international development

Microfinance: An Overview

By: Sam Crawford-Cloonan
Sam is a participant in the Emerging Leaders in Philanthropy: Explorers class. 

Microfinance is when many donors, each giving a small amount, loan a relatively large sum of money (say, a thousand dollars) to an individual in need (usually in a developing country) in order to make a significant development in that individual's life. The development helps the individual pay off the debt incurred from the loan, and the money is given back to the donors.

I, personally, would invest in microfinance because it's an efficient and effective way of improving the quality of life (QL) of someone in need. The micro-entepreneurs are then able to break the cycle of poverty. Most of those asking for loans have just enough resources to support themselves  sufficiently, but not enough to improve Quality of life. This leads to a lack of ability to support oneself.

Individuals receiving microfinancial loans become able to support themselves and improve their QL. Loans are also more beneficial than a hand out because there is the added responsibility of being able to pay money back, thus the money is required to be used as a means of financial development rather than directly being used for day-to-day support.

For investors, microfinance is a way to give help to someone in need while still being able to make their money back. In that way, it's a very safe investment. A person can donate time and time again as their funds are replenished by micro-entrepreneurs who pay back their loans. Thus, if managed properly, the exchange is fully sustainable.

In conclusion, microfinance is a necessary part of today's world when it comes to linking local philanthropists to global issues on an individual scale, making the 'treasure' section of the pillars of philanthropy (giving time and talent and treasure) easily transferable and available. The next step? Bringing time and talent to that level of availability--and I'd love to see what this generation does to do so.

On an entirely separate note, my favorite experiences in ELP are the ones in which the students are able to have a natural discussion over previously discussed topics. Being able to ask questions and learn more about philanthropy, both local and global, is both necessary and freeing. 

Taking Action to Change US Food Aid: February goodTALK

By: Katherine and Emily
Katherine and Emily are both Program Fellows at Allowance for Good and students at Northwestern University. Read their bios here.

On February 12th, we braved the cold to attend a goodTALK with Josh Meyer, a Lecturer at National Security Studies at Medill’s Washington program, where he teaches graduate level journalism classes on covering conflicts, terrorism and national security. At this event, Meyer discussed the investigation into the US food aid effort that he led with a group of graduate students in the Medill School of Journalism. In a report titled, Hunger Pains: A Problem-plagued US Food Aid Program Faces an Uncertain Future, his team explored the inefficiencies and pitfalls of the program.We joined Northwestern students, staff and other interested members of the public around a table to hear Meyer speak in an intimate setting. Meyer kept everyone engaged throughout the 90 minute presentation with a powerpoint full of potent and dismaying statistics about the US Food Aid program, a long Q&A portion, and even a clip from the Daily Show. After hearing his talk, we at AfG have been moved to act in order to improve this ineffective system.

Josh Meyer chooses to focus his research not on sensationalized current events, but global systemic issues that have repercussions now and for future generations. One large-scale issue that Meyer believes will only become worse with the future challenges presented by climate change is food insecurity. By narrowing in on US food aid, Meyer’s team investigated a subject that the US public can directly impact and hold their government accountable for. As the leading global power, the US has the resources to help people throughout the world who are in need, and in the past century it has been central to US foreign policy, and the American identity, to do so. This ideology has persisted into the 21st century; military action, aid and various disaster relief efforts have all been presented as sacrifices made by the US to protect human rights abroad. But what happens when these aid efforts are wasteful and unproductive?

U.S. food aid has been quoted by experts to be the most inefficient humanitarian aid program in the world. Interviews with U.S. officials and recipients of aid on three continents revealed that USAID, the agency in charge of the food aid effort, actively seeks to serve American economic interests over the interests of those in need. Congressional mandates force USAID to use American commodities sent on American ships through an extensive logistic transportation bureaucracy. As a result, food often arrives months too late, and spoiled from the overseas journey. Former USAID administrator Andrew Natsios claims that, “people have died waiting for food to arrive,” because of this long and slow process. 

Regardless of these problems, USAID remains the largest aid effort in the world. But the U.S. can do better. Despite criticism from the Government Accountability Office (GAO) and frustrated USAID workers fighting for reform, policy changes have not been made, due to vested interests in Congress. So what can we, as attentive and committed global citizens, do to help? One way could be encouraging our representatives in Congress to support reform efforts. The United Nations World Food Programme has already begun using food vouchers in place of food ration boxes in places like Jordan for the Syrian refugees there. These vouchers give the refugees the ability to choose where they shop, what they buy, and how much– restoring their sense of dignity and normalcy. If the U.S. adopted this approach to aid, the money would be going directly into the pockets of the recipients, rather than being wasted on transportation or food they don’t necessarily want. We can spur our local and state leaders to fight for this change– a change that will ensure effective aid for all of those in need.

If you would like to take action, sign the petitions at the links below, or share Josh Meyer’s piece with your friends! Advocacy and action begins with awareness.


Meyer’s Piece:

Support organizations that fight for food aid reform:

Teen Discovers Financial Literacy and Personal Philanthropy

By: Ella
Ella is a participant in Allowance for Good's Winter 2015 Emerging Leaders in Philanthropy: Explorers class.

When I signed up for the ELP Explorers class, one of the words that jumped out to me in the course description was “financial literacy”. I had heard it before: it’s a “buzzword” often used in news articles or on talk shows, but not everyone knows what it means (I didn’t). But people often claim that it is severely lacking from our education system, and that teaching it may be the secret to preventing a good amount of our financial troubles. It turns out that financial literacy can mean a myriad of different things to different people, but fundamentally, it is the ability to understand financial matters, and how money works in general. However, many people don’t possess this understanding, as a 2008 survey shows that only 34% of parents have taught their child how to balance a checkbook.

In the most recent ELP class, we began to learn financial literacy by tracking our weekly spending and comparing it to our weekly earning. Many of us were surprised, and realized how little we think about spending money as teenagers. Financial literacy ties into personal philanthropy because it teaches us how to properly allocate and transfer funds. Also, keeping in mind my own spending highlights how severe needs are in the areas where we are trying to direct our aid to, and provides a sense of urgency to our personal philanthropy. For example, I will usually spend 7 or 8 dollars on food when I go out with my friends without a second thought. However, 2.7 billion people worldwide are struggling to survive on less than $2 a day, or a fourth of that amount. We also learned about AFG’s global affiliates, many of which combat similar situations: There’s the Liger Learning Center, based in Phnom Penh, Cambodia, a progressive school that provides opportunities for bright children living in poverty. There’s the Adonai Child Development Centre in Uganda for kids living among AIDS, war, and poverty. Finally, there’s Spark Ventures, which is Chicago-based and had a representative come in and educate us about their partnerships, such as Hope Community School. This is located in Zambia and provides the impoverished children of Twapia with an education. In future ELP classes, I’d be interested to learn more about what we can do to get involved with our global affiliates and how we can fundraise for them.


Ella writes, "I am a Catalyst for Good because no matter who you are or where you come from, you can make a difference."

One Member of a Seven Person Family

By: Ryan Barrett
Ryan is co-founder of the Allowance for Good Associate Board. To learn more about Ryan, read his bio here

I was born March 10, 1988 with my two triplet sisters – Meghan and Kathleen. On March 2, 1989, our sister – Patti – was born. On March 9, 1990, our brother – T.J. – was born. In other words, I’m one of a five kids in a ridiculously compact family.

Ryan, center, with his four siblings.
My siblings and I were all very fortunate to grow up in a household that fostered each of our individual curiosities, strengths, weaknesses, passions, you name it! On any given Saturday, it wouldn’t be so out of the ordinary to be at my sister’s swimming meet in the morning, another sister’s track meet before lunch, my basketball game in the afternoon, my brother’s soccer practice after that, and my other sister’s piano recital after dinner. We did a lot, and we did a lot together. We were lucky.

Coming from a large family, I learned humility at a very early age. Regardless of what any of us had been doing or how we had been doing at it – whether good or bad – we were each just one member of a seven person family. Now, that’s not to say that victories weren’t applauded and losses weren’t consoled. It just means that my parents engrained in each of us that not one member of our family was any more (or less) important than any other member of our family. That same virtue rung true throughout all aspects of our lives – from the classroom to the locker room to the kitchen table – and with each person we interacted with.

As I grew up and began to get involved in volunteering and philanthropic activities, I developed an appreciation for how fortunate my siblings and I had been to have had the supporting environment that we grew up in and to have had garnered the experiences that ultimately led my triplet sisters and me to Northwestern University. I, again, was humbled and I wanted to give back.
Ryan on a Global Business Brigades trip, Panama.

Going into my junior year of undergrad, I came across an organization – Global Business Brigades (GBB) – that sought to ‘empower undergraduate students to develop sustainable micro enterprise in (at the time, only) Central America.’ I knew I had found my avenue to give back. Over the next two years, I co-founded a GBB chapter, recruited 30 fellow undergraduate students, and organized two trips to Puerto Lara, Panama. Over those two trips, our Northwestern team developed a sustainable eco-tourism business for the indigenous Wounaan Indians of Puerto Lara that will benefit the community for years to come.

GBB enabled me to realize the copious need in our world and the reality that I could actually do something about it. My involvement with GBB made tangible a world to me that had previously only been anecdotal. Once realizing my potential to improve those peoples’ lives less fortunate than me, I very much enjoyed acting on it. I will be acting on that creed the rest of my life.

Allowance for Good empowers youth by making them aware of the same realization I experienced my junior year in college. AfG, then, supplements that awareness by providing the framework for youth that suggests how they can go about actualizing their potential to influence such positive change. Armed with thoughtful programming and inspirational leadership, AfG will continue to educate the next generation of global citizens – providing the very roots of global awareness and philanthropy that will surely enable the future ripples that will leave our world a better place. I am excited to be a part of those ripples.