The governors of several central banks, recipients of micro-business loans and other business people from around the globe attempted to zero in on the most effective ways to get credit to the poor, as a forum on microcredit, or grassroots financial services, continued today as part of the International Year of Microcredit 2005.
A highlight of the proceedings, on the second day of the three-day forum, were testimonials of micro-entrepreneurs from developing nations whose lives have been changed by access to credit. They included Shakila Sarajulldin, an Afghani woman who – despite having tried to kill herself by self-immolation because of marital abuse – supports her three children with a tailoring business in Kabul she began with a loan worth the equivalent of $100.
Along with his partner Ernesto Silva Toledo, Milkov Machaca, a 26 year-old engineer from Tacna, Peru, produces 3,000 litres of homemade beer per month, supports five employees, and is successfully competing with the industrially-produced beer which was the only kind previously available in his area. The business began with a $5,000 line of credit.
Other speakers came from Bangladesh, China, India, Liberia, Malawi, Sierra Leone and South Africa. All nine will be given awards tonight at a United Nations Headquarters gala hosted by Tim Robbins, Jennifer Lopez and Marc Anthony, among other celebrities.
During the International Year of Microcredit, the World Bank and the Consultative Group to Assist the Poor are working with national committees around the world to host a series of events and conferences to highlight the importance of microfinance in the fight against poverty, as they also develop strategies and resources to reach an estimated 3 billion people who lack access to formal financial services.
In past decades, the World Bank says, microfinance has evolved from the provision of small loans to help start businesses to a vision of creating financial systems in developing countries where none exist.