There’s a lot of news articles out about the effects of micro-lending and how it is having a transformative impact. You can go here for a long list of organizations and articles etc: http://en.wikipedia.org/wiki/Microlending
Does anyone think this practice would be of benefit in the US? Is it already being used? What areas and for what means do you think this would be beneficial?
The US has a long history of people/businesses taking advantage of the poor; the former, of course, being more financially sophisticated than the latter. Share cropping is the perfect example. For more recent proof, look at Rent-to-Own furniture stores and Payday loans. In developing countries individuals have the opportunity to start businesses with a relatively small amount of capital. These people, unlike US citizens, have ideas and determination, but no access to capital. With relatively easy access to capital, US citizens with good ideas and determination have already found the means to live the “American dream.” With a well written business plan, the US Government will take on a major part of your business risk via SBA loans. Furthermore, extensive business rules and regulations make it all but impossible for a financially unsophisticated individual to gain enough seed money to start a venture of any kind. IMO, micro lending will attract nothing but thugs and bottom feeders who are constantly looking for new ways to scam the poor.
I’m not sure I agree with your assessment. Access to capital or cheap loans is not a birth right. From my standpoint, the SBA is already out there handing out money in bucketfulls. If you are too undercapitalized or unqualified to get an SBA loan, then there is a good chance you should be an employee not a business owner. If you want to lean how to capitalize and start a business, move to CA and observe the 1st generation Indian and Asian businessmen. They’ve got it going on.
Did you read the lengthy article in last week’s New Yorker about this? It was quite fascinating.
Didn’t see it, do you have a link?
Try this:
http://www.newyorker.com/fact/content/articles/061030fa_fact1
They call it microfinance but I think it is the same thing you are talking about.
Too many people in the US are like the family that conned a Memphis church into raising $75k to buy them a house, which they flipped and walked away with the money and zero remorse.
I think its a great idea. I was watching something on PBS about a non-profit that connects normal every day Americans with African entrepreneurs…I might even try it out.
www.Kiva.org is the site/company
…now Americans lending to Americans, that could be dangerous. lol
American microlending exists. There was an article in this month’s Money magazine regarding the company pioneering this.
Gosh, I get queries from African entrepreneurs on a daily basis…I’ll have to forward you some… 
I’ll probably start a huge war by saying this but, I’m prepared – there is NO poverty in the US. As a US citizen, you would have to go out of your way to be impoverished. Yes, poor is a relative term. But anyone in the US who chooses, has free access to food, shelter, and health care – your basic needs if you will. This is not true in most third world countries.
So, give a microloan to a man/woman who has his/her basic needs taken care of and what are they going to do with the $$$? Also, these people are protected by some extremely lax credit laws (regulations are definitely on the side of the debtor). My point is that microlending – targeted at lower income individuals – is not going to solve any of their problems. With rates that approach usery, microlending is going to create more problems in the US than it solves.