Bootstrapping a life

Filed in archive Bootstrapper Resources on October 12, 2007

John Casper at MSN Finance has these observations about A Million Bootstraps, the book on microcredit philanthropy from Tulsa business man Phil Smith and microcredit guru Eric Thurman.

Microcredit, loosely defined, can be described as:

...getting small, short-term loans into the hands of people who wouldn't otherwise have access to capital, and showing them how to use that capital to lift themselves out of poverty.

Here are the highpoints from Casper's observations:

• Microloans are often small by comparison with the loans from large finanial insistutions
• Many may be as small as $100 with a term of six months
• The amount needed to lift someone from poverty is about equal to annual per capita income in the borrowers country
• That amount can be as little as $120 in places like the Congo
• The loans could be repaid and reloaned 20 times within a 10 year period
• The loans effect everyone in the borrower's household, perhaps five on average in developing countries
• A well invested $120 loan can change 100 lives over a decade

Casper's excited about the idea of microcredit or microfinancing and I have to admit I find it intoxicating as well.

More than philanthropy, the process sounds like the introduction of a kind of global bootstrapping principal that could ultimately change the economic climate worldwide. (Read more)