Helping others to help themselves
With a tap of their laptop computer keys, Hongkongers now regularly donate to help poor people around the world set up small businesses.
Whether it is to help a Tanzanian set up second-hand clothes stores, an Inner Mongolian couple to run fruit stands, or Sichuan villagers to raise piglets, microfinance has quickly become among the trendiest ways to make donations in a city known for its generosity.
Overseas microfinance institutions that receive most of their donations online have struck a chord in Hong Kong. 'A very typical ethos of capitalism is self-reliance,' said Ting Wai-fong, an associate professor and microfinance expert at Polytechnic University.
'People in more metropolitan and very capitalistic societies, without much religion-driven moral duty, they will probably buy this concept.'
The principle behind microfinance is that it helps people to help themselves, and that is what Ting believes is especially appealing to Hongkongers.
The concept is simple: would-be donors browse online profiles of people across the globe in need of a few hundred to a few thousand US dollars to invest in a small business.
The recipients are usually too poor to get loans, as they lack assets to use as collateral.
Prospective donors read about their families, see their photos and scrutinise what they will do with the money. Then they donate as little as US$25, receive updates on recipients' businesses and later check that their loan is repaid without interest (the interest goes towards their operating costs).
That is the model used by Kiva, an American charity organisation founded in 2005. Its Hong Kong 'lending team' - whose recipients sign up to - has raised more than US$48,000.
Wokai, a Beijing-based microfinance firm that focuses only on Chinese recipients, has received over HK$394,000 - about an eighth of its total donations - from more than a hundred Hong Kong donors since its founding three years ago.
The only difference is that the repaid loans are not returned in cash, but allow donors to choose other recipients. The fact that the money is 'recycled' upon repayment means the number of people receiving funding only increases over time.
Closer to home, the Hong Kong Mortgage Corporation has been studying a microfinance scheme for Hongkongers since March.
'Microcredit is not a charity. It's not just giving people fishes when they are hungry,' PolyU's Ting said. 'But charity is 'you give to me, I don't have to return' I lose face.'
Victoria Lau, vice-president of an investment bank in Hong Kong, who spent over HK$1,000 on donations to Wokai recently, said: 'As a banker I look at companies starting from scratch and getting listed, so I really cherish their thought processes in wanting to be an entrepreneur.'
Although microfinance has been the hottest trend in charity in recent years, the sector has not been without controversy. Nobel Peace laureate Mohammad Yunus was ousted in March from Grameen Bank, a pioneering microfinance lender he founded, by the Bangladeshi government, which allegedly saw his popularity as a political threat.
Yunus later blasted India's two largest microcredit lenders for levying high interest rates, which allegedly led to more than 30 suicides in the state of Andhra Pradesh.
