Invest in Education, One Loan at a Time
This is an excerpt from Beyond Profit Magazine's October issue.
We are all well acquainted with microfinance 1.0, its successes and failures. What will microfinance 2.0 look like? Probably a lot like VIttana, a new platform that is taking microfinance to the next level, dispersing student loans in the developing world.
While microfinance has done much to help its borrowers build businesses, give their children new opportunities, their children are now growing up, finishing high school, and thinking about college. The problem: student loans just aren't available in the developing world. Why? A loan to a college student bears no immediate promise of repayment. Vitanna hopes to demonstrate that students are as good a risk as any other microfinance borrower.
It's no wonder that the Huffington Post named Vittana number one of their top 10 "game changers" in philanthropy!
Vittana's website is at www.vitanna.org, and this is how it works: When you make a loan to a Vittana student, 100% of your funds go to the student. Using your loan, the student finishes college (or vocational school), gets a degree and then gets a job. When the student repays Vittana, Vittana repays you the full amount of your loan — if you lent $25, you are repaid $25.
We are all well acquainted with microfinance 1.0, its successes and failures. What will microfinance 2.0 look like? Probably a lot like VIttana, a new platform that is taking microfinance to the next level, dispersing student loans in the developing world.
While microfinance has done much to help its borrowers build businesses, give their children new opportunities, their children are now growing up, finishing high school, and thinking about college. The problem: student loans just aren't available in the developing world. Why? A loan to a college student bears no immediate promise of repayment. Vitanna hopes to demonstrate that students are as good a risk as any other microfinance borrower.
It's no wonder that the Huffington Post named Vittana number one of their top 10 "game changers" in philanthropy!
Vittana's website is at www.vitanna.org, and this is how it works: When you make a loan to a Vittana student, 100% of your funds go to the student. Using your loan, the student finishes college (or vocational school), gets a degree and then gets a job. When the student repays Vittana, Vittana repays you the full amount of your loan — if you lent $25, you are repaid $25.
This is a great model of microfinance thinking about whats next in a newly educated person. There are great websites such as Kiva that assist entrepreneurs with loans so they can change their lives by becoming financially independent and sustainable. But Vitanna is the next step in the development of these newly sustainable families.
