The micro-lending revolution made it possible for community-based lending institutions to provide $25 loans for entrepreneurs in emerging markets — and is now making its way to your local Starbucks. Starting November 1, if your friends can’t spot you $25, you might be able to get financing from hundreds of thousands of coffee-drinkers. At over 7,000 Starbucks coffee shops around the nation, patrons will be able to give micro-donations as small as $5, which will then be re-packaged into larger loans for worthy local businesses.
The Create Jobs for USA micro-lending plan, made possible through the vision of Starbucks Chairman Howard Schultz and the Opportunity Finance Network, is elegant in its simplicity: groups of individuals, by pooling their limited financial resources, can effect change on a scale that large financial institutions cannot. The national reach of Starbucks, with the generosity of coffee drinkers willing to donate $5 or more, almost guarantees that this new micro-lending initiative will have a meaningful impact. According to Starbucks, every $3,000 raised will create one new job in America. Every $5 donation makes it possible for businesses to raise $35 in financing. That may not sound like much, but at a time when small businesses create 50% of all new jobs in America, this means that every $5 donation can lead to job creation and community revitalization.