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November 04, 2010

Building Communities through Microfinance

Ericapicc As part of our series on women in microfinance, we speak with Erica Dorn, Manager of Kiva and Volunteer Partnerships at ACCION USA. A leader in US microfinance, ACCION USA is committed to bringing affordable small business loans to microentrepreneurs. The organization has provided over $119 million in over 19,000 microloans since inception in 1991, helping to grow small businesses and strengthen the communities they serve. Here, Erica shares her story on how she became involved in the sector and her experiences in building volunteer partnerships for microfinance institutions 

Growing up, I have always been involved in community projects. My interest in this area took on a deeper meaning after Hurricane Katrina in 2005, when I volunteered with a friend’s nonprofit to rebuild communities in New Orleans. The experience of working in the devastated neighborhoods gave me a newfound understanding of poverty in the United States and the determination to solve the challenges ahead of me.

Upon my return to Brooklyn, I established The Local Universe, a community project that fundraised for redevelopment in New Orleans. As my team brought local communities together to contribute to the cause, I grew interested in creating grassroots-level development initiatives that could achieve sustainable results. This led me to pursue an unpaid, volunteer-based fellowship with Kiva, the world's first online lending platform, where I worked to facilitate stronger connections between Kiva lenders and borrowers at ACCION USA.

During my fellowship, I interviewed entrepreneurs who had received loans through ACCION USA and created online content to share their stories with the Kiva lending community. I learned that microfinance was commonly misperceived as a solution to poverty in developing countries. Unaware of poverty’s extent in the US, many of Kiva’s lenders expressed skepticism towards US-based microfinance initiatives and believed that this deviated from the organization’s mission to alleviate global poverty.

In reality, there are ~40 million underbanked US entrepreneurs, often minority and immigrant communities, with no access to loans and capital. At the same time, the multiplier effect of US-based microfinance is not to be ignored— for each ACCION loan, an underserved entrepreneur creates 2.4 jobs in the surrounding community. I believe that microfinance is a highly pragmatic and accessible solution that empowers people to strengthen and develop their communities.

Today, as the Manager of Kiva and Volunteer Partnerships, I work with my team to strengthen our volunteer force to expand the capacity of ACCION to serve more entrepreneurs in the United States. In addition to planning for the Microfinance USA conference in New York City on May 23-24, I am developing programs to engage students and campuses. Right now, we are piloting a program where students can act as “assistant” loan consultants to local entrepreneurs near their campuses. By providing students with tools to spread awareness about US-based microfinance, provide outreach to potential borrowers and help them access credit through ACCION, we hope to tap into their great energy and increase the loan accessibility in underserved communities.

 



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