The Real Impact of Microfinance in the U.S

Microfinance commenced in the United States after the realization that microlending programs were working abroad, and something similar could be implemented in the country by modifying our epistemological perspective on the subject. The U.S is a formal economy that has different issues from less developed countries. The aim is more than subsistence. The aim is to increase the quality of life of the borrower and her/his family to create prosperous communities.

While microloans for equipment purchase, working capital, marketing, and start-up capital are common reasons for the purpose of the funds. Microfinance is larger than these immediate solutions. For instance, Accion East aims at building a financially inclusive world with access to economic opportunity for all, by giving people the tools they need to improve their lives. These tools can involve financial guidance, business consulting, and more.

These loans and tools are offered in the hopes of a success story like Uvalda– Accion’s very first client in 1991. Uvalda, a recent immigrant at the time, requested a $500 loan to purchase a truck to sell Mexican food to factory workers. It went well, and subsequently received larger loans from the micro-finance institution. She later opened additional locations, and was able to put her kids through college. Her kids benefited, and are more than likely better positioned to navigate their course of life compared to when her mother started her trajectory.

Microfinance in the U.S expects a real impact in the long-term lives of their borrowers, family members, and communities. In the end, it strives to increase the social and economic development of the society at large.