Microlending, the finance tool pioneered in the developing world to help poor people start businesses and get on their feet, is making broader inroads in the United States, says the Associated Press.
As traditional avenues to financing have dried up amid the credit crunch, a growing number of entrepreneurs, particularly among urban immigrants and minorities, are turning to the largely nonprofit providers of small start-up loans.
The number of microloans disbursed nationwide grew by 25 percent from 2008 to 2010, and some 17,000 such loans are now made annually, according to research by the Aspen Institute.
“You know this ‘Buy Local’ movement? There’s starting to be this ‘Lend Local’ movement,” says Premal Shaw, president of the charity crowdfunding Web site Kiva, which matches online donors to micro-enterprises seeking capital.