Beauty shops, dry goods sellers, tailors, and fruit sellers line the street up and down each side and in the middle. People walk about the street leaving little room for cars. This is a street in Bamako, the capital of Mali, West Africa. Some would say that small businesses drive the middle class, but Mali is not a country with a large middle class. Bamako, like many developing cities, is full of entrepreneurs. Entrepreneurs create small businesses. Yet small businesses and entrepreneurs can be driven by either necessity or opportunity, and this makes all the difference.
Often Africa is portrayed as a continent of misery and sadness, often failing to differentiate between the ‘bush’ and the hustle and bustle of its fast-growing cities. Bangladesh is likewise crowded and poor. In both places microfinance has allowed many of the poor, especially women, to own their own livestock, start small businesses, and send their children to school. Yet microfinance also has its share of critics. Mohammed Yunus, the Nobel Prize-winner credited with inventing the concept with his Grameen Bank, has run into issues of corruption and microfinance institutions in general have been criticized for charging exorbitant interest rates.
Microfinance, microloans, microcredit, and everything ‘micro’ has gone macro in recent years. In Bamako as well, microfinance institutions are popping up on every street corner. Though these institutions seem like a new fad, they represent far older associations in Malian society.
In the past, these associations centered around family or clan affiliation, as well as ceremonial or professional line. This is not only true for Mali. While the microlenders—that is Westerners and Western institutions—may be introducing new money, community groups such as those made up of microloanees have existed long before microloan associations ever cropped up. So what role do those who intervene play?
It is first helpful to realize that an economy’s outsiders can be investors, enabling those on the ground to innovate and grow their business with resources they may not be able to muster on their own. Just as Wall Street investors enable newly-public companies to leverage new capital into new growth, so can we enable business owners in poorer parts of the world to push into new markets and create new products. But as with Wall Street investors, we should do our homework. Investors can just as easily saddle the investment recipient with debt or, in highly informal economies, encourage corruption with immense bureaucratic red tape.
Secondly, then, we must see how and where we can best intervene. We can research a microfinance organization’s practices, but researching its local subsidiaries may be even more important. Finding businesses on the ground can be challenging, but those who are able can practice diligence by traveling abroad. We can use personal connections or seek out the local chapter of the American Chamber of Commerce. Thinking outside the box, we can host an exchange student, volunteer to serve overseas, learn a foreign language, or invest in educational establishments overseas. All of these can lead to wiser and more effective financial decisions.
Clearly, if Westerners attempt to tackle the system, the system will swallow them up. We must humbly recognize that poverty did not arrive overnight and we cannot chase it out ourselves. We can, however, remember that we share a common humanity with those living in poorer communities and countries than our own. No matter where we live, we share a common mandate to “Be fruitful and multiply and fill the earth and subdue it” (Gen 1:28). By enabling others to foster their talents to care for their families and glorify God, we can help turn necessity into opportunity. We are not all are called to be entrepreneurs, but all are called to create.