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Is Micro Lending The Future Of Giving?

Posted: 12/07/07 07:40 AM ET

I met Emily Stenning while we were both studying at the University of St. Andrews in Scotland. From the moment I met her, she was constantly working on something: a committee, a foundation, a charity. To me, she is the epitome of the youth movement that we here at Living admire and believe is the future of global activism and philanthropy. Emily recently moved to India (after founding the Timau Children's Foundation Africa) and is working with Intellecap, a social investment bank, and took the time to answer some of my questions about what she does and why, and the connection between philanthropy and finance.

When did you start getting involved with activism?

Age 6 I decided that I wanted to be a Kenyan. I think it originated with an obsession with elephants but the more you learn about Kenya the more you can't escape the absurd realities that the majority of people face [there].

My first experiences of working in philanthropy therefore started in Kenya and culminated in setting up an educational based charity focused on a rural township in 2005. Up to now, (things might change in the coming election) there is no free secondary education. Orphanages can't support children forever, so a lot of time, after primary school kids go back to the streets with little more than the ability to add and, if they're lucky, the ability read basic words in English. With no job prospects their futures aren't great.

The Timau Children's Foundation, the charity I set up, implemented a number of projects to support abandoned children through secondary education. I spent about a year living in the township to figure out the most effective ways to help and establish an accountable process of using donor money. This proved to be a huge stumbling block and unfortunately the Kenyan lady I worked with and I had to eventually (after a long battle) agree to disagree and I reluctantly moved back to the UK.

And your experience in India has been different?

Working in India, so far, has been completely different but mostly because of the situation rather than anything else. Instead of a being a lone mzungu (white person) in an isolated township, I live in a bustling, cosmopolitan city where you can get everything including a thanksgiving turkey. Hyderabad is really a bizarre cocktail of extreme modernity mixed with acute poverty and ingrained tradition. My working/living conditions are incomparable to those I had in Kenya but despite the 'comforts' it is somehow harder being detached from the reality of poverty rather than being in the thick of it.


Would you say there is something in your personal history or life that lead you to work in philanthropy? I mean, other than wanting to grow up to be Kenyan?

Not so much from a particular life event but I would definitely say that a huge amount of passion and determination along with perhaps a little idealism and naivety led me to this field. I've never found it easy to turn a blind eye to what others are going through and am too skeptical of large corporate-like charities to make the needed difference so I never gave myself the choice to work in anything other than some sort of philanthropic job.


Do you have a "light bulb moment" -- a moment when you realized that you wanted to work on behalf of others?

Charity has always figured in my life but I think my definitive moment was while studying Liberation Theology. It was not only the theology of God working through the poor and the philosophy of working from the bottom up that affected me, but it spelt out the complexity of the issues and the urgency of the need for a solution. Part of my studying was focused on the growing impact of globalization on the poor, and this was really the first time I started thinking of development in terms of empowering people through mainstream solutions to help themselves.

So explain it is what you do, precisely.

I work for an Indian social investment bank called Intellecap, which is based here in Hyderabad, south central India. Intellecap started up in 2003, with the aim to create and deliver mainstream, profitable solutions to address the problems of poverty and expediate sustainable development. Really that means that we try to facilitate investment initiatives and provide a consulting service to social enterprises -- entreprises with a multiple bottom line (profit as well as a social or environmental impact). On top of this, Intellecap also creates knowledge in the area and incubates businesses itself. For example, we have an online platform called IDG which is what I am helping to set up. IDG attmepts to open up this investment space by allowing social entrepreneurs to upload their business plans online for investors to invest in. Actually, our temporary website went live last week ). My job within our team of four is to focus on the entrepreneurial side: finding entrepreneurs, encouraging them to upload plans, and developing a social rating methodology to help them realize and strengthen their social impact.


A lot of contributors to The Giving Life have been writing about micro lending. What makes it so great?

It empowers people and, if run effectively, can make 'aid money' recyclable. It bypasses the criticisms of traditional aid of creating 'dependency' and 'imposing' alien and unjustified standards Intellecap started out by focusing purely on micro-lending and is still very much involved. Two of our other incubations focus purely on microlending. One is a microfinance franchising operation called Intellecash, an all-inclusive micro-finance set-up package, the other an online micro lending site called Globefunder which facilitates lending solely within India. Intellecap itself though focuses on the mid-cap social SME space and invests in multiple bottom line enterprises whose objective is to have a positive impact on the poor.


That's a lot of really... official sounding, business-y talk. Do you feel like micro lending is a personal approach to philanthropy?

Philanthropy in general is aiming to find perfect balance between personal and impersonal. Micro lending puts emphasis not only on the social impact (the personal side and perhaps the focus of traditional philanthropy) but also strongly advocates the return on investment (the impersonal side). This two-fold approach combines the incentive to give in regards to international development but in a sustainable, scalable way. In essence making investors' money infinite as well as allowing people to help themselves. A hand up instead of a hand out.

That's interesting, especially since super personal approaches to philanthropy can come off as patronizing or pedantic, while super impersonal approach can seem like colonialism. Finding a balance between the two might be the only to make sure that respect for people in need is being maintained. Do you think this is the future of global activism?

I started as a traditional philanthropist: I raised funds and awareness and tried to understand a community to identify how a charity could help the situation. I would certainly never deny the benefits that this produces but my experience has certainly taught me the limitations of it. Working with Intellecap, seeing poverty increasing on a global scale, and the situation worsening for a lot of people, helped shape my path taking me away from that traditional approach to a more sustainable, scalable one that embraces realistic mainstream solutions. Local understanding has to be at the center of any project, but access to global investments and knowledge can help execute.


Emily asked me to include that microfinancegateway.org and microfinanceinsights.com/ are fantastic resources for people looking to find out more about micro lending and finance.