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Microlending Enters a New Phase

Long associated with less-developed economies, various efforts to hook smaller bits of First World money to First World needs are afoot.

The Sunday Styles section of The New York Times is a cross between a lifestyle section and a high-end tabloid. And as I was reading through it this weekend, I came across two different, yet related items.

As readers of the Styles section know, the back pages are filled with wedding announcements, and there was one that particularly caught my eye. Monica Yunus and Brandon McReynolds were getting married. At first glace, they were just another couple, among the dozens of other upwardly mobile, or already upward, that grace the marriage pages. But Yunus, a soprano on the roster of the Metropolitan Opera, has a particularly famous father, at least in certain wonky and economics circles: Muhammad Yunus, an economist and head of the Grameen Bank in Dhaka, Bangladesh who won the Nobel Peace Prize in 2006 for his work on microlending.

The daughter has not followed directly in her father's footsteps, but others certainly have.

In the past couple of years, microlending has become a cultural buzzword. High-profile celebrities like Natalie Portman have been publicizing its benefits. Web sites like Kiva have made it easy for person-to-person microlending. According to the site, Kiva "empower(s) individuals to lend directly to unique entrepreneurs around the globe."

While Kiva has traditionally hooked up lenders from the West to people in the developing world, they recently entered a new phase in their lending practices: domestic lending. This makes perfect sense in a time when the U.S. is going through a massive recession and the banking industry is in a state of collapse at worst, and in flux at best.

A successful idea like microlending is bound to move beyond its origins.

And this brings me to the second item from the Styles section. Three recent Harvard University graduates have started a Web site, UniThrive, that connects donors to students who need loans. At this early phase, the site is meant to connect donors with Harvard scholarship students who are asked to contribute $2,000 from a job.

But students requesting the money are not limited to making purely academic requests. The Times sites this example:

"Ricky Kuperman, a student borrower who just finished his sophomore year at Harvard and is an accomplished dancer, said in an interview that he wanted the $2,000 no-interest loan to visit Okinawa, Japan, in 2010 to spend time in the birthplace of karate. 'If I don't get the money, I will have to work longer next summer or during the term,' he said. 'It will allow me to stay in shape and make getting cast in films or in dance projects that much more possible.'"

I am hopeful that this flurry of activity around microlending is a response to the corporate greed that has defined our economy for much of the past decade. While there are students at lesser-known universities who may need money for something else besides going to the birthplace of karate, microlending's new phase is something to rejoice.

Here's hoping we hear this question with greater frequency: "Hey man. Can you microlend me some cash until I graduate?"

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