Microfinance expert: justice with loans, credit for the poor
Written by Joanne Griffith Domingue
June 24, 2007

Maria Otero touched the hearts of Synod delegates in her speech Saturday afternoon at General Synod 26 as she spoke of the power of microfinance: loaning money to the poor so they can finance their small businesses.

"This is social justice at its core," said the CEO of ACCION International, a nonprofit network in 24 countries that makes small loans to the poor. "The UCC is a church that is guided by a social justice ethic that is rooted in moral clarity. It believes that the gospel is preached even more by doing than by proclaiming."

Otero, named one of the 20 most influential women in the United States in 2005 by Newsweek magazine, lives a life of doing. She tells the story of Sophia, whom she met on her last trip to Africa.

Sophia's husband died 12 years ago. She started a business selling rice to support herself and her children. With her first loan of $50, she bought two 100-kilo bags of rice, repackaged them into smaller bags and sold them in her village.

"Today, many loans later, her business has grown to employ several people, and she sells significant quantities of rice, ground nuts and beans," Otera said. "Sophia is proud of her business… But her eyes really shine when she talks about her two daughters – who are at the university."

This seems like a small story, Otera said. "But played out over and over again in markets, slums, barrios and villages around the world, this is a compelling and inspiring story of resolute perseverance; of the power of the human spirit; of the dignity needed to overcome the enduring grasp of poverty.

"Good things can happen when you put small amounts of capital in the hands of poor people," she said.

Otero, 56, a mother of three, was born in La Paz, Bolivia, one of nine children. When she was 12 her family moved to the United States, where her father, a lawyer, came to take a position with the Inter-American Development Bank. Otero has degrees from the University of Maryland and Johns Hopkins University.

After working around the world, Otero decided she wanted to focus on helping women empower themselves through work so they can be leaders in their own lives, she said in an Oct. 24, 2005 article in Newsweek magazine. "ACCION allowed me to realize my dream," she wrote.

ACCION began making micro loans in 1973 in Recife, Brazil, to poor people coming from the country to the city. By 1980 ACCION was in several countries. It created a way to make loans to people with no collateral. They charged interest to cover costs and created incentives to pay back the loans. "Soon we had 1,000s in line waiting to borrow."

Loans average about $600 and 97 percent of those loans have been repaid – "Something most banks in this country would covet.

"There were plenty of naysayers. They said you can't have banks for the poor. The poor don't pay back. They don't know how to use the money. We proved them wrong," Otero told an audience applauding the good news.

Increasing access helps people see themselves differently.

On a recent trip to Peru, Otero visited some women who had received micro loans in the 1970s to run their own market stands. "They had nothing," Otero said, "only what their husbands had given them." And they had their dreams.

"Here we still are," they told Otero. "They took enormous pride in what they accomplished, with their children. These women no longer consider themselves poor. They have enormous pride. They have lifted themselves up."

Microfinance is a tool that taps into the dignity of every person and helps make a modest dent in the battle against poverty, Otero said. "It is not a panacea, but certainly an approach that is changing the lives of the poor… These women wash God's grace over me."

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Rev. J. Bennett Guess
Executive Minister, Local Church Ministries
700 Prospect Ave.
Cleveland,Ohio 44115
216-736-3801
guessb@ucc.org