already heard about how good “Juanita’s Toasted Sandwiches” are.
Nick: I wish Juanita’s Sandwich Shop was around here. I’m getting pretty hungry…
James: You see, the beauty is that there is woman or man in a village or township only so far away from us, just like Juanita, that will soon realize that their neighborhood could use a good sandwich shop like the one that he or she does not even know about in Chiapas. And you know what he or she is going to do in order to get the funds to buy a toaster?
Nick: Ah… Go get a loan from an Microfinance Institution!
James: Precisely. And to think, it wasn’t long ago when he or she would be forced to take out a loan with a loan shark for an interest rate that he or she would spend years paying back.
Nick: Thanks, James. Hearing about it makes me think microfinance is going to be revolutionary, and when it becomes as big as I think it will be, I will be glad I invested in this site with you, haha!
James: Hah, I’m glad you think so, Nick, and readers, if you enjoy our site, please support us by supporting our sponsors. Thanks!
