“When we want to help the poor, we usually offer them charity…..Charity becomes a way to shrug off our responsibility. But charity is no solution to poverty. Charity only perpetuates poverty by taking the initiative away from the poor…Charity appeases our consciences.” -Professor Mohammad Yunus
Who Are We Helping?
Almost every time I’m driving around Lahore, I have one very consistent experience. At some signal, while I wait for the lights to turn green, caught up in my own internal plethora of irrelevant thoughts, I suddenly begin to observe the mundane scenario at the signal. A homeless man with torn clothes. A woman carrying a malnourished toddler in her scrawny arms. These are the usual suspects.
In these few seconds, many thoughts cross my mind;
Shouldn’t this child be in school?
Is this the same man I saw at another signal?
Are they actors?’
And, as the light turns yellow, I reach for my purse frantically and do what I’m programmed to do. I appease my conscience in the short run so I can enjoy my day without guilt. I drive away feeling relieved, saddened, guilty, and so many other things.
A Growing Movement
Over the last few decades, a growing international movement has been questioning the efficacy of traditional philanthropy. Philanthropy, which is most often characterized by short-term monetary donations for various social interventions. The objections have several angles. Some question the longevity of such efforts, and others question impact. The solution that many, including Nobel Laureate Mohammad Yunus, envisioned, was to replace charity with more economically sustainable alternatives, which have an underlying focus on empowerment, investment, and support.
A New Narrative
This enables us to shift the narrative. From one where the privileged temporarily empathize with the poor but continue to view them as unproductive, to one where they are able to witness extraordinary stories of survival, success, and transformation.
Within this movement, fostering entrepreneurship among poor communities through financial inclusion has taken the lead. It all started out with a real-life economics experiment by a Bangladeshi Professor. However, it soon shifted the very foundations of how the world tackled poverty. In 2017, globally, over 100 million people from low-income backgrounds are served by financial institutions. These provide microloans targeted to the poor with almost no collateral at all. There is also a growing realization that microfinance and financial inclusion may be one of the most formidable means of achieving the Sustainable Development Goals set up by United Nations.
The Story of Ruth
A few years ago, Ruth, a resident of Yuhanabad in Lahore, approached the microfinancing institution I manage, for a business loan. Just like thousands of women in Pakistan, she had learned cooking from her own mother. She had been preparing food for her family as part of her everyday routine. Unable to make ends meet, Ruth decided to turn her culinary skills into an enterprise. However, there was one significant hurdle in her way. There is a systemic bias against Christians, which perpetuates the perception that they are not ‘hygienic’ enough to be engaged in a culinary activity.
Unfazed by this obstacle, Ruth persisted on. What is surprising about her story is that through her skill and business acumen, she was able to override stringent religious boundaries. Something which many of us have been unable to achieve. She began reaching out to customers personally in the hopes of expanding her network. And, was able to persuade many potential customers through her amicable demeanor.
She initially took a small loan of Rs.30, 000. Now, she is turning monthly profits of around Rs. 40,000.
Through her profits, she has invested in her children’s education, as well as expanded her network. Now, her eldest son assists her with escalating the business through mobile phone usage and social media marketing. Despite being from a working-class background, carrying no formal business or marketing training, she is not giving up and the business is booming!
A Complex Situation
Ruth’s story gives us an insight into the actual entrepreneurial world of the poor and is significant for various reasons. Contrary to popular opinion, once in the field, those of us who work closely with the poor realize that there is, in fact, a complex mechanism of survival and growth that the poor have adopted. Moreover, many of their business choices are a result of carefully crafted strategies, which may outperform textbook case studies of business tactics.
Romanticizing The Poor
Through this account, I also do not mean to fall into the trap of overly romanticizing the poor. There is, of course, an internal diversity within these communities. There are a lot who’ll be difficult than others, and many experiments will fail as well. Some, like Ruth, will stand out and become community leaders. While others will have a less exciting trajectory. However, during the journey, we realize how little we know and how fallible many of our abstract and intangible ideas are. Perhaps the biggest indicator of success is when those we saw as helpless, illiterate, and dependent on our support reach a position where they are able to reject our ideas, correct our mistakes, and suggest an alternative path to proceed. It is certainly an experience that gives me hope and puts a smile on my face.