The Atlanta Journal-Constitution recently had an interesting article at Habitat for Humanity's plans to start a microlending program to fund building projects. From the Journal:
Habitat for Humanity is looking to grow funds by borrowing a developing-world concept: microloans. The Atlanta-based nonprofit, which builds homes for people in need, is expected to announce Thursday the launch of a microloan program in partnership with the Maryland-based Calvert Foundation. It will allow individuals to invest in — rather than simply donate to — Habitat's philanthropic mission.
Investors can buy a stake in Habitat's microloan program for as little as $100. If the program is a success, investors eventually would receive interest payments on their money.
Microloans are typically used to provide small amounts of credit to people or businesses that do not qualify for traditional loans. The concept has become increasingly popular in the developing world, but it is a first for Habitat, which has subsisted almost entirely on donations, grants and proceeds from home sales. Read the rest here.
What do you think about this plan? Will nonprofits that have the capacity to pay back funds begin fundraising more and more in this way?
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