MICROCAPITAL STORY: St. John’s University Announces a Student-Run Global Micro-Loan Program

St. John’s University’s Peter J. Tobin College of Business is introducing a student-run Micro-Loan Program that actively engages students in international finance. The initiative is being led by Ph.D. Dr. Linda Sama, St. John’s Associate Dean for Global Initiatives. Dr. Sama says that the program, which is scheduled to launch during the Spring 2009 semester, marks “the next stage in business education on the global level.” The program is also in line with St. John’s mission which includes “using the university’s intellectual and physical resources to search out the causes of poverty and social injustice and to encourage solutions which are adaptable, effective, and concrete.” The program has two goals: to explore the utility of microcredit as a tool for combating poverty in locales where banks are virtually non-existent and to expose students to the challenges of lending and collecting money in the developing world.

Qualified Tobin College students admitted into the Entrepreneurship elective will have an opportunity to participate in the Global Micro-Loan Program. The students will set up a website where donors can submit online donations that will be disbursed as microloans. The Daughters of Charity (DOC), a Catholic women’s charity organization, will act as field partners. The DOC has a local presence in 72 developing countries and will represent the program in the local communities and will handle the distribution of loans and collection of loan payments worldwide. Initial applications will be approved by the DOC. Donors may submit donations, in denomination s of USD 50 to USD 1,000, online. In addition to assisting IT in the design and maintenance of the program website, the students will monitor loan repayment and fees, develop marketing strategies, and assist in monitoring lending risk and developing business plans. The web-based business model is very similar to that of Kiva.org or Opportunity International’s OptInNow, both of which MicroCapital has reported on in the past. Longer term plans include having students actively seek out donor lenders as well as creating a Student Fellows Program that would allow the students to meet the microentrepreneurs in order to assess the impact that the program and microcredit have had on their lives.

While Daughters of Charity has a local presence in 72 developing countries, Tobin College’s initial program launch will occur in just a few countries. “Ethiopia, Bolivia, Nigeria, and Northern Nigeria have been recommended as countries where technology is available, English is spoken, and the Daughters of Charity have a presence,” says Dr. Sama.

By Iyanna Holmes, Research Assistant

Daughters of Charity

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