MICROFINANCE

 

"However, there should be no poor among you, for in the land the Lord your God
is giving you to possess as your inheritance, he will richly bless you.  If only
you fully obey the Lord your God and are careful to follow all these commands
I am giving you today...There will always be poor people in the land.  Therefore
I command you to be openhanded toward your brothers and toward the poor
and needy in your land."

Deuteronomy 15: 4-5, 11

CURRENT MINISTRY OPPORTUNITIES/NEEDS

    Microfinance Factors

    Microfinance is aimed toward permanently lifting people out of poverty, while increasing the economic power of poor people and poor communities.  Although this type of finance program has largely been tried in the Third World, some finance ventures are using this type of finance program in the United States.  The results have been mixed, but we can learn from both the successes and failures.  The aim of this ministry is to spin off a separate for-profit corporation that will be independent of the church.

    This ministry will clearly identify the goals of the future corporation and how they relate to Scriptural principles.  This ministry will identify a strategy that will be used to acheive these goals.   The ministry will also be set standards and operating guidelines based both on biblical principles and sound finance practices before turning the operation over to the future corporation.  For a further explanation, please see the Pastor's Note below.  We are praying and need business and finance professionals.  Make this a matter of prayer.  This is an important and serious ministry.  If you are interested in such an email, please contact us.

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PASTOR'S NOTE

    Microfinance is a social ministry with tremendous promise.  However, the results have been mixed for various reasons.  First, after the initial formation, it must be independent of the church.  Secondly, it must be a profit making venture.  Profit making does not mean ungodly as people sometimes believe.  However, the purpose of microfinance is ministerial.  Essentially microfinance seeks out poor people forming businesses to make small loans.  In the United States the loans rarely exceed $25,000 and usually run between $5,000 to $25,000.

    How do we envision starting this ministry?  First, we need to form a group that will ultimately launch this corporation.  A study will be made of biblical issues concerning money, poverty, and social justice combined with a study of past microfinance successes and failures.  Secondly, goals will be formulated and a strategy devised.  Thirdly, the corporation will be formed independent of the church.  Decisions will be made independently and the church will have no formal connection to the corporation.  To be successful a microfinance venture must be a profitable venture.  To be true to its spiritual goals, it must empower poor people and the communities in the Inland Empire.  These goals are compatible.  Fourth, the corporation must attract investors from the private sector.  Many banks have given seed grants and other funds to such ventures.  Fifth, the corporation must operate effeciently but compasionately.  The church will be a resource for compasionate operation.

    The major reason these ventures fail is they forget they are meant to be profitable business ventures.  Yet, there are times that Christians must meet basic needs without loans.  These people will be referred to the church for care.  All loans made be a microfinance venture must be made with a reasonable expectation that they loans will be paid back.  Yet, typical credit scoring systems eliminate the typical poor entrepreneur.  One urgent task is to develop a new credit scoring system.  The system needs to be objective and rational to identify poor entrepreneurs who are good credit risks.  Biblically, the interest rate must generate a profit to sustain and expand the microfinance program, while not gouging the clients who have less ability to find competitive loans. 

    Obviously, this is a serious business venture, not a charity.  Yet, biblically, this venture can greatly honor God and empower the poor.  This program has serious need of business professionals.  This microfinance venture needs finance professionals with experience in risk analysis, credit scoring and analysis, loan monitoring, small business formation, marketing, hedging, people with experience in the collection process, social workers, and others with business and/or social work expertise.  This is an exciting ministry that can really impact our area for Christ.  If you are interested in a large and real ministry, please contact us. 

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