USA Today: Entrepreneurship turned eBay founder Pierre Omidyar into one of the world’s richest men. Now, he’s betting it can ease one of the world’s most daunting problems: poverty.
Omidyar, who started eBay 10 years ago, will announce Friday that he is donating $100 million for a new Tufts University program to generate millions of tiny loans, some as small as $40, to finance entrepreneurs trying to escape poverty in India, Bangladesh and other poor countries.
The gift is a big endorsement of social entrepreneurship — a field of growing interest for the new generation of technology entrepreneurs. The shift could recast traditional philanthropy dominated by non-profits such as the Ford Foundation built on Old Economy wealth.
The microfinance industry began about 30 years ago in rural Bangladesh when economics professor Muhammad Yunus launched what is now Grameen Bank. It has 3.7 million borrowers, virtually all women, relying on the bank’s nearly 1,300 branches covering 46,000 villages. Repayment rates are 95% to 98%, says Grameen Foundation USA, the bank’s U.S. affiliate.
Since Grameen’s launch, a network of other microlenders — as many as 10,000 — has sprung up worldwide, lending about $24 billion annually, says the Microcredit Summit Campaign, funded partly by Omidyar. Over the next 10 years, he expects the Omidyar-Tufts Microfinance Fund could unleash $1 billion in loans, many to women, as capital is repaid, then lent again.
Omidyar, with $10 billion, ranks No. 18 on Forbes’ list of the 400 richest Americans.