History and Mission

The Microcredit Clearinghouse brings the best microcredit projects in the world to the attention of charitable foundations and high net worth individuals. It was created to fulfill the potential of a unique opportunity.

Phil Smith is a long-time donor to microcredit projects, co-author of A Billion Bootstraps, and advocate of microcredit and giving with an investor\'s mindset. He often acts as an informal advisor and information source for large charitable foundations and high net worth individuals. This unique combination of attributes allows him the opportunity to work with multiple microcredit organizations to help them describe, evaluate, and design projects which should be of interest to potential funding providers.

The goal of the Microcredit Clearinghouse is to help donors and nonprofit organizations team together to "create the most good for the least cost." To accomplish this goal, it seeks to change the dynamic between microcredit organizations and potential donors or lenders.

Historically the relationship dynamic was led by a nonprofit organization reaching out to a donor saying, "We need money, please give it to us, we\'ll use it the best we can, thank you and please you give us more." Instead, the dynamic might better start by the nonprofit approaching potential with, "Together we can change lives for $x per person, so how many lives would you like to change? Thank you, we will keep you apprised of the results so you will want to change even more lives."

By accessing the Microcredit Clearinghouse a potential donor takes some important steps in giving with an investor mindset by:

• being proactive in finding projects rather than evaluating only those projects which are being offered,
• seeing projects from around the world, rather than only those in a single community,
• being concerned about changing lives on a permanent basis,
• comparing projects from different sources,
• comparing the financial effectiveness of different projects,
• taking advantage financial leverage, and
• working together with the microcredit organizations to improve the style and terms of the projects being offered.

Of the more than 3,000 existing microcredit organizations, the ones featured on this website together represent a wide cross-section of size, scope, and geographical diversity. Each of them has an excellent record and reputation. So, the projects featured on the website represent the best large-scale microcredit projects available to donors. As one project receives funding, it is replaced by another.

These projects have been chosen by the microcredit organizations for two reasons. First, they represent the wide variety of microcredit opportunities which exist or can be created. Second, they represent projects which have excellent financial efficiency in terms of "cost per life changed" or "CPL."

The Microcredit Clearinghouse deals only with projects which cause enough change in people\'s lives for them to actually experience long-term improvement. This improvement may occur in the form of permanent poverty reduction, improvement in health, job training, and a myriad of other ways. In an effort to compare the costs of different programs, the Clearinghouse uses a method it calls Cost per Life or "CPL". This is the cost to cause one person to experience long.term improvement in their life. Since a main benefit of microcredit is the re-loaning of money, the calculation of CPL is done over both one-year and ten-year time frames.

CPL is not an exact calculation, but it is very useful to help rank and compare projects. However, even if CPL were a perfect measurement, it still should be only one of many factors used when choosing a project. Above all, donors have preferences important to consider in order for them to obtain satisfaction. Some people want to support projects in Haiti, others in China; some want to support women, some want to help orphans, some want to help prevent disease. When choosing among excellent projects we should remember the saying: "In matters of taste there is no right or wrong."

Please keep in mind all descriptions and evaluations of both the projects and the organizations have been provided by the microcredit organizations. If you have interest in funding any of these projects, please contact the designated representative of that organization to get more information. We highly recommend that you do the same level of due diligence performed by any good investor.

In addition to maintaining this site, Microcredit Clearinghouse has small gatherings of donors where these organizations are afforded the opportunity to make presentations. Participants in these meetings have the opportunity to meet representatives from selected microcredit organizations and to see presentations on chosen projects. If you desire to have more information, please email Mariann at microcredit@sbcglobal.net.

All of the descriptions and evaluations have been provided by the microcredit organizations. MICROCREDIT CLEARINGHOUSE DOES NOT DO DUE DILIGENCE ON THESE PROJECTS OR VOUCH FOR THEIR VALIDITY. Therefore, please do your own due diligence on any project.

Disclaimer: The content presented herein is presented as general information and is not intended to be a comprehensive overview of all microcredit options. Nor is it meant to imply any endorsement of any project or microcredit organization. Microfinance is a complicated and serious process being constantly affected by conditions in the marketplace and changes in law and governmental policies. There is no guarantee that each project will perform as stated. You should research your choices as thoroughly as possible, especially any potential tax consequences.