Recently, the New York Times published an article that confirmed what Paradigm Shift already understood: giving the poor access to credit without giving them the business tools to succeed is a missed opportunity.

Paradigm Shift continues to see microentrepreneurs complete a 12 hour basic business course before being eligible for a microloan. Then during weekly meetings, more in depth business principles are explored along with the repayment of their microloan and studying what the Bible has to say about their lives, their families and their businesses.

Check out the article below or visit is here

June 25, 2009
Small Business
Lending Talent, and Money, on a Micro Scale
By KATE MURPHY

Government agencies and international aid groups have long supported programs that train the world’s poor in how to start and run their own businesses. The training is seen as a way to end hunger and stabilize societies.

But interest in these programs has grown lately with the wider availability of microloans, or very small enterprise loans made to the poor. As with any start-up, these businesses are more likely to survive, advocates say, if the owners have basic operational skills.

“There’s been a realization in the microfinance community that loan recipients are more likely to succeed if they also receive business education,” said Bobbi L. Gray, research and evaluation specialist with Freedom From Hunger, a nonprofit organization in Davis, Calif., that provides financial education in developing countries.

Indeed, the nonprofit research group Innovations for Poverty Action in New Haven, Conn., published a paper in May that found that Peruvian villagers who had received microloans and had been randomly selected to receive business training performed significantly better than peers who had received loans and no financial education.

“Even those who reported having the least interest before getting the training had higher revenues,” said Dean Karlan, a professor of economics at Yale, a founder of Innovations and lead author of the study.
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Recent news article published by the BBC about banking services reaching the poor through cell phone technology.

The Consultative Group to Assist the Poor (CGAP) said it thought the number of people with access to a mobile phone, but no bank account, would to rise to 1.7 billion in 2012.

It also expected more than one in five to use their mobile to access banking services, creating a market worth up to $5bn.

Yesterday, we opened Paradigm Shift up into a new community- Cosmo City. Back in April, we wrote about the possibility of going up there and yesterday it became a reality.

I stood in the orientation meeting looking out over 25 entrepreneurs that for the first time were hearing what Paradigm Shift is all about and their level of excitement and engagement was contagious!

This Saturday the Paradigm Shift team will be working with our partners in Cosmo City to facilitate the Business Experience Course which helps us determine the level of commitment from entrepreneurs and also facilitates the selection process for those receiving a micro loan of $170.

If you want to know more about Cosmo City read a brief overview that I found in “The Joburg Book”
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