Online Global Philantropy

Contributors: Howard Rheingold, Jessica Margolin, Frank Baitman, Jody Ranck, John Maloney, Yuji Shibuya

Summary:
Parallel to changes in the business sector, the practice of philanthropy will shift to take advantage of peer-to-peer networks and lightweight economic infrastructures. However, the new strategies may not help the poorest poor if they fail to address the underlying structural barriers to alleviating poverty.

The combination of peer-to-peer networks and microcredit strategies that have emerged over the last decade have the potential to change the face of philanthropy: they enable many individuals, rather than a few large organizations, to become the channels for giving and receiving. As the gap between rich and poor grows, these methods have the potential to rebuild, in particular, the middle zones of the economic distribution graph.

However, many of these efforts have somewhat limited success in reaching the poorest. Many of them “cream”—that is, they focus on the more affluent and entrepreneurial poor. The poorest poor need more than credit to break out of the cycles of poverty. Structural barriers to health, education, and social empowerment need to be addressed as well. Peer-to-peer and microcredit strategies are more likely to succeed in alleviating poverty in developed countries, where these barriers are sometimes lower.

A key question about this strategy is whether it can build the kind of staying power required in a process that has a very slow repayment rate. As mainstream philanthropy has focused more on near-term returns, does grassroots philanthropy play any better on the “long-term solutions” field?

One of the most successful “credit” programs is the Self-Employed Women’s Association based in Ahmedabad, India, which addressed a range of structural barriers that poor women face.

Other examples of groups using these strategies and/or promoting them:

*SocialFunds articles on microfinance as new asset class:*

Circle one
http://www.techcrunch.com/2005/10/27/circleone-rumored-to-launch-soon/

Full Circle Fund
www.fullcirclefund.org

http://del.icio.us/tag/microfinance

http://kbyutv.org/smallfortunes/

http://www.nextbillion.net/blogs/2005/12/23/the-year-of-microcredit-a-retrospective

http://www.worldchanging.com/archives/003423.html

http://www.globalgiving.com/

http://kiva.org/

Insights

This is the area where the power of ‘peer-to-peer network’ is effectively demonstrated.

-Fast, first hand information

-Feel reality right away instead of through reporters’ perception

We can following local Blogs

-Less personal time but greater satisfaction

-Contributions go directly to recipients

-PayPal and others will play larger roles in distributing charitable contribution.

 Create your own educational wiki!HelpPublic, not yet premium Privacy Policy RSS