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Microfinance: A Ladder Out of Poverty

Juan Gonzalez (C鈥15), second from right, worked at the microfinance company Parvati Swayamrojgar, while studying abroad in Pune, India. Photo courtesy of Juan Gonzalez.

July 28, 2014鈥擥rowing up in the small Oregon town of Cornelius wasn鈥檛 easy for Juan Gonzalez (C鈥15). His mother was often unemployed. His father worked as a landscaper and barely made ends meet.

鈥淢uch of my childhood was spent helping my father and watching him struggle with his small business,鈥 Gonzalez said.

So when it came time to pick a college, Gonzalez wanted to get as far away from Cornelius as possible. Washington, DC, seemed distant enough. But going far away ultimately brought Gonzalez back to the issues he struggled with as a child.

鈥淎t Georgetown, I realized I was passionate about poverty and wage issues because of the experiences I had growing up,鈥 he said.

During his time at Georgetown, the  and  double major felt inspired to tackle these big problems. That鈥檚 how in the spring semester of 2014 he ended up in Pune, India鈥7,000 miles from his Oregon home.

鈥淚 wanted to experience something completely different, and India was definitely different,鈥 Gonzalez said.

At a population of just over eight million, Pune, in the Maharashtra state, is the seventh largest city in India. It鈥檚 known as an educational hub and as such attracts students from all over the world.

While studying abroad, Gonzalez got to roll up his sleeves and work at an internship at the microfinance company Parvati Swayamrojgar (PSW). The company provides people in urban slums access to credit to pursue small business opportunities.

One common start-up, Gonzalez explained, was a food stand for which people needed capital to buy things like pots and pans and raw ingredients. They could also access credit for things like home renovation and education.

Through his internship, Gonzalez got a window into the lives of the most needy in Pune. Part of his job was to visit the slums and talk with people about what kind of capital they needed. He said the experience was life changing.

He interviewed 25 people about their lives and found that despite their crushing poverty, their generosity was often overwhelming. Inevitably in every home he went into Gonzalez was offered food, water, and sweets.

鈥淰isiting these people鈥檚 homes was a humbling experience. You saw that for them, life wasn鈥檛 all about iPhone 5s and the latest technology,鈥 he said. 鈥淚 thought I grew up in poverty, but I saw real poverty there and it inspired me to do something about it.鈥

Not only did Gonzalez see real poverty in these slums, but he also saw what could happen when people are given an opportunity to succeed. Most of the people he worked through PSW had perfect credit scores. And accessing credit was the first rung on the ladder out of poverty.

鈥淚 was always amazed to see that people in extreme poverty will work extremely hard for opportunities,鈥 he said. 鈥淭he money that came from microfinancing wasn鈥檛 a handout, which is why it鈥檚 so great.鈥

Interning in India and seeing the issues people face from the ground level inspired Gonzalez to stay on the path of economic justice. When he returned from India, he began an internship with , an international development organization based in Washington.

As an intern with their policy and advocacy team, Gonzalez is grateful for the grassroots work he did in Pune.

鈥淲orking in the field has made this a whole lot more fruitful,鈥 he said.