Back in August, while I was visiting that Mexican village that is so close to my heart, I spent some time with one of the kids I met when I first went to that place. Adiel was one of the “lucky kids” of the village. His family, due to his sister marrying well, was able to pay for his university education. He is one of the few. All of the other children talk about university education as if it is a distant dream. It’s almost like when kids hear speak of being famous celebrities. It would be nice, but the chances of it actually coming to pass are very small.
But because of an innovative use of microfinance that builds on the peer-to-peer “citizen effect” model of lending, students like Howard (see the video above) and those I know in Mexico have access to something we take for granted in the states: a student loan.
As I was talking with Kushal Chakrabrati, CEO and Co-founder of Vittana, an organization that facilitates education microloans for students pursuing university study, it was obvious to me. So many students want the opportunity to study. Much like the stars of microfinance- entrepreneurs in the developing world-these students just need an investment to empower them in their education and future careers.
Through Vittana, 11 people gave Howard, a Nicaraguan student studying law and business management, the chance to succeed. 11 lenders invested in Howard’s future with loans as small as $25. He was able to pay for the remainder of his schooling in addition to the graduation fees. He can now study without having to worry about how he is going to pay for school. 11 individuals made this happen. You can catch the second part of his story here.
Sue Braiden, from Ontario, Canada was drawn to Howard based on his obvious commitment to his community. “I could see a fire in his eyes as he shared his desire to help others further down the line,” she said. Sue was also impressed with the caliber of staff that Vittana boasts. “I sent out a tweet inquiring about Vittana and Kushal responded and was willing to call me and discuss Vittana,” she shared, “I love that you are able to have such a deep personal connection with the people behind it.”
Chris Cuellar, a Chicago resident and another one of Howard’s lenders says that the Vittana lending experience has been great and rewarding. When discussing his investment in Howard, he said, “This micro-loan was a small portion on my part, but through Vittana, many people’s small portions can add up to make a large impact on someone.”
How Vittana Works
Our contributor, Naiomi, wrote a piece about Vittana back in November, and even since then this group has grown significantly. Currently operating in Mongolia, Nicaragua, Paraguay, Peru and most recently Vietnam, Vittana links lenders with students pursuing careers in accounting, medicine, law, education, and any other field of study you could think of. And they are continuing to expand.
As a reminder, Vittana operates on two levels. First, the Vittana team works with microfinance institutions (MFI) partners to develop an effective student loan program. They seek partners who have considered student loans as a part of their next five-year strategic plan. Once created, the MFI partner has full ownership of the student loan program. For several of the MFIs, the selected students are actually children of the entrepreneurs who have received loans. Because student loans don’t permit for the weekly group meetings that usually come with an effective microfinance program, the parents (typically the mothers) serve as those vouching for the students.
Second, through their website, Vittana creates a truly global community, providing the way for the individual to be involved in the process of empowering these students. But there’s something slightly different about this peer-to-peer platform.
The typical peer-to-peer website posts a photo and a story about the client you’re investing in. Every so often you’ll receive an update on repayment and the client’s business. These stories are the very power of the peer-to-peer format. However, Vittana, because their clients are students, are able to make this connection a bit more personal. Many of the updates are actually made directly by these students. Lenders are able to connect- actually connect-with the students they invest in. “Many of the students are on facebook, hi-five and other social networking sites. They’re online, so they can actually have relationships with their lenders,” Kushal said.
Listening to the Voices of Microfinance…Together
If you speak to those benefiting from the traditional microloan, you’ll hear stories of mothers who want the resources to send their children to university. Many are growing their businesses to create a brighter future for their children. And through Vittana, individual investors, who too believe in the power of education, are coming together to practically support these students’ ambitions. “It was time we actually started listening to these entrepreneurs,” Kushal said. “So we provided the platform for people to do so. And it has been truly powerful.”
And with the access to student loans, these “children of microfinance” are becoming accountants, lawyers, business professionals, journalists, doctors, and professors. They’re now able to help their families by earning sustainable incomes.
Vittana is building a global movement- one that makes real-life, practical sense. Individuals who believe in the power of investing in other individuals’ education can actively engage in a global community that is taking microfinance to the next level. This concept actually uses microfinance to provide people with the access to even greater income sources, going beyond the “bottom wrung of the ladder”.
I think of the kids in Mexico- Valerio, Gener, Rubisel, Ruth- and how radically different their lives would be if they had a chance to go to school- and how their communities would change for the better. Empowering the individual- both lender and student- through effective microfinance program development and real relationship connection. The strategic logic and energy for excellence behind this effort cannot be missed. Through Vittana, lives are transformed. And they’re inviting you to join with them.