SPECIAL EDITION: CORONAVIRUS: Andrea Jung on How Microlending is Helping Women Entrepreneurs

resources and some much needed inspiration. Today I'm joined by President and CEO of gramin America, Andrea Young Andrew thanks so much for joining us. Thank you. I hope everybody is safe and staying healthy and pleasure to be here. Thank you, Andrea. Uh So. For listeners who don't know um about gromin America, uh tell us a little bit about the organization and who you serve. Sure so. Comin America is the fastest growing and largest micro finance organizations

in the United States. We give entrepreneurship loans two women and their families who are living at or under the poverty line. We serve members in twenty four locations. Uh and we are in fifteen cities. We have dispersed over one and a half billion dollars of loan capital since the organization started in two thousand eight. And what's pretty remarkable. These are nonrecourse loans and over that money has been repaid. Uh So it's been amazing. We've served over a hundred

and thirty thousands women and their families across the country. Amazing, amazing. Just for the listeners, Uh, what do you mean by non recourse? Meaning that if you or I has a loan, a traditional loan, we have to have some kind of collateral, it has to be back um, and that is not the case with Agremen loan. We obviously want to encourage behavior, encourage them to build a credit score and repay, but if they cannot repay, uh, you know, that is the

loss of the organization. Amazing. So uh so you're really addressing women entrepreneurs in sort of low income circumstances. How are they being affected right now? Well, extraordinarily hard him. I mean, if I go back before the pandemic, I just look back over the last ten years, women in general who are business owners um have an a harder time accessing capital. A one dollar at his twenty three dollars in two thousand eighteen was given to a woman entrepreneur.

And that's for her sense, and certainly at our level, if you're in a woman in poverty, a low income family, that's even tougher. So women are been disproportionately affected, um in the ability to access capital. One of the things that we've been doing, obviously since we started in o A is making sure that we level that playing field right. The pandemic and is hitting you know, all businesses. I mean, certainly the number one priority is the health and safety

of all Americans in every single city. Uh, and we we understand that. But equal to that is is as we come out of this health crisis, the economic impact, particularly to micro and small businesses is huge. Uh. The restaurant owner who you know, spent ten years building up a tiny business with two employees. It's a great little restaurant. Um, she would have been a member with me and paying us back every single week, you know, building credit, serving

more and more people in the community. She, like every other restaurant, is shut. She's not as large, she doesn't have the same kind of balance sheet. You know, she only has weeks before potentially you know, she has to shut down. So the impact on micro and small businesses

is huge all over the country. To Gramine certainly, but to to other organizations that lend two small businesses, and to the small business owner herself, uh, certainly for themselves and their families, trying to be safe uh and protect protect their loved ones, and yet worrying equally and having an extraordinary amount of anxiety about the economic impact that he's going to have and paying that next month rent.

We know that your community in particular has a lot of service businesses, right, so it seems like that would be uh, your community is disproportionately affected. Is that is that right? Well? Are half of our businesses are service businesses and half of them sell products. And certainly the service businesses are immediately hit. So if you're running a nail salon, a hair salon, if you are cleaning services,

people don't want you in their homes. If you're running a small food establishment, yes, of course, just like the big establishments in that space, but certainly the small ones they are being hit super, super hard. And the other thing that's amazing about Gramine and the model is, as you said earlier, the repayment rate being so incredibly high, and I think that's due to the unique way that you um lend money. Could you talk a little bit

about the social capital model. Yes, I mean it has been an extraordinary two weeks of a pivot and a transition because GRIM in America, like many micro finance organizations all over the world, really has been centered around social

capital and community. So equally important to the money that we land our members are the fact that we have anywhere from on a given day to thirty people at a center meeting, and we have over two thousand centers going on every week where women are coming together sharing their best practices, really forming a peer network of other women entrepreneurs. In addition to having our staff who are are financial coaches, are center managers as we call them,

uh really teach them the disciplines and financial education. So that has been the alchemy and the glue of the Grameen model for nearly twelve years here in the United States. And the first city that started social distancing and then that moved to shelter at home and you cannot go out obviously put this concept of coming together as community, which has been so critical UM at great odds with

the proper and mandages thing to do. So I'm really proud that we have conver it completely to virtual community. So if you can imagine um in terms of current members who have loans, we're talking about, you know, close to sixty thousand literally dialing into Zoom calls thirty at a time, entering their past codes and continuing their community

but over zoom type technology, not in person. That has now been converted in every single city across the country, So we have tens of thousands of women now participating in their GAMIN America Center meetings virtually we have technology that can enable the process. So every single GAMIN American member has a card. It's a card, a disbursement card that we can load their loan onto and it comes

directly technology wise from our central bank. So therefore they don't have to come to us and get a check for a loan. They can just have it loaded and and sit on their couch at home, not leave their home, and get their loan loaded onto it. They can repay us with virtual and remote repayments capabilities, and all of this wouldn't have been possible several years ago, but we are ahead of many microfinance institutions in terms of adopting

this technology as tools for these women. We've been working on it over the last few years. We never dreamed that this crisis would be the time that conversion and adoption of this would have been a necessity, not just an enhancement. But thank goodness because we now have these tens of thousands of women who can participate in the loan program, who can continue to come together as community and support each other in a very very fearful time.

And that infrastructure is in place and rolling right now. You know, obviously we have centers that are spending in the middle of Queens um just you know, blocks from Elmhorst Hospital. That's the hardest hit obviously at the center, and an extraordinary difficult time for our members in New York, but every city. But I actually had a call from my branch manager in Austin yesterday and said to me, basically had a hundred percent attendant online attending virtual meetings

and that list. I was just so proud, so proud. Well, I mean, obviously the bond and the social capital bond translates into everything positive that Grimin does, including those incredibly higher payment rates um and and the building of credit for those women, and it comes from trust. I mean, and when people ask me all the time, I mean, how do you have an over payment right when there is no collateral or recourse on the loans And the answer is trust, gratitude. These women aren't able to get

loans from the formal capital market. You know, credit is a basic human rights. Access to capital is a basic human rights for women as well as men. And because we deploy it so quickly and because we believe in giving them that capital, they're so grateful. And in this time we're trust on everything is still critical. The ability

to share their concerns, help each other. It's more important than ever all of us who are in social isolation right now now that it is may not be in person, but the people that we're talking to loved ones for peers help and that's what they have with this our true meeting. So uh, they get their loans loaded through their cards. And obviously, um, this is a very hard time, as we said, to be a small business and many of these um, many of these womo either won't be

able to pay or will need certainly significant support. What are you doing right now to address the loan portfolio that you have. We took some very fast actions, difficult but important for our members. So as of tomorrow, I will first all the way through the end of June, our members will pay zero interest. We will waive all

interest fees on those loans um. Secondly, UH, they have to repay us by these remote digital methods, whether it's a direct repayments from their bank and a h transactions, whether it's going into a convenience store or pharmacy where we have a payment opportunity that goes directly back to us, or a debit card repayment. All of those transactions have a cost to range from eighty cents to a dollar

ninety nine transaction. But that's a lot of money to remember, So during this period, we are covering all those costs UM. And the third thing we're doing is, you know, allowing them to restructure their loans UM. If you know, andreas in weekly installment with three dollars and I had twelve more weeks to pay my loan, and we're doubling that and allowing to pay back in twenty four weeks and

only pay half of the amount. UH. And then for those who you know are really struggling with certain businesses were certain looking for supporters and partners to help us with you know, bridge loans and back stops to help some of our members in this time or just struggling

no fault of their own. I have had um, extraordinary business owners who were perfect payments track records, UM, great, great business records, want to keep their employees on staff, and then because of circumstances out of their control, I don't have any customers in this moment. So are our goal and our commitment is just trying, you know, tied them through this difficult period. And then unlike other organizations, I mean, they're not being laid off. You know, they

own that food card, they have that flower shop. UM. Hopefully as soon as things do open up in the right time, not too soon, but when the health crisis allows, the bounce back will be fast. Um. And our our job is to make sure we can bridge them through this difficult time and can the stimulus package help. It may be able to help some of them, um, but the time the administration in terms of how to get it.

I mean one of the things that Gremine America does is tomorrow, uh, you know, in twenty four hours, we can deploy capital immediately, no pay for work um, no cumbersome confusion. They know the process and that's why you know when when they needed the most, because they can't wait a week, right, some of some of these applications you know, are due by June thirty. If they can't wait until June thirty. Yeah, amazing to have to be part of this community right now there. I'm sure they're

very grateful to be part of the Green family. They are very nervous in that grade and mostly grateful to have our commitment even in these hard times. We'll be back after this break. I mean, you've worked with women for so many years. I mean obviously first said Avon, for many many years leading Avon, and now with Gremin. I mean, what have you seen in terms of the resiliency?

You know, I could get on a soapbox for a long time about this because I've had the first hand experience over several decades of seeing um, the innovations and the resilience of women entrepreneurs. I think it's been well known and well documented that when a woman earns a dollar, that dollars has a greater impact and she will put more of that back to community, to her children, to education, to health, um. And I think we're going to see

that more than ever now. Uh We While on one hand, women are disproportionately negatively affected in terms of their ability to access capital, when a woman entrepreneur is able to run her own business, we see that the growth of that business is fact. She pays equally, she takes care of her employees, and you know, I think it goes

without saying. I mean, I think that there's so much data again before COVID nineteen that says if we just had equal access to capital, equal pay, equal participation of women in the economy, it is trillions of dollars of economic growth. So just substituted post COVID and say the recovery will be disproportionately as far as I'm concerned, driven by making sure women start participate and part taking that recovery. Women are resilient, they are innovative. Um, that we'll play

itself out. And I mean that's what we're all crossing our fingers for and that's why we have to continue to support them to this time. Well, my last question was gonna be what makes you optimistic in this moment um? But I feel like you've just answered it. It It seems

like the resilience of women. I mean, it's hard. It's such a dark moment, you know, it's it's such a difficult time and understandably, so what what has to keep us all optimistic and hopeful is the community that we are seeing at every level I get to see it. You know, it's a two thousand strong right now with every green center that is being done in a very different way, but it's still community. And you know, while they have huge anxiety and fear um, they have to

be hopeful. They are by humans and women are by definition are optimistic, and we will prevail if we do all the right things critical to count on them to be the moral and financial support of the community. And I am optimistic about that. I am optimistic with that that will serve us well through this crisis and then into what is obviously a critically important recovery period for every economy around the world and certainly for this one right here in the United States. Well, we're grateful that

you're leading for me in right now. We could not be in better hands. So we appreciate everything you do. Andrea um It's listeners want to support or mean what can they do in America dot org donate now. Well, thank you so much for being on the show. I'd love to bring you back if if you can do it in the next few weeks and see if you can give us an update on what's going on for

for women around the country. Thank you, said everyone. You're listening to Seneca Women Conversations on Power and Purpose, brought to you by the Seneca Women podcast Network and I Heart Radio with support from founding partner p And Listen to Seneca Women Conversations on Power and Purpose on the I Heart Radio app, Apple Podcasts, or wherever you get your podcasts, and please support this podcast by telling your friends, subscribing,

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