Best Ideas 2020 features all the nominated entries submitted under ‘Submit your Idea’ category. All the entries consist of innovative solutions or propositions for an enterprise that champions the Sustainable Development Goals. They can be on the conceptual, planning, or start-up stage.
Explain your idea in details:
Empower Microfinance (EM) is a mobile application that connects women from under-deserved communities to lenders for microloans without requiring collateral. It focuses on empowering underserved female entrepreneurs who are denied access to traditional banking services. By doing so, these female entrepreneurs are able to take advantage of income-generating activities to help sustain the livelihoods of their families and communities. This not only contributes to society through the alleviation of poverty but also puts a strong emphasis on closing gender inequality through its focus on offering financial opportunities to female entrepreneurs. Most significantly, it is a stratified model that reaches out to the poorest of the poor through actively helping them out to find a viable solution to combat poverty rather than handing them loans they cannot repay.
Expected impact of your idea on sustainable development
The feminization of poverty is the central problem microfinance can solve. Research has shown women are at a significant disadvantage when it comes to economic empowerment (Gender Gap Report 2020). Among 10 percent of those who live under the absolute poverty line, approximately 70 percent identify as women. These women are not only subjected to more barriers to access financial opportunities but also stringently defined gender norms that relegate them to the caretakers of households. Empower Microfinance Institution empowers women from under-deserved communities to take advantage of income-generating activities to help sustain the livelihoods of their families and communities. This not only contributes to society through the alleviation of poverty but also puts a strong emphasis on closing gender inequality through its focus on offering financial opportunities to female entrepreneurs. This aligns with Sustainable Development Goals 1 for No Poverty and 5 for Gender Equality. Considering that poverty is a worldwide issue with 734 million people suffering from absolute poverty, our target clients are women living under the poverty line who want to change their lives through launching businesses and virtually any smartphone users who wish to further their cause of combating poverty. According to Opportunity International, $5,000 provides a Trust Group with the resources to empower approximately 25 clients and their families, leading to a meaningful impact on around 110 people. This means that serving 10,000 clients with microloans of 2 million dollars will have a multiplier effect helping approximately 45,000 additional people worldwide.
Plans for implementation and sustainability
Empower Microfinance is created through Java, Android Studio, and SQLite and is currently available on Google Play. It currently uses In-App Purchase for lending and repayment transactions. However, for better compatibility with IOS users in the future, EM plans to incorporate PayPal for financial transactions. To elaborate more on sustainability, there are three distinct qualities of EM different from other microfinance institutions. The first advantage is the timeline milestone in the application requires the borrowers to layout an actual business plan for their repayment. EM provides a template for borrowers to write their business plans in three milestones, which not only deters scammers from easily obtaining loans but also incentivizes the users to reflect on the plausibility of their business plans and generating repayments. More conspicuously, help service ensures that the borrowers can receive appropriate guidance towards launching their businesses successfully. EM Microfinance connects the borrowers with field partners to plan out their business training sessions and repayment plans. Through a more direct engagement between the company and loan borrowers, we prevent repayment delinquency and possible problems that can arise from the direct conversations between lenders and borrowers. But what happens if a borrower who lacks the ability to repay loans applies to EM? This is a part that EM truly stands out from other microfinance institutions. Handing out loans for those who barely can have food on their table only induces over-indebtedness. Therefore, EM, with the partnership with local charity workers, provides information and connects them with non-profit organizations to consult their needs. Once their needs are fulfilled, they can reapply to set up their businesses.
Minji Kang is a 20-years-old social entrepreneur who previously launched an online crowdfunding project to fund secondary-education for Ethiopian refugee girls. She is currently studying Political Science at the University of Southern California with a full-merit Trustee Scholarship. Minji is interested in social welfare issues-particularly in gender-related and poverty issues. She is now combining her coding background with her interest, so she initiated to Empower Microfinance while studying about inequality issues. Her passion for gender and equality issues stems from her experience as the founder and president of the United Nations Girl Up Chapter in high school, where she initiated social activities starting from producing short films raising awareness of child-marriage issues to launch online crowdfunding projects for education programs. At the moment, Minji's passion keeps growing, and she vocally fights for these issues. She is currently authoring a research paper on the intersection between microfinance and gender equality to help identify different variables that effectively serve microfinance communities.