You’re probably aware of how difficult it can be to get things started as a startup entrepreneur. It can be difficult to come up with the capital necessary to get just about anything significant off the ground. You could certainly try to take things slow, but the pace could end up becoming maddening. The same can be said in a developing country, only worse because there aren’t enough opportunities to actually earn money. It’s a problem that needs a solution because the ones that suffer aren’t just the individuals who can’t get their ideas off the ground – it’s the economy as well.
A loan is certainly a good option for an urban area with a good bank, but what about places where banks are either too far away or not there at all? This has always been one of the biggest hurdles when it comes to financing because all these great ideas could very well be a boon to their respective economies. Fortunately, microfinance has been taking steps to expand to these areas, giving people the opportunity to thrive.
Taking advantage of the situation
While there are plenty of issues that come with living in a developing region, there are some surprising benefits as well. As Sharone Perlstein (a microfinance specialist) will eagerly tell you, the cost of just about everything is a fraction of what you might have to pay normally because of the state of the economy. This means that microfinancing’s biggest advantage – flexible loans – comes into full play. Individuals who take advantage of a microloan will be able to make full use of the resources given to them while benefitting from reasonable interest rates. This allows them to get their business venture off the ground with little issue, which gives them the chance to pay the loan in full.
Microfinance gets results
While it might sound good on paper, nothing is set in stone until there’s actual data on the matter. Fortunately, Sharone’s website has the data and it’s overwhelmingly positive. Based on all the studies conducted, the repayment rate is almost at 99%. This means that almost all individuals who took advantage of microfinance options were able to pay their loans and continue their business with little trouble. While this is great for their business ventures, it’s also good news for their country’s economy.
The world needs a healthy economy to continue to thrive. Without the help of each and every country, things will be more difficult than they need to be. Microfinance is helping individuals in developing areas start their business ventures, which in turn makes their economies healthier. It’s a positive cycle that will hopefully continue to see success in the foreseeable future. For now, it’s certainly looking like microfinance could be just what the world needs right now.