By Suzanne Sprague, KERA 90.1 reporter
Dallas, TX – Suzanne Sprague, Reporter: Laverne Jackson sits on a tall metal stool in the back of an Oak Cliff flower shop as ribbons and pipe cleaners cascade around her feet. With a snowy television set as her only companion, Jackson is tying brightly colored bows for the arrangements she designs.
Lavern Jackson, Florist: I do weddings, corsages, and I do business for churches. I decorate churches...
Sprague: The store is small and the income is modest, but Laverne Jackson beams with pride because this is her shop, a dream she might never have realized without a $500 business loan three years ago.
Jackson: I got my lights turned on here, the certificate of occupancy, the water deposit, the telephone and all that.
Sprague: Jackson's loan came from the Oak Cliff-based Plan Fund. The six-year-old program works in low-income neighborhoods to foster economic self-sufficiency, especially among women, by issuing small business loans, called microcredit. Most of the borrowers don't have the collateral to qualify for a loan from a standard bank. But as Laverne Jackson has proven, that doesn't rule out running a successful business.
Jackson: People know where I am and they tell somebody and they tell somebody and that just keeps my business going.
Sprague: That's the type of story that makes Alberto Munoz eager to arrive at work each day. Munoz is the director of the Plan Fund, which has loaned nearly half a million dollars to low-income North Texans. Smiling broadly, Munoz boasts the repayment rate is 92%.
Alberto Munoz, Director, The Plan Fund: Last year alone we were able to create 37 new jobs in the area. We had five of our borrowers that bought new homes who had never had homes before so you start to see improvements in people's lives and that's incredible.
Sprague: The Plan Fund, which stands for Peer Lending Action Network, relies on a strong system of support. Applicants must complete 10 hours of training and join a group of fellow borrowers. If one fails to make payments, the others lose their loan eligibility. So they often work at making each other's businesses successful. Munoz recalls one example when a borrower gave birth to twins.
Munoz: And it was a difficult pregnancy. She had to stop working her business. She was not able to make the payments. But the borrowers did a mini-fair and with the money they gather form that fair, they are making her payments, so it's really about support because they are really investing in each other's success.
Sprague: The Plan Fund takes its cue from the Grameen Bank in Bangladesh, where microlending began in the 1970's. In fact, the fund operates under the control of the Grameen Foundation USA , which supports microlending outside of Bangladesh. The Foundation's President and CEO Alex Counts says, whether in First or Third World nations, microlending approaches poverty from a unique angle.
Alex Counts, President and CEO, Grameen Foundation USA: ...which is that the greatest allies that people who want to reduce poverty have are the poor themselves who not only want to get out of poverty, but in many cases have highly developed skills, you might call them coping mechanisms to keep afloat in a poverty situation, and those skills with the proper capitalization can at least can get the poor person on the right track.
Sprague: Counts says women are more likely than men to spend their profits on the long-term needs of their families, like health care and education. So most microlending targets females. In Dallas, 70% of the borrowers are women. In Bangladesh, the number tops 95%. That's partly why microlending has been championed by a host of prominent American women, from New York Senator Hillary Clinton to Dallas real estate developer Lucy Billingsley.
Lucy Billingsley, Real Estate Developer, Billingsley & Co.: Microlending is powerful to me because it's lending to women, the money is a loan so it allows the woman to rise up to her own possibilities and her own responsibilities and her own potential, to have self-esteem and become someone different.
Sprague: So when Billingsley met Alex Counts last year, she resolved to make a measurable difference in microlending worldwide. She picked a burgeoning program in Chiapas, Mexico, because of its proximity to Texas and because, as Alex Counts explains, women's needs there are so vast.
Counts: They live in extreme poverty, under $1 a day income per capita and what they want to do in Chiapas is more than double their program over the next four years to 7000 borrowers and gear up for an even larger expansion to 20,000-30,000 borrowers after that.
Sprague: To meet that goal, Billingsley, who hails from the influential Trammell Crow family, needs to raise almost $800,000. So far, she's collected about a third of that. But she emphasizes that small contributions make a big difference in Chiapas, where the average borrower receives $150.
Billingsley: If someone decided instead of buying a pair of shoes, they would give a woman the chance of a lifetime, that's really the way we want to raise the money. So, one woman at a time.
Sprague: Officials with the Grameen Foundation and the Plan Fund expect the Chiapas Project will also foster more interest in microlending locally. But the practice isn't without its critics. A United Nations report argued funds invested in microlending would be more effective if they were dispersed to broader, government programs. Supporters of microlending dismissed that claim as political. But in Oak Cliff, florist Laverne Jackson isn't too interested in the politics. She's found success and pride in a store that microcredit helped to build. And, she remains focused on the next loan from the plan fund for which she'll be eligible later this year.
Jackson: And with that next loan, I plan to get computers and get on the Internet and that good stuff.
Sprague: For KERA 90.1, I'm Suzanne Sprague.
Email Suzanne Sprague about this story.