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About the Program

St. John’s The Peter J. Tobin College of Business recently introduced a novel, student-run Global Microloan Program that actively engages students in international finance while fulfilling St. John’s Catholic and Vincentian mission of helping the poor and the marginalized.  In the Vincentian tradition, the program, named GLOBE (Global Loan Opportunities for Budding Entrepreneurs) aims to help the poor help themselves by boosting the earning capacity of local entrepreneurs while also serving the needs of their local communities.  It reflects the University’s long-standing commitment to globalization and student engagement.

Lending small amounts of money to entrepreneurs who do not have the necessary collateral required by traditional financial institutions to qualify for a loan has been increasingly embraced by the microfinance industry.  Borrowers in the most under-resourced regions of the globe, most of whom are women, are carefully vetted and repayment terms typically vary from nine months to two years.  Default rates on these loans tend to be low, averaging approximately three to four percent and a recent focus on measuring outcomes suggests that communities receiving microloans enjoy lower rates of extreme poverty and higher levels of education for the borrowers’ children.  

The organization of GLOBE begins with a class of selected students who demonstrate a strong record of academic achievement, an understanding of the global business environment and an expressed interest in microfinance and social entrepreneurship.  Relying heavily on the Web to source donations, the program combines St. John’s award-winning Information Technology capabilities with student talents in marketing, management and financial assessment. The Daughters of Charity serve as program field partners, coordinating the necessary distribution and collection of funds worldwide.

The program is based upon a division of labor between participating students and the Daughters of Charity and is designed to achieve effectiveness and minimize administrative and start-up fees.

With an established presence in 72 developing countries and familiarity with their local communities, the Daughters of Charity receive initial applications.  They then communicate with and distribute funds to approved candidates and subsequently collect loan repayments. They monitor loan repayment and fees, and assist in assessing lending risk and evaluating business plans. 

Students in the class, which runs every semester, work in task teams to manage the microloan fund, vet loan applications, maintain the website, market the program, communicate with stakeholders, and raise funds.  Every loan presents a new learning opportunity for students about the microfinance industry and social entrepreneurship, the issues of poverty and social justice in the developing world, cultural differences that impact the way in which business operates globally, and the power that each individual has to make transformational changes in the world.

At least 95 cents of every donated dollar goes directly to our borrowers and related student fieldwork.