Micro-Lending Group Fights Poverty by Connecting Donors with Entrepreneurs Thousands of Miles Apart

People Helping People Global (PHPG) , a Vermont-based nonprofit, has just introduced a new website that will attempt to revolutionize philanthropy as we know it. This new website allows donors from all over the world to donate directly to entrepreneurs in Central America. "Instead of writing a check to a big nonprofit and hoping that your donor dollars make their way to the right place, we’ve set up a system that allows you to choose exactly where your hard-earned money is going," said Alex Tuck, co-Founder and Executive Director of PHPG.

The system is pretty simple.

A member of PHPG investigates which neighborhoods have the highest incidence of poverty while also having a high potential for success. "We like to work in neighborhoods where other nonprofits are also helping out. If education and infrastructure are being addressed by other organizations, then there’s less to distract us from business start-ups and job creation," says Tuck.

PHPG then has meetings to inform the community about the micro-lending program and passes out applications to those who are interested.

All applications are reviewed, and each person that requests a loan is interviewed. The purpose of the interview is to meet the family, learn about their living situation, current income, educational background, and borrowing history. If the potential loan recipient falls under the lending guidelines of the organization, then he or she is added to the new website.

On the new website, donors may view pictures of the potential loan recipients and read their stories. If the donor would like to contribute to a particular entrepreneur, all he or she has to do is select the desired dollar amount and click donate. The system works just like any retail website. The donor just goes to his or her cart and checks out. After confirming the order, the donor is taken to the PayPal website where the donation is processed.

After PHPG receives the full donation amount, the organization disburses the money to the loan recipient. The loan recipient then pays back monthly payments on the loan over the agreed upon period. After the loan is repaid, the funds are used to facilitate new loans to other members of the community.

PHPG believes that they have a system that sets it apart from the organizations that currently exist in the micro-lending world. "Micro-lending started as a way for impoverished individuals to raise themselves out of poverty. Now, a lot of companies look at it as an easy way to make money. Unfortunately, it’s at the expense of the ultra-poor. Our goal at People Helping People Global is to put the philanthropy back into micro-finance," said Tuck.

Another differentiating factor for PHPG is its size and intimacy. Isabel Gamm, co-Founder and Program Manager of PHPG, tells of her experience, "Community members trust our organization, because we interact with them regularly. In a community where we work, named Avelardo Enrique, we have meetings under the mango tree. During these meetings, we connect on a personal level. We talk about success stories and how to combat problems. We grumble over the heat. We discuss bookkeeping methods, where to buy the best nacatamales, and laugh as the falling mangos whiz by our faces. Our meetings are formal yet fun. That is what separates our organization other micro-lending groups."

One of the biggest differences that PHPG has with other micro-lending groups is that it doesn’t charge interest. "We charge absolutely no interest on our loans, because we strongly believe that micro-loans requiring borrowers to pay high rates of interest often leave the borrower in more debt than when they began. Our goal is to raise communities out of poverty, not perpetuate the vicious cycle," said Gamm.

The new website may be found at http://www.peoplehelpingpeopleglobal.org. There readers may learn more about the organization, try out the new donation system, and access the organization’s social media outlets.

About People Helping People Global

People Helping People Global is a project of Building New Hope, a registered 501(c)3 non-profit organization. It partners with locals in impoverished regions of the world to develop sustainable economic initiatives. It currently focuses on providing zero percent interest micro-loans to individuals living on less than two dollars per day.