Friday, October 14, 2011

UK Upper Tribunal Rejects Part of Charity Commission's Guidance on Fee-Charging Schools

ThirdSector reports that the United Kingdom's Upper Tribunal has rejected in part an attempt by the Charity Commission for England and Wales to require schools seeking classification as a charity to admit students who are unable to pay the schools' fees.  While the Upper Tribunal accepted that given the public benefit requirement for charities "it is necessary that there must be more than a de minimis or token benefit for the poor," it rejected any brightline fee reduction or scholarship requirement, instead concluding that "once that low threshold is reached, what the trustees decide to do in the running of the school is a matter for them, subject to acting within the range within which trustees can properly act" (para. 229 of the opinion).  At the same time, it noted that the more than de minimis benefit for the poor is not by itself sufficient to demonstrate public benefit; rather, the test "is to look at what a trustee, acting in the interests of the community as a whole, would do in all the circumstance of the particular school under consideration and to ask what provision should be made once the threshold of benefit going beyond the de minimis or token level had been met" (para. 215 b; see also para. 216).  The Upper Tribunal acknowledged that its decision "will not, we know, give the parties the clarity for which they were hoping" but left it to Parliament to adopt more brightline standards, if it so chose (para. 260).  While the Charity Commission is attempting to paint the decision as a victory, it appears its attempt to focus primarily if not exclusively on requiring fee-charging schools to provide significant access on a reduced or zero fee basis to those of lesser economic means when determining whether such schools provide sufficient public benefit has been dealt a major setback.

Additional statements:  Independent Schools Council (initiated the case); National Council for Voluntary Organizations (intervenor in case).


October 14, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Thursday, October 13, 2011

NYT: "A Quest for Hybrid Companies That Profit, but Can Tap Charity"

The NY Times reports on the current state of "hybrid" legal forms that combine investor ownership with pursing the public good.  Such entities include the recently adopted flexible-purpose corporation in California, the low-profit limited liability company or L3C, and the British community interest company or CIC.  The article also describes various active entities that have chosen these new forms, including MOO Milk of Vermont (a L3C) and Frontline SMS (a CIC that facilitates text messaging by NGOs).


October 13, 2011 in In the News, International, State – Legislative | Permalink | Comments (1) | TrackBack (0)

Tuesday, October 11, 2011

Ninth Circuit: Freezing of Islamic Charity's Assets Unconstitutional

In the continuing legal sage of the now defunct Al Haramain Islamic Foundation (AHIF-Oregon), the U.S. Court of Appeals for the Ninth Circuit issued a decision upholding the federal government's redesignation of the group as a specially designated global terrorist but concluding that the government's warrantless freezing of the nonprofit's assets violated the Fourth Amendment.  It remanded the case to determine what judicial relief, if any, is available. The court also found the government violated the First Amendment rights of another nonprofit, the Multicultural Association of Southern Oregon or MCASO, when it effectively barred MCASO from coordinating its advocacy with AHIF-Oregon.  As previously blogged, a federal district also ordered the government late last year to pay $2.5 million, mostly consisting of legal fees, because of illegal wiretapping of the group's officials. 

One important take-away from the decision is that the court upheld the designation in significant part because an individual who had been designated a global terrorist was a member of the nonprofit's board of directors.  That connection alone was sufficient to essentially end the nonprofit's existence, even if it now has a pyrrrhic victory with respect to the government's freezing of its assets.

Additional coverage: NY Times; Reuters.


October 11, 2011 in Federal – Judicial, In the News, International | Permalink | Comments (0) | TrackBack (0)

Thursday, October 6, 2011

International Red Cross Begins Aid Push in Somalia

The BBC is reporting that the International Red Cross has begun a huge distribution of aid to one million people in famine zones in Somalia.

According to the BBC, a continuous operation will transport the food in trucks from the coast deep into areas controlled by the Islamist militant group, al-Shabab.  The operation began following what the Red Cross terms difficult negotiations with al-Shabab, which banned many Western aid agencies from its territory two years ago.

Red Cross spokesman, Geoff Loane, told the BBC its operation was a three-month distribution, targeting vulnerable people like farmers and pastoralists.

The organisation will also provide seed to nearly a quarter of a million farmers so that they can begin to recover from the region's worse drought in 60 years.  According to Mr. Loane, "If all goes well, hopefully these farmers will be able to harvest some crops by the end of the year."

Meanwhile, the BBC states that its Africa analyst, Martin Plaut, says that if the transportation operation is successful it could "break the back of the famine."

Let's hope so...


October 6, 2011 in Current Affairs, In the News, International | Permalink | Comments (0) | TrackBack (0)

Saturday, September 17, 2011


A contentious law aimed at regulating Cambodia’s non-governmental sector has been sent back to the Ministry of Interior, following international concern that the draft as it stood could damage the country’s development, according to reports by Voice of America’s Khmer service.  The NGO law was approved in August by the Council of Ministers (reported in IJCSL-N for August), despite widespread disapproval from local and international organizations, who said provisions in the draft would make it hard for them to operate and could leave them vulnerable to arbitrary punitive action by government officials. Nouth Sa An, secretary of state for the Ministry of Interior, said the law would not go to the National Assembly as planned but has instead been sent back to the ministry for reconsideration, following international “reaction.”  Ministry officials will now “review and reconsider” the draft before sending it back a second time to the Council of Ministers for approval. Lam Chea, a legal counselor for the Council of Ministers, confirmed the decision.  The move was widely welcomed by members of Cambodian civil society, who had worried the law would stifle organizations critical of the government through excessive red tape or court action. Many also worried it would stymie the growth of small-scale associations at the grassroots.  For more information, see



September 17, 2011 in International | Permalink | Comments (0) | TrackBack (0)

Friday, September 9, 2011

China—Large Number of Recent Scandals in GONGO-type Charities

• In June, netizens raised an outcry after seeing photographs posted online by Ms. Guo Mei Mei, 20, a supposed general manager of the Red Cross’ commercial arm, of her Maserati luxury car and Hermes designer bags. They believe she is the girlfriend of Mr. Wang Jun, who organizes fund-raising drives for the Red Cross.  The National Audit Office has since issued a report listing five financial problems it uncovered at the Red Cross.

• Asia News Network reported that when tennis star Li Na wanted to donate half a million yuan (US$78,000) of her Roland Garros championship prize money in July, she decided not to do it through the Red Cross Society.  After seeing China's largest charity recently embroiled in the Guo Mei Mei controversy over its management and alleged abuse of donations, she chose to donate the money directly to a home for the elderly in her hometown of Wuhan.

• The China-Africa Hope Project, which raises money to build schools in Africa, came under fire in August when a local newspaper found that it was a private enterprise and was deducting 10 per cent of donations for management fees. The charity is headed by 24-year-old Lu Xingyu, the daughter of a prominent businessman, Mr. Lu Junqing.

• The China Charity Federation was accused in August of issuing receipts for solar panels worth 15 million yuan (HK$18.3 million) to a solar panel company, even though the panels were still in the donor’s warehouse, according to mainland media. The federation received a handling fee of 50,000 yuan.  Only large charity funds endorsed by the government can issue such receipts, which allow donors to enjoy tax deductions. Central China Television said the receipts for 15 million yuan would be able to save the donor 2 million yuan in tax.  It said the amount was the result of negotiations with the donor - Suntech Silicon Solar Technology in Wuxi, Zhejiang - and that the federation usually charged a 3 per cent handling fee for cash donations.

• In September, a top representative from Henan Soong Ching Ling Foundation (HSCLF) told Caixin Newspaper that HSCLF siphoned off donor funds for real estate investment following local media reports alleging financial misconduct.  This is also being investigated by the National Audit Office. 

To cap this all off – donations to all charities in China fell by about ninety percent in the wake of the scandals!




September 9, 2011 in International | Permalink | Comments (1) | TrackBack (0)

Third-Largest Charity in China Allegedly Engaged in Extensive Commercial Activities

The Nonprofit Quarterly reports on an article in the South China Morning Post (free registration required) that the China Soong Ching Ling Foundation has engaged in extensive commercial lending and facilitated substantial private real estate development efforts.  Of perhaps greatest interest, the original article is quoted as asserting that this story about the third-largest charity in China follows "a slew of revelations in recent months of irregularities and murky deals involving big names in the sector, including the country's two biggest charities, the Red Cross Society of China and the China Charity Federation."  No word yet on whether the equivalent of Senator Grassley has emerged within the Chinese government to address these issues.


September 9, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Tuesday, August 30, 2011

UK Charity Commission Urged to Allow Not-for-Profit, Charitable Newspapers

We have previously blogged about the trend in the United States toward the creation of nonprofit news organizations (see, for example, a Pew Research Center's Project on Excellence in Journalism post, a federal legislation post, and a Texas Tribune post).  Now from across the Pond comes word that a group of journalists, academics, and charitable funders is asking the Charity Commission for England and Wales to make it easier for nonprofits there to qualify as charities.  The requests were apparently based upon a recent report prepared by the Reuters Institute for the Study of Journalism at Oxford University titled Is There a Better Structure for News Providers?  The Potential in Charitable and Trust Ownership, which is summarized briefly on Oxford's website but is not yet available in full form.  The author is Robert G. Picard.  Here is the summary:

Charitable and trust ownership are frequently advocated as alternatives to challenges in commercial news organisations. This book adds information, evidence and knowledge to the dialogue taking place by exploring existing arrangements in UK, France, Canada, and US, looking at various structural arrangements and exploring advantages and disadvantages of various forms.


August 30, 2011 in Books, In the News, International | Permalink | Comments (0) | TrackBack (0)

Wednesday, August 17, 2011

NYT: "Funds Restored to Aid Groups in Gaza"

I previously blogged about the U.S. State Department's threat to withhold funds for international aid in Gaza because of a Hamas decision to audit the groups receiving those funds.  The N.Y. Times has published an AP report that Hamas dropped its audit demand after the State Department made good on its threat by "pausing" its financial support until Hamas backed down.


August 17, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Friday, August 12, 2011

State Dept. Reacts to Hamas Audit Threat for American-Financed Charities in Gaza

The NY Times reports that the U.S. State Department is threatening to withdraw $100 million of spending in Gaza unless Hamas leaders drop their demand to audit American-financed charities operating there.  According to the article, the trigger for the threat was the decision by Hamas officials to suspend the operation of International Medical Corps after it refused to submit to such an audit.  The dispute is apparently only the latest controversy in what has become an increasingly tense confrontation between the Hamas authorities in Gaza and nongovernmental organizations operating there.  Previously, Hamas demanded that all NGOs register with the government, pay a fee, and submit financial reports, demands that many NGOs initially resisted but eventually agreed to.  The audits appear to have been a step too far for at least some NGOs, however.



August 12, 2011 in In the News, International | Permalink | Comments (1) | TrackBack (0)

Monday, August 8, 2011

Summer Int'l Update: Israel Restricts Nonprofit Speech; Russia Helps Nonprofit Donors

There have been a couple of international legal developments of particular significance to nonprofits this summer.

The NY Times reported that the Israeli Parliament passed legislation prohibiting public calls for a boycott against the state of Israel or its West Bank settlements, including by nonprofit organizations that would risk losing tax benefits if they violated the ban. 

And according to the Charities Aid Foundation, the Russian government approved what is essentially a tax deduction for donors to charities and other tax improvements for such ororganizations that should both enhance charitable fundraising and reduce the operating costs for Russian charities.


August 8, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Anderson, Freedman, Nelson, Reiser & Kelly, and Schwabach on International Aspects of Nonprofit Law

This summer has seen several articles posted on various international aspects of  nonprofit law.  Here are the authors, titles, and abstracts:

Kenneth Anderson (American University), 'Accountability' as 'Legitimacy': Global Governance, Global Civil Society and the United Nations

This essay is a contribution to a symposium on international NGO accountability. It distinguishes between "internal" accountability for NGOs (fiduciary standards, fiscal and internal governance controls, etc.) and "external" accountability (the legitimacy with which they act in the international world, and the legitimacy which they confer upon others, and why). The essay focuses upon the latter, external accountability, and argues that the transformation of international NGOs into "global civil society" signaled an ideological move with regards to legitimacy in the global community, one which asserted claims of "representativeness" and not merely interest or expertise. The essay criticizes this legitimacy move, suggesting that it arises from mutual interests on the part of international NGOs and public international organizations such as the UN to confer legitimacy upon each other in the interest of promoting a mutually congenial form of global governance. The essay offers this account and critique in the context of a quasi-historical examination of the rise of the human rights movement as the "apex" values of the international system, with a special "legitimacy" place in that system accorded to international human rights NGOs. The essay concludes by noting that this "auto-legitimation" between international NGOs and international organizations does not lead to greater external accountability, particularly in an increasingly multipolar world.

Michael G. Freedman, Prosecuting Terrorism: The Material Support Statute and Muslim Charities

The federal law prohibiting the provision of material support to terrorist organizations has been no stranger to controversy. From its politically charged origins through its repeated amendment after September 11, 2001, it has remained an important, but often critiqued, weapon in the government’s legal response to terrorism. The most prominent legal challenge to the law lasted over a decade. It culminated in June 2010, when the United States Supreme Court upheld the constitutionality of the law in Holder v. Humanitarian Law Project. The Court’s opinion, however, correctly recognized that important questions remain unresolved.

One such question, which this note addresses, is the application of the law to Muslim charities. Muslim charities are a complex, often misunderstood phenomenon. The use of the law against groups such as the Holy Land Foundation has achieved limited success, but has also alienated significant numbers of Muslim Americans. Civil actions against the group based on the material support law have been particularly ineffective. Likewise, criminal prosecutions have met considerable difficulty. This note explores applications of the material support statute to Muslim charities and concludes by proposing several recommendations for reform in this important area.

William Alan Nelson II (GWU), No Good Deed Goes Unpunished: Charitable Contributions and the Foreign Corrupt Practices Act

The area of charitable contributions under the Foreign Corrupt Practices Act (“FCPA”) is an ambiguous area of law where liability for companies can be enormous. This article examines the challenges companies face under the FCPA when making charitable contributions. It provides an in-depth analysis of the Schering-Plough case, which illustrates how the Securities and Exchange Commission (“SEC”) applies the record-keeping provisions of the FCPA in a situation of charitable giving; it examines Department of Justice (“DOJ”) FCPA Review Opinion Procedure Releases that provide guidance on when companies’ charitable contributions will violate the anti-bribery provisions of the FCPA; it discusses the effect of “compelled giving” laws, which require that foreign companies must agree to invest an established percentage of the profits from each contract into the community in which it operates; and it provides hypothetical situations illustrating the broad array of problems arising under the FCPA for companies making charitable contributions.

The article also looks at corporate social responsibility (“CSR”) in the context of FCPA enforcement. It provides hypothetical situations illustrating companies’ use of CSR to disguise acts of bribery and examines any “chilling effect” that the FCPA has on companies’ charitable giving. This discussion is especially timely in light of the natural disasters in Haiti in 2010 and Japan in 2011. Most companies do not view charitable contributions as an area of risk in their respective FCPA and anti-corruption compliance programs. The article proposes a model FCPA compliance program for charitable contributions, including the creation of a Charitable Contributions Compliance Committee, and presents a roadmap for the due diligence required to minimize liability under the FCPA when making charitable contributions.

Dana Brakman Resier (Brooklyn) and Claire Kelly (Brooklyn), Linking NGO Accountability and the Legitimacy of Global Governance

Concerns are often raised over whether international government organizations suffer from a democracy deficit, and sometimes the participation of NGOs in these entities is offered as a cure for this ill. However, to serve such an ameliorative role, perhaps NGOs need to themselves be composed and governed transparently, deliberatively, participatorily. What should be done when these goals conflict? Current domestic nonprofit law, which forms the basis for how NGOs are structured internally, attempts to create an effective and enforceable regime of nonprofit accountability. This paper asks whether these governance and accountability frameworks offered by domestic law, particularly but not exclusively in the U.S., provide sufficient content to appropriately regulate and incentivize NGOs working internationally.

Aaron Schwabach (Thomas Jefferson), Of Charities and Clawbacks: The European Union Proposal on Successions and Wills as a Threat to Charitable Giving

In the United Kingdom, and to a lesser extent the United States, an inter vivos gift, once given, cannot be reclaimed by the giver's heirs. In civil law countries the situation is quite different: Not only spouses, but issue and in some cases even ascendants, are entitled to a forced share of a decedent's estate, and these forced shares are assessed against a notional "estate" that includes the testator's inter vivos gifts. If the total of these forced shares exceeds the amount actually available in the decedent's estate at death, the recipients of the gifts, or their successors, may be forced to make up the missing amount.

Clawbacks of this nature might have remained relatively insignificant, but last year the European Union undertook, indirectly, to expand their reach dramatically. The EU proposal, in theory, addresses only conflict of law rules; in practice, if adopted, it will threaten not only existing trusts and charitable gifts in the US and UK, but may also reduce future philanthropic giving. The UK, to date, has opted out of the proposal, and the US is not directly affected; given the large number of US and UK citizens with assets in continental Europe, however, and vice versa, it remains a concern.

The recent European Union proposal to bring about a more uniform body of law governing choice of law and related issues in international inheritance cases is, perhaps, a necessary response to the increasingly international nature of the EU's (and the world's) inhabitants and their assets. As written, though, it is rather heavily tilted toward the civil law values of continental Europe and threatens to collide jarringly with common law traditions, in particular the Anglo-American fondness for trusts and charitable giving. This article provides a look at these different traditions, and then examines the relevant inheritance law provisions of EU member states, the UK, and the US before looking at the proposal itself.


August 8, 2011 in International, Publications – Articles | Permalink | Comments (0) | TrackBack (0)

Monday, June 27, 2011

Lady Gaga Japan Relief Efforts Lead to Federal RICO Lawsuit

Lady Gaga (Stefani Germanotta) and various companies have been hit with a federal RICO lawsuit alleging that contrary to public representations they retained a portion of the donations collected through the "Lady Gaga Japan Earthquake Relief Wristband" effort.  The class action suit, filed in the U.S. District Court for the Eastern District of Michigan seeks a range of damages, including punitive and treble damages. No response from Lady Gaga yet, but presumably one will be forthcoming shortly.

Coverage:  International Business Times.


June 27, 2011 in Federal – Judicial, In the News, International | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 7, 2011

UK: Number of Charities Down Despite Gov't Push for More Charity Provision of Public Services

The Guardian reports that despite the Conservative Party government's "big society" initiative to involve more charities in providing public services, the number of registered charities actually declined by 1,600 over the past year.  The reasons for the decline are unclear, although the Charity Commission noted that its merger unit has seen a 150 percent increase in cases since 2009.  The shrinkage represents approximately one percent of registered charities, of which there are currently 162,346.  Charity leaders also expressed concerns that the decline may only foreshadow a more substantial contraction of the charitable sector as government budget cuts begin to hit charity revenues and a long-term shrinkage in the number of UK households that donate to charities continues. 


June 7, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Tuesday, May 31, 2011

Greenpeace Charity Status in New Zealand at Risk for Political Activities

TVNZ reports that the New Zealand affiliate of Greenpeace has lost significant tax breaks that are now only available to recognized charities.  While the affiliate maintains it qualifies as a charity, the New Zealand Charity Commission has rejected that claim based on the level of the affiliate's political involvement.  It was only six years ago that the Charity Commission was established and purported charities had to formally register with the Commission.  While most applicants have successfully registered, the Commission has rejected registration for a number of organizations, including Greenpeace of New Zealand.  The tax benefits at issue include exemption from income tax and tax rebate elibility for donors.  The affiliate is making an argument that will be familiar to U.S. readers, that the law fails to provide a clear line regarding how much political advocacy is too much and that such advocacy can be an essential part of fulfilling a charitable mission.

More specifically, in rejecting the registration application, the Charity Commission concluded: "the Commission considers that if the promotion of disarmament and peace [one of the affiliate's stated purposes] is done in a way that is considered political, for example, by requiring a change of law or government policy in New Zealand or abroad, it will not be charitable."  The Commission also concluded that a general purpose statement that the affiliate would "[p]romote the adoption of legislation, policies, rules, regulations and plans which further the objects of the Society and support the enforcement or implementation through political or judicial processes as necessary" also demonstrated an independent, non-charitable purpose.  The Commission further concluded that these two purposes demonstrated a non-ancillary, political purpose and so disqualified the affiliate from charity status under New Zealand law, which is based in large part on English law.


May 31, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 25, 2011

Singapore Issues a Revised "Code of Governance for Charities and Institutions of a Public Character"

The Singapore Charity Council has issued a revised  Code of Governance for Charities and Institutions of Public Concern available for downloand here:(Download Code_of_Governance_for_Charities_&_IPCs_(2011)[2])  The revised Code replaces the previous code that became effective in November 2007 andn is effective April 1, 2011.  From the introduction:


 Charities are community organisations that work for public benefit. They are encouraged to applythe principles and practices of governance and management listed in this Code of Governance. Governance is important because it affects how a charity is run and the services that the organisation provides. The Board of a charity is responsible for putting in place the principles and practices of good governance in the organisation. The Code also helps charities to be more effective, transparent and accountable to their stakeholders.  Members of the public donate and volunteer services to charities. This Code aims to help the public understand what good governance is and to make an informed decision on which charity to support.

And here is the preamble:


1. Charities differ greatly in size, activity and circumstances. Not all Code guidelines will apply to every charity. But all charities should go through the entire Code and take the necessary action to improve their governance.

2. The Code was first introduced by the Charity Council in November 2007. To help charities apply the Code more effectively, the Charity Council held an exercise to refi ne the Code in 2010.  A Sub-Committee was formed, as well as three workgroups of representatives from charities/Institutions of a Public Character (IPCs), professional bodies, academia, auditors and grantmakers.  They proposed changes based on feedback and their experiences on the ground.

 3. This refined Code provides greater clarity and relevance about good governance to the charity sector. Charities are encouraged to refer to the related guides and templates on the Charity Council Website ( to better understand the Code and how it could be applied.






January 25, 2011 in International | Permalink | Comments (1) | TrackBack (0)

Friday, January 7, 2011

NYT: "Microlenders, Honored with Nobel, Are Struggling"

The New York Times reports that in many developing countries microfinance is experiencing a political backlash.  In the wake of reports that for-profit microcredit businesses are using strong-arm tactics to obtain loan repayments and possible over or poor lending that fail to create businesses capable of repaying the loans, governments from Asia to Latin America are imposing new restrictions on such businesses and urging borrowers not to repay their loans.  In part these developments may reflect the tension between nonprofit microcredit organizations that, without a profit motive, may be more careful in targeting loans and working with borrowers but lack access to sufficient capital to meet the borrowing demand, and for-profit microcredit businesses that have access to that capital but then face the profit-making pressures that can lead to unwise lending practices and excessive growth.  Article, anyone?


January 7, 2011 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 22, 2010

Charities Abandon Effort to Modify Treasury Department Global Grantmaking Guidelines

The Council on Foundations recently issue a press release announcing that a working group of more than 70 charities has ended its seven-year effort to convince the Treasury Department to modify its approach to global grantmaking.  Sparked by Treasury's issuance of "voluntary" anti-terrorist guidelines for charities in the wake of 9/11, the working group strove to convince Treasury to modify the guidelines to better reflect the reality of international charitable activities.  Those efforts led to a revision of the guidelines in 2006, but according to the press release those revisions were not sufficient to resolve concerns that the guidelines are "confusing and misleading."  Lack of responsiveness from Treasury led the group to determine "it can no longer support or participate in Treasury's attempts to impose current or future versions of the guidelines on the charitable sector."


December 22, 2010 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Tuesday, November 9, 2010

UK: Budget Cuts May Hinder Combatting Charity Fraud

The BBC reports that a 27 percent cut in the budget for the Charity Commission that registers and regulates charities in England and Wales has led the Commission's chief executive to state publicly that he is considering ignoring some reports of charity fraud. More specifically, the Commission might ignore reports where the amount of charitable funds at risk is relatively small, leaving such investigations to the regular police (who face budget cuts of their own).  Last year the Commission investigated 450 reports of fraud and mismanagement (as compared to 180,000 registered charities), and the articles states the Commission regards that number as significantly underestimating the fraud and mismanagement problems within the charitable sector. 


November 9, 2010 in In the News, International | Permalink | Comments (0) | TrackBack (0)

Tuesday, October 26, 2010

Microlending in the USA

For years, social entrepreneurs in the U.S.  have applauded microlending programs as tools for wealth generation in poor countries.  The programs, generlly based on the model established by Muhammad Yunus and the Grameen Bank, provide small loans to entrepreneurs who ordinarily do not qualify for bank financing.  Until recently, microloan programs were confined primarily to the poorest nations.

Recently, the Community Development Law Clinic that I supervise in North Carolina has received requests from local groups wishing to form microloan programs in their communities.  And it appears that microloan programs' migration to the US is not confined to my home state.  The Wall Street Journalreported recently that Kiva, a nonprofit known for helping foreign entrepreneurs receive microloans, is beginning to do business along the U.S. Gulf Coast.  Kiva is the best known of the so-called "crowdfunding" organizations that act as a portal, matching donors who want to loan to microentrepreneurs with low income people who need capital to start businesses.


October 26, 2010 in Current Affairs, In the News, International | Permalink | Comments (1) | TrackBack (0)