When 10 undergraduate students from the School of Business traveled to Léon, Nicaragua, for nine days during their winter break, they had a clear mission: determine whether three local entrepreneurs should receive microloans to expand their businesses.
Microcredit involves giving loans of less than $500 to help people living in poverty succeed as entrepreneurs. Often small business owners in developing countries cannot qualify for traditional bank loans or cannot afford to pay steep interest charges.
The trip, made in conjunction with the Albert Schweitzer Institute, marked the start of Quinnipiac's first microcredit program. Six MBA students also made the trip and helped a different group of entrepreneurs develop business plans.
Monica Torpey, a sophomore majoring in international business, enjoyed living with a host family and described the trip as a "cultural whirlwind." Senior Lindsay Kruck said it was "inspiring" to see what a difference microlending can make to impoverished individuals.
Quinnipiac and the Albert Schweitzer Institute have teamed up with Alianza Americana, a Nicaragua-based social service organization, to provide the loans. The University has set aside an initial $1,500 for the program, and Alianza Americana will keep the interest payments in return for administering the loans. The principal will be returned to the fund.
"The goal is to help businesses expand so that they can stand on their own feet," said Mohammad N. Elahee, professor of international business. "It also helps the local community by generating more jobs."
Elahee first visited Léon in 2003, along with Schweitzer Institute executive director David Ives, to organize an alternative spring break program. The microcredit program was their idea, and it was brought to fruition with help from Matthew O'Connor, dean of the School of Business, and former dean Mark Thompson, now senior vice president for academic and student affairs.
"This gives our students a chance to use the business and management skills they are developing in the business program in a service environment, and it will have a tremendous impact on these small businesses in Léon," O'Connor said.
Jason Candee '10, an international business major, was one of three students assigned to interview Gloria Asantana, a 45-year-old attorney and entrepreneur in Léon, on theWestern coast of Nicaragua 43 miles north of the capital city of Managua. She developed a product delivery service on the side and wants to open a store to sell beach wear, school supplies and gifts. She travels to Managua twice a month to buy goods; and having a store would give her room for inventory. After meeting with Asantana, the students agreed to loan her $500, to be repaid in monthly installments at 10 percent interest.
Other student groups approved similar loans to two other entrepreneurs: a woman with a variety store who buys goods from neighboring Honduras, and a man who wants to open an office supply store. Elahee had prescreened the entrepreneurs on an earlier trip. "I was amazed at the dedication and motivation the students showed," Elahee said. "For most it was their first encounter with poverty. It made a big impact on them. I think it was a very transformative experience."
Ives hopes to expand the microcredit program to other countries. He said he became aware of Léon when he worked in the Peace Corps in Costa Rica. "In the Peace Corps I worked with a lot of groups, and the ones that were able to create their own wealth did a lot better than the ones who were given handouts," he said.
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